Question 1

-The table above gives data for the nation of Pearl,a small island in the South Pacific.When the economy is at full employment the price level is

Accepted Answer

A) 130. 
B) 120. 
C) 110. 
D) 140. 
E) 150. 
A) 130. 
B) 120. 
C) 110. 
D) 140. 
E) 150.

Question 2

If the economy is above full employment,there is ________ gap,and as the economy adjusts toward full employment,the price level ________.

Accepted Answer

A) an inflationary;rises 
B) an inflationary;falls 
C) a recessionary;rises 
D) a recessionary;falls 
E) an inflationary;does not change 
A) an inflationary;rises 
B) an inflationary;falls 
C) a recessionary;rises 
D) a recessionary;falls 
E) an inflationary;does not change

Question 3

A recession in the rest of the world means U.S.

Accepted Answer

A) aggregate supply decreases. 
B) aggregate demand decreases. 
C) potential GDP decreases. 
D) exports increase. 
E) potential GDP increases. 
A) aggregate supply decreases. 
B) aggregate demand decreases. 
C) potential GDP decreases. 
D) exports increase. 
E) potential GDP increases.

Question 4

If there is a rise in the price level,there is a(n)________ movement along the AS curve because there is ________ in the quantity of real GDP supplied.

Accepted Answer

A) downward;a decrease 
B) upward;an increase 
C) downward;an increase 
D) upward;a decrease 
E) upward;no change 
A) downward;a decrease 
B) upward;an increase 
C) downward;an increase 
D) upward;a decrease 
E) upward;no change

Question 5

The slope of the aggregate supply curve shows that,all else the same,the

Accepted Answer

A) quantity of real GDP supplied increases as the price level increases. 
B) quantity of real GDP supplied decreases as the price level increases. 
C) quantity of real GDP supplied remains constant as the price level increases. 
D) price level remains constant as real GDP increases. 
E) price level remains constant as potential GDP increases. 
A) quantity of real GDP supplied increases as the price level increases. 
B) quantity of real GDP supplied decreases as the price level increases. 
C) quantity of real GDP supplied remains constant as the price level increases. 
D) price level remains constant as real GDP increases. 
E) price level remains constant as potential GDP increases.

Question 6

Demand pull inflation can be started by

Accepted Answer

A) a decrease in the quantity of money. 
B) an increase in government expenditure. 
C) a decrease in net exports. 
D) an increase in the price of oil. 
E) a decrease in the money price of resources. 
A) a decrease in the quantity of money. 
B) an increase in government expenditure. 
C) a decrease in net exports. 
D) an increase in the price of oil. 
E) a decrease in the money price of resources.

Question 7

At the beginning of 2015,a country is at full-employment.During 2015,oil-producing countries decrease oil production leading to much higher oil prices.The higher oil prices can

Accepted Answer

A) increase aggregate demand and lead to an expansion. 
B) increase aggregate supply and lead to an expansion. 
C) decrease aggregate demand and lead to a stagflation. 
D) decrease aggregate supply and lead to a stagflation. 
E) decrease aggregate demand and lead to a higher price level. 
A) increase aggregate demand and lead to an expansion. 
B) increase aggregate supply and lead to an expansion. 
C) decrease aggregate demand and lead to a stagflation. 
D) decrease aggregate supply and lead to a stagflation. 
E) decrease aggregate demand and lead to a higher price level.

Question 8

If the costs of production increase,there is

Accepted Answer

A) an increase in aggregate supply and the AS curve shifts rightward. 
B) a decrease in aggregate supply and the AS curve shifts leftward. 
C) an increase in the quantity of real GDP supplied and a movement up along the AS curve. 
D) a decrease in the quantity of real GDP supplied and a movement down along the AS curve. 
E) a decrease in aggregate supply and the AS curve shifts rightward. 
A) an increase in aggregate supply and the AS curve shifts rightward. 
B) a decrease in aggregate supply and the AS curve shifts leftward. 
C) an increase in the quantity of real GDP supplied and a movement up along the AS curve. 
D) a decrease in the quantity of real GDP supplied and a movement down along the AS curve. 
E) a decrease in aggregate supply and the AS curve shifts rightward.

Question 9

What two variables are determined in an aggregate supply-aggregate demand figure? Is the slope of the aggregate supply curve positive or negative? Is the slope of the aggregate demand curve positive or negative?

