Aggregate Demand and Aggregate Supply Quiz

Which of the following is a component of aggregate demand?

• Exports

• Savings

• Import tariffs

• Unemployment benefits

An increase in consumer confidence is likely to affect which component of AD?

• Government spending

• Investment

• Net exports

• Consumption

If the central bank reduces interest rates, the immediate effect on AD is most likely to be an increase in:

• Imports

• Savings

• Consumption and investment

• Government spending

Which of the following is likely to cause a leftward shift in the AD curve?

• A decrease in exports

• A decrease in income tax

• An increase in business investment

• A decrease in interest rates

An increase in government spending without a corresponding increase in taxes will:

• Shift the AD curve to the right

• Shift the AS curve to the left

• Have no effect on AD

• Cause a movement along the AD curve

If the exchange rate of a country's currency depreciates, how is AD likely to be affected?

• AD will decrease due to lower exports

• AD will decrease due to higher imports

• AD will increase due to higher exports

• AD will remain unchanged

Which of the following will increase AD?

• An increase in interest rates

• A rise in income tax

• A fall in business confidence

• An increase in consumer wealth

Which component of AD is directly affected by government spending on infrastructure projects?

• Consumption

• Government expenditure

• Net exports

• Investment

Which factor is least likely to shift the AD curve?

• Changes in consumer confidence

• Changes in the price level

• Changes in taxation

• Changes in the money supply

A fall in the general price level will result in:

• A shift of the AD curve to the left

• A shift of the AD curve to the right

• A movement along the AD curve

• No change in AD