Econ Quiz #2

Which of the following equations represents Aggregate Demand

• GDP = X + I + C + (Y - Z)

• GDP = C + I + G + (X - M)

• GDP = C + I + X + (G - T)

• GDP = (1/MPS)*G + I + C

Which of the following events will increase the Aggregate Demand in the economy. Check all that apply.

• The government increasing Income Tax

• The Fed lowering interest rates

• A rise in the cost of raw material

• A supply shock like a new production technology

• An increase in consumer confidence

If a country imports more than it exports, it is experiencing a _______________

• Budget Surplus

• Budget Deficit

• Trade Surplus

• Trade Deficit

If the government lowers taxes and increases spending, this is likely to lead to ___________ inflation

• Public-pushed

• Demand-pulled

• Cost-pushed

• Hyperinflation

Which of the following would not cause a shift in the long-run aggregate supply curve?

• An increase in the available capital

• An increase in the available labourd

• An increase in the available technologye

• An increase in price expectations

• All of these answers shift the long-run aggregate supply curve

Which of the following events shifts the short-run aggregate supply curve to the right?

• a decrease in the money supply

• a drop in oil prices

• an increase in government spending on military equipmentd

• an increase in price expectations

____________ refers to the total value of final goods and services which all the sectors of an economy are planning to buy at a given level of income during a period of one accounting year.

• aggregate demand

• aggregate supply

_____________ refers to the money value of goods and services that all the producers are willing to supply in an economy in a given time period.

• Aggregate demand

• Aggregate supply

the level of disposable income determines the level of ____________________.

• consumption expenditure

• private expenditure

• government expenditure

• net export

AD curve is a :

• horizontal straight line parallel to the X-axis

• positively sloped curve

• negatively sloped curve

• vertically straight kine parallel to the y-axis