Accepted Answer

The aggregate supply-aggregate demand fr

Question 10

Demand-pull inflation starts with a shift of the

Accepted Answer

A) AS curve rightward. 
B) AD curve rightward. 
C) AS curve leftward. 
D) AD curve leftward. 
E) potential GDP line leftward. 
A) AS curve rightward. 
B) AD curve rightward. 
C) AS curve leftward. 
D) AD curve leftward. 
E) potential GDP line leftward.

Question 11

In its macroeconomic equilibrium,the economy can be producing at
I.below full employment.
Ii.full employment.
Iii.above full employment.

Accepted Answer

A) i only 
B) ii only 
C) iii only 
D) i or ii 
E) i,ii,or iii 
A) i only 
B) ii only 
C) iii only 
D) i or ii 
E) i,ii,or iii

Question 12

The figure above shows aggregate demand curves.
-Based on the figure above,the aggregate demand curve will shift from AD0 to AD1 when

Accepted Answer

A) potential GDP increases. 
B) the price level falls. 
C) the price level rises. 
D) government expenditure decreases. 
E) the Federal Reserve lowers the interest rate. 
A) potential GDP increases. 
B) the price level falls. 
C) the price level rises. 
D) government expenditure decreases. 
E) the Federal Reserve lowers the interest rate.

Question 13

If the price level increases from 110.0 to 115.0,the quantity of

Accepted Answer

A) real GDP supplied will increase. 
B) real GDP supplied will decrease. 
C) potential GDP will decrease. 
D) real GDP demanded will increase. 
E) potential GDP will increase. 
A) real GDP supplied will increase. 
B) real GDP supplied will decrease. 
C) potential GDP will decrease. 
D) real GDP demanded will increase. 
E) potential GDP will increase.

Question 14

A combination of declining real GDP and rising price level is referred to as

Accepted Answer

A) an expansion. 
B) a trough. 
C) stagflation. 
D) deflation. 
E) a depression. 
A) an expansion. 
B) a trough. 
C) stagflation. 
D) deflation. 
E) a depression.

Question 15

When potential GDP increases,

Accepted Answer

A) the AS curve shifts rightward. 
B) there is a movement up along the AS curve. 
C) the AS curve shifts leftward. 
D) there is a movement down along the AS curve. 
E) there is neither a movement along nor a shift in the AS curve. 
A) the AS curve shifts rightward. 
B) there is a movement up along the AS curve. 
C) the AS curve shifts leftward. 
D) there is a movement down along the AS curve. 
E) there is neither a movement along nor a shift in the AS curve.

Question 16

-What can lead to the shift illustrated in the figure above?

Accepted Answer

A decrease in the money wage r

Question 17

During 2010,a country reports that its price level fell and the money wage rate did not change.These changes led to

Accepted Answer

A) a higher real wage rate,lower profits,and a decrease in the quantity of real GDP supplied. 
B) a higher real wage rate,higher profits,and an increase in the quantity of real GDP supplied. 
C) a lower real wage rate,lower profits,and a decrease in the quantity of real GDP supplied. 
D) a lower real wage rate,higher profits,and an increase in the quantity of real GDP supplied. 
E) no change in the real wage rate and an increase in aggregate demand. 
A) a higher real wage rate,lower profits,and a decrease in the quantity of real GDP supplied. 
B) a higher real wage rate,higher profits,and an increase in the quantity of real GDP supplied. 
C) a lower real wage rate,lower profits,and a decrease in the quantity of real GDP supplied. 
D) a lower real wage rate,higher profits,and an increase in the quantity of real GDP supplied. 
E) no change in the real wage rate and an increase in aggregate demand.

Question 18

For a demand-pull inflation to persist requires persistent increases in

Accepted Answer

A) tax rates. 
B) the real wage rate. 
C) real GDP. 
D) the quantity of money. 
E) government expenditures. 
A) tax rates. 
B) the real wage rate. 
C) real GDP. 
D) the quantity of money. 
E) government expenditures.

Question 19

A recessionary gap occurs when ________ so that real GDP is ________ potential GDP.

Accepted Answer

A) aggregate supply increases;less than 
B) aggregate supply decreases;less than 
C) aggregate demand increases;greater than 
D) aggregate demand decreases;less than 
E) potential GDP decreases;greater than 
A) aggregate supply increases;less than 
B) aggregate supply decreases;less than 
C) aggregate demand increases;greater than 
D) aggregate demand decreases;less than 
E) potential GDP decreases;greater than

Question 20

If the money wage rate does not change,a decrease in the price level will ________ the real wage rate and ________ firms' profit.

Accepted Answer

A) raise;decrease 
B) raise;increase 
C) lower;decrease 
D) lower;increase 
E) lower;not change 
A) raise;decrease 
B) raise;increase 
C) lower;decrease 
D) lower;increase 
E) lower;not change

-The table above gives data for the nation of Pearl,a small island in the South Pacific.When the economy is at full employment the price level is

If the economy is above full employment,there is gap,and as the economy adjusts toward full employment,the price level .

A recession in the rest of the world means U.S.

If there is a rise in the price level,there is a(n) movement along the AS curve because there is in the quantity of real GDP supplied.

The slope of the aggregate supply curve shows that,all else the same,the

Demand pull inflation can be started by

At the beginning of 2015,a country is at full-employment.During 2015,oil-producing countries decrease oil production leading to much higher oil prices.The higher oil prices can

If the costs of production increase,there is

What two variables are determined in an aggregate supply-aggregate demand figure? Is the slope of the aggregate supply curve positive or negative? Is the slope of the aggregate demand curve positive or negative?

Demand-pull inflation starts with a shift of the

In its macroeconomic equilibrium,the economy can be producing at I.below full employment. Ii.full employment. Iii.above full employment.

The figure above shows aggregate demand curves. -Based on the figure above,the aggregate demand curve will shift from AD0 to AD1 when

If the price level increases from 110.0 to 115.0,the quantity of

A combination of declining real GDP and rising price level is referred to as

When potential GDP increases,

-What can lead to the shift illustrated in the figure above?

During 2010,a country reports that its price level fell and the money wage rate did not change.These changes led to

For a demand-pull inflation to persist requires persistent increases in

A recessionary gap occurs when so that real GDP is potential GDP.

If the money wage rate does not change,a decrease in the price level will the real wage rate and firms' profit.

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Fiscal Policy and Monetary Policy

Filters

Exam 19: Aggregate Supply and Aggregate Demand

-The table above gives data for the nation of Pearl,a small island in the South Pacific.When the economy is at full employment the price level is

If the economy is above full employment,there is ________ gap,and as the economy adjusts toward full employment,the price level ________.

A recession in the rest of the world means U.S.

If there is a rise in the price level,there is a(n)________ movement along the AS curve because there is ________ in the quantity of real GDP supplied.

The slope of the aggregate supply curve shows that,all else the same,the

Demand pull inflation can be started by

At the beginning of 2015,a country is at full-employment.During 2015,oil-producing countries decrease oil production leading to much higher oil prices.The higher oil prices can

If the costs of production increase,there is

What two variables are determined in an aggregate supply-aggregate demand figure? Is the slope of the aggregate supply curve positive or negative? Is the slope of the aggregate demand curve positive or negative?

Demand-pull inflation starts with a shift of the

In its macroeconomic equilibrium,the economy can be producing at I.below full employment. Ii.full employment. Iii.above full employment.

The figure above shows aggregate demand curves. -Based on the figure above,the aggregate demand curve will shift from AD0 to AD1 when

If the price level increases from 110.0 to 115.0,the quantity of

A combination of declining real GDP and rising price level is referred to as

When potential GDP increases,

-What can lead to the shift illustrated in the figure above?

During 2010,a country reports that its price level fell and the money wage rate did not change.These changes led to

For a demand-pull inflation to persist requires persistent increases in

A recessionary gap occurs when ________ so that real GDP is ________ potential GDP.

If the money wage rate does not change,a decrease in the price level will ________ the real wage rate and ________ firms' profit.

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Fiscal Policy and Monetary Policy

Filters

If the economy is above full employment,there is gap,and as the economy adjusts toward full employment,the price level .

If there is a rise in the price level,there is a(n) movement along the AS curve because there is in the quantity of real GDP supplied.

A recessionary gap occurs when so that real GDP is potential GDP.

If the money wage rate does not change,a decrease in the price level will the real wage rate and firms' profit.