Unit 4 Topic 1 Mid review

Which of the following best describes aggregate demand in an economy?

• The total supply of goods and services produced within a country

• The total expenditure at a given overall price level and in a given period

• The demand for a single product in the market

• The total exports minus imports

An increase in consumer confidence is most likely to cause which of the following?

• A decrease in aggregate demand

• An increase in aggregate demand

• A decrease in aggregate supply

• No change in aggregate demand

Which of the following would shift the aggregate supply curve to the right?

• An increase in wage rates

• A decrease in productivity

• A technological advancement

• An increase in taxes on businesses

If the government increases its spending, what is the most likely immediate effect on aggregate demand?

• Aggregate demand decreases

• Aggregate demand increases

• Aggregate supply increases

• Aggregate supply decreases

A rise in the general price level, with no change in output, is most likely caused by:

• An increase in aggregate demand beyond full employment

• A decrease in aggregate supply

• An increase in aggregate supply

• A decrease in aggregate demand to below full employment

If the Australian dollar appreciates, what is the likely effect on aggregate demand?

• Aggregate demand increases due to higher exports

• Aggregate demand decreases due to lower exports

• Aggregate supply increases

• Aggregate supply decreases

Which of the following is most likely to increase aggregate supply in the long run?

• Higher business taxes

• Improved education and training

• Increased import tariffs

• Higher minimum wage

A decrease in aggregate demand will most likely result in:

• Higher output and higher prices

• Lower output and lower prices

• Higher output and lower prices

• Lower output and higher prices

Which of the following equations best represents aggregate demand?

If oil prices rise sharply, what is the most likely effect on aggregate supply?

• Aggregate supply increases

• Aggregate supply decreases

• Aggregate demand increases

• Aggregate demand decreases