Exam 9: Aggregate Demand

In the income-expenditure framework,if planned aggregate expenditures are less than real gross domestic product (GDP),_____.​

The smaller the marginal propensity to save,other things constant,_____.​

If the marginal propensity to consume (MPC)equals 0.9,the multiplier is _____.​

An increase in the price level will:​

An increase in planned investment will shift the _____.​

If investment increases by $100 and,as a result,gross domestic product (GDP)ultimately increases by $200,the multiplier equals _____.​

Which of the following is not true about a change in the price level?​

Which of the following will shift the consumption function upward?​

Historically,consumption spending in the United States has _____.​

The market interest rate is important to the investment decision of firms:​

The consumption function assumes that:​

If a household's income rises from $46,000 to $46,700 and its consumption spending rises from $35,800 to $36,400,then its:​

The fraction of a change in disposable income that is consumed is called _____.​

The sum of the marginal propensity to consume (MPC)and the marginal propensity to save (MPS)equals:​

In the income-expenditure model,if autonomous saving increases by $15 billion,_____.​

Government outlays equal:​

An increase in the interest rate,other things constant,decreases the amount of investment spending.​

The aggregate expenditure line shows total planned spending at each _____.​

An increase in the marginal propensity to consume (MPC)will cause the consumption function to become steeper.​

An increase in the price level in an economy will _____.​