Exam 11: Classical and Keynesian Macro Analyses

In the classical model, aggregate demand and aggregate supply will

The exchange rate last month was $1= 1 Swiss francs. This month it is $1 = 0.95 Swiss francs. We can say that the value of the dollar

If the full-employment level of real GDP is greater than the equilibrium level of real GDP, the nation would be experiencing a(n)

If the economy is operating at a point at which short-run aggregate supply is horizontal, then

Say's law states that

Regarding unemployment, the classical model implies that

Classical economists wrote from the 1770s to the ________.

According to classical economists, a decrease in the rate of interest will

Holding the level of prices fixed implies that a given decrease in aggregate demand

Which of the following statements is NOT true about Say's law?

An assumption of the classical model is that

-The reason that it is possible for the economy in the above figure to be at E2 rather than at E1 is that

The Keynesian short-run aggregate supply curve in the simplified Keynesian model is unrealistic because

According to classical theory, a shift in aggregate demand will affect

Suppose Moni thinks a 100 percent increase in her hourly wage as an incentive to work more hours while the price level also increases by 100 percent. Moni is said to be suffering from

In the classical model, the aggregate supply curve is

An individual who suffers from money illusion will

In the classical model, how do shifts in aggregate demand affect real GDP?

Keynesian economics predicts that if government policy makers deem current equilibrium real Gross Domestic Product (GDP) to be "too low," then an appropriate policy action would be to

According to classical theory, total employment and real Gross Domestic Product (GDP) are