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Exam 12: B: Aggregate Demand and Aggregate Supply

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Question 21

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Other things equal, a reduction in personal and business taxes can be expected to:

A) increase aggregate demand and decrease aggregate supply.
B) increase both aggregate demand and aggregate supply.
C) decrease both aggregate demand and aggregate supply.
D) decrease aggregate demand and increase aggregate supply.

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

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Question 22

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Refer to the diagram below.Other things equal, a shift of the aggregate supply curve from AS₀ to AS₁ might be caused by a(n) :

A) increase in government regulation.
B) increase in aggregate demand.
C) increase in productivity.
D) decline in nominal wages.

E) C) and D)
F) None of the above

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Question 23

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Refer to the table below that shows the data of a country. The table given above is for a particular country in which C is consumption expenditures, I_g is gross investment expenditures, G is government expenditures, X is exports, and M is imports.All the figures are in billions of dollars.If the country's aggregate supply curve is a vertical line at the $25 billion level of real GDP, the price level will be:

A movement downward along an existing aggregate demand curve is equivalent to a(n) :

The following aggregate demand and aggregate supply schedules are for a hypothetical economy. Refer to the data above.The vertical range of the aggregate supply curve is associated with price levels:

In the late 1990s and early 2000s:

The short run aggregate supply 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.Real-balances effect Household expectations Interest-rate effect Personal income tax rates Profit expectations National income abroad Government spending Foreign trade effect Exchange rates Degree of excess capacity

A change in the price level products a?

An increase in government spending can be expected to shift the:

Per unit production cost is:

Which would be considered to be one of the factors that shift the aggregate supply curve? A change in:

The passage of new legislation requiring more extensive government regulation of business will most likely:

If real output rises and the price level falls, this would likely be due to a:

In the short run, the aggregate supply curve of an economy is:

Which of the above diagrams best portrays the effects of a decrease in the availability of key natural resources?

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

Suppose that real domestic output in an economy is 20 units, the quantity of inputs is 10, and the price of each input is $4.The per unit cost of production in the economy described above is:

Refer to the diagram given below. If aggregate supply shifts from AS₁ to AS₂, then the price level will:

An economy is employing 2 units of capital, 5 units of raw materials, and 8 units of labour to produce its total output of 640 units.Each unit of capital costs $10, each unit of raw materials, $4, and each unit of labour, $3.Refer to the above information.As a result of the change indicated in the previous question, the aggregate: