A negative aggregate supply shock will result in which of the following in the short run?
An increase in the purchases of newly constructed houses will result in which of the following?
In the short run, a reduction in the money supply will cause
A country’s economy is currently in equilibrium at point R. Which of the following policy actions could the country’s government take to achieve potential output (YP) ?
Which of the following is LEAST likely to affect the long-run growth of an economy?
An economy experiences a sharp increase in energy prices, and policy makers adopt a stabilization policy to increase aggregate demand. Compared with the initial short-run equilibrium, which of the following will definitely occur?
Assume that the marginal propensity to consume is 0.8. If the government increases its purchases of goods and services by $200 and exports decline by $50, at most the equilibrium level of income will
If the short-run aggregate supply curve is upward sloping, which of the following will cause inflation?
The economy is currently in long-run equilibrium. If the central bank increases the money supply, in the long run the price level will
Which of the following will occur in the money market when the aggregate price level increases?
Increases in government subsidies to encourage investment in research and development will affect aggregate demand (AD) and long-run aggregate supply (LRAS) in which of the following ways?
An increase in the expected inflation rate will cause the
Which of the following is true about the Phillips curve?
The long-run Phillips curve indicates that there are no trade-offs between
Which of the following would cause a movement from point S to point R on the short-run Phillips curve above?
Based on the graph above, demand-pull inflation is caused by a movement from
Assume that the marginal propensity to consume is 0.75, net exports decline by $10 billion, and government spending increases by $20 billion. Given that there is no crowding out, the equilibrium gross domestic product can increase by a maximum of
Which of the following will most likely result in an increase in aggregate demand?
Assume a country’s economy is currently in long-run equilibrium. What is the long-run effect of an increase in aggregate demand?
In a closed economy with lump sum taxes, if the marginal propensity to consume increased from 0.5 to 0.75, the simple multiplier and the marginal propensity to save (MPS) would change in which of the following ways?
In an economy the MPC is 0.90, and the GDP is $100 Billion. If gross private domestic investment declines by $2 Billion, then GDP will
According to the income and consumption schedules shown above, the marginal propensity to consume is
Suppose that the economy is in the midst of a recession and government policy makers want to increase aggregate demand by $600 billion. If the economy's MPC is 0.75 and there is no crowding out, the government should do which of the following?