Exam 9: The Aggregate Expenditures Model
Exam 1: Limits, Alternatives, and Choices261 Questions
Exam 2: The Market System and the Circular Flow112 Questions
Exam 4: Introduction to Macroeconomics58 Questions
Exam 5: Measuring the Economys Output183 Questions
Exam 6: Economic Growth113 Questions
Exam 7: Business Cycles, Unemployment, and Inflation184 Questions
Exam 8: Basic Macroeconomic Relationships188 Questions
Exam 9: The Aggregate Expenditures Model235 Questions
Exam 10: Aggregate Demand and Aggregate Supply195 Questions
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The following information is consumption and investment data for a private closed economy. Figures are in billions of dollars.
C = 60 + .6Y
I = I0 = 30
-Refer to the above data. In equilibrium, the level of saving will be:
(Multiple Choice)
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The following information is consumption and investment data for a private closed economy. Figures are in billions of dollars.
C = 60 + .6Y
I = I0 = 30
-Refer to the above data. In equilibrium, the level of consumption spending will be:
(Multiple Choice)
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Cyclical unemployment in Canada is essentially the consequence of:
(Multiple Choice)
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C = 40 + .8Y
_
Ig = Ig = 40
_
X = X = 20
_
M = M = 30
-The equilibrium level of GDP = (Y) in the above economy is:
(Multiple Choice)
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Actual investment is $62 billion at an equilibrium output level of $620 billion in a private closed economy. The average propensity to save at this level of output:
(Multiple Choice)
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Suppose the multiplier is 4 and lump-sum taxes are increased by $16 in a closed economy. We can predict that:
(Multiple Choice)
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Other things equal, if $100 billion of government purchases (G) is added to private spending (C + Ig + Xn), GDP will:
(Multiple Choice)
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In the aggregate expenditures model, equilibrium GDP in a private closed economy is indicated by:
(Multiple Choice)
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Exports are added to, and imports are subtracted from, aggregate expenditures in moving from a closed to an open economy.
(True/False)
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In a mixed open economy the equilibrium level of GDP is determined at that point where:
(Multiple Choice)
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-Refer to the above table. If an additional lump-sum tax of $20 were imposed, we would expect:

(Multiple Choice)
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What will be the effect of an excess of planned investment over saving in a private closed economy with unemployed resources?
(Multiple Choice)
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-Refer to the above diagram. International trade has an expansionary effect on this economy.

(True/False)
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-Refer to the above diagram for a private closed economy. The equilibrium level of GDP is:

(Multiple Choice)
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If a nation imposes tariffs and quotas on foreign products, the immediate effect, if no retaliation is immediately imposed by other countries will be to:
(Multiple Choice)
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At the $180 billion equilibrium level of income, saving is $38 billion in a private closed economy. Planned investment must be:
(Multiple Choice)
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