Exam 12: Aggregate Expenditure and Output in the Short Run

Inventories refer to

During a(n)________ many firms experience reduced profits,which reduces ________ and investment spending.

Firms in a small economy planned that inventories would grow over the past year by $300,000.Over that year,inventories actually grew by $400,000.This implies that

Ceteris paribus,how does a recession in the United States affect U.S.net exports?

All of the following are components of aggregate expenditure except

Consumption spending will ________ when disposable income ________.

If the marginal propensity to save is 0.25,then a $10,000 decrease in disposable income will

Why do economists care about aggregate expenditures?

U.S.net export spending falls when

How does an increase in government spending affect the aggregate expenditure line?

Which of the following correctly describes how an increase in the price level affects consumption spending?

The key idea of the aggregate expenditure model is that in any particular year,the level of ________ is determined mainly by the level of aggregate expenditure.

The formula for aggregate expenditure is

Which of the following will reduce consumer expenditures?

The aggregate expenditure model focuses on the relationship between ________ and ________ in the short run,assuming ________ is constant.

A general formula for the multiplier is

Autonomous expenditure is a type of expenditure that does not depend on

If planned aggregate expenditure is less than total production

________ is equal to consumption spending plus planned investment spending plus government purchases plus net exports.

Equations for C,I,G,and NX are given below.If the equilibrium level of GDP is $32,000,what will the new equilibrium level of GDP be if government spending increases to 2,500? C = 5,000 + (MPC)Y I = 1,500 G = 2,000 NX = -500