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Other things equal,an improvement in productivity will:


A) shift the aggregate demand curve to the left.
B) shift the aggregate supply curve to the left.
C) shift the aggregate supply curve to the right.
D) increase the price level.

E) A) and B)
F) None of the above

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The following aggregate demand and supply schedules are for a hypothetical economy: The following aggregate demand and supply schedules are for a hypothetical economy: -Refer to the above data.The change in aggregate demand indicated in the previous question might have been caused by: A) an increase in net exports. B) a worsening of business expectations. C) an increase in consumer wealth. D) a decrease in the personal income tax. -Refer to the above data.The change in aggregate demand indicated in the previous question might have been caused by:


A) an increase in net exports.
B) a worsening of business expectations.
C) an increase in consumer wealth.
D) a decrease in the personal income tax.

E) A) and C)
F) C) and D)

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-Refer to the above diagram.If the aggregate supply curve shifted from AS<sub>0</sub> to AS<sub>1</sub>,we could say that: A) aggregate supply has increased,equilibrium output has decreased,and the price level has increased. B) aggregate supply has decreased,equilibrium output has decreased,and the price level has increased. C) an increase in the amount of output supplied has occurred. D) aggregate supply has increased and the price level has risen to G. -Refer to the above diagram.If the aggregate supply curve shifted from AS0 to AS1,we could say that:


A) aggregate supply has increased,equilibrium output has decreased,and the price level has increased.
B) aggregate supply has decreased,equilibrium output has decreased,and the price level has increased.
C) an increase in the amount of output supplied has occurred.
D) aggregate supply has increased and the price level has risen to G.

E) B) and C)
F) A) and B)

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Refer to the information below.A change in net export spending would most likely be caused by changes in: The following list of factors is related to the aggregate demand curve. Refer to the information below.A change in net export spending would most likely be caused by changes in: The following list of factors is related to the aggregate demand curve. A) 2 and 3. B) 5 and 6. C) 7 and 8. D) 6 and 9.


A) 2 and 3.
B) 5 and 6.
C) 7 and 8.
D) 6 and 9.

E) B) and C)
F) A) and B)

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An increase in net exports can be expected to shift the:


A) aggregate expenditures curve upward and the aggregate demand curve rightward.
B) aggregate expenditures curve upward and the aggregate demand curve leftward.
C) aggregate expenditures curve downward and the aggregate demand curve rightward.
D) aggregate expenditures curve downward and the aggregate demand curve leftward.

E) C) and D)
F) A) and D)

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List three events that would shift the short-run aggregate supply curve leftward.

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Some possibilities are a rise in the pri...

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If there is a decrease in the price level,then it will increase aggregate expenditures and this change is equivalent to a(n) :


A) increase in aggregate supply.
B) increase in aggregate demand.
C) decrease in aggregate demand.
D) movement along an aggregate demand curve.

E) C) and D)
F) All of the above

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-Refer to the above diagram.At the equilibrium price and quantity: A) aggregate demand exceeds aggregate supply. B) the amount of real output demanded and supplied are equal. C) aggregate demand equals aggregate supply. D) aggregate supply exceeds aggregate demand. -Refer to the above diagram.At the equilibrium price and quantity:


A) aggregate demand exceeds aggregate supply.
B) the amount of real output demanded and supplied are equal.
C) aggregate demand equals aggregate supply.
D) aggregate supply exceeds aggregate demand.

E) C) and D)
F) B) and D)

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The economy experiences an increase in the price level and a decrease in real domestic output.Which is a likely explanation?


A) productivity has increased
B) input prices have increased
C) excess capacity has decreased
D) government regulations have been reduced

E) A) and D)
F) A) and C)

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A change in business taxes and regulation can affect input prices and aggregate supply.

A) True
B) False

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What determines the equilibrium price level and the level of real GDP in the aggregate demand-aggregate supply (short-run)model?

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The interaction of short-run aggregate s...

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The foreign trade effect:


A) shifts the aggregate demand curve rightward.
B) shifts the aggregate demand curve leftward.
C) shifts the aggregate supply curve rightward.
D) does none of the above.

E) C) and D)
F) A) and B)

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In the late 1990s and early 2000s:


A) both AD and AS increased
B) inflation was relatively high.
C) AD increased but AS decreased.
D) AD decreased but AS increased.

E) C) and D)
F) A) and B)

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-Refer to the above diagram.If aggregate supply is AS<sub>1</sub> and aggregate demand is AD<sub>0</sub>,then: A) at any price level above G a shortage of real output would occur. B) F represents a price level which would result in a surplus of real output of AC. C) a surplus of real output of GH would occur. D) F represents a price level which would result in a shortage of real output of AC. -Refer to the above diagram.If aggregate supply is AS1 and aggregate demand is AD0,then:


A) at any price level above G a shortage of real output would occur.
B) F represents a price level which would result in a surplus of real output of AC.
C) a surplus of real output of GH would occur.
D) F represents a price level which would result in a shortage of real output of AC.

E) B) and C)
F) A) and C)

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Cost-push inflation occurs because of a:


A) rightward shift in the aggregate demand curve.
B) leftward shift in the aggregate demand curve.
C) rightward shift in the aggregate supply curve.
D) leftward shift in the aggregate supply curve.

E) B) and C)
F) All of the above

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Economists think of three different aggregate supply curves based upon the time frame of observation.Briefly describe each.

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The aggregate supply curve describes the...

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What are five reasons for the downward price-level inflexibility,especially as it pertains to wages and prices?

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First,wage contracts will fix wages for ...

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Which of the following is true of aggregate supply in the long run?


A) Nominal wages and output prices are both fixed.
B) Nominal wages are fixed but output prices can vary.
C) Output prices are fixed.
D) Nominal wages are fully responsive to changes in the price level.

E) All of the above
F) A) and C)

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The following table is for a particular country in which C is consumption expenditures,Ig is gross investment expenditures,G is government expenditures,X is exports,and M is imports.All figures are in billions of dollars.Each question is independent of the other questions. The following table is for a particular country in which C is consumption expenditures,I<sub>g</sub> is gross investment expenditures,G is government expenditures,X is exports,and M is imports.All figures are in billions of dollars.Each question is independent of the other questions. -Refer to the above table.If the aggregate supply schedule intersects the aggregate demand at price level 119 in this country,its equilibrium level of real GDP will be: A) $37 billion. B) $35 billion. C) $26 billion. D) $43 billion. -Refer to the above table.If the aggregate supply schedule intersects the aggregate demand at price level 119 in this country,its equilibrium level of real GDP will be:


A) $37 billion.
B) $35 billion.
C) $26 billion.
D) $43 billion.

E) B) and C)
F) A) and B)

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Identify the ways in which each of the following determinants would have to change to cause a decrease in aggregate demand: consumer wealth,consumer expectations,business taxes,national income in countries abroad,exchange rates.

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To decrease aggregate demand,consumer we...

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