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Lecture

ECON 1BB3 Lecture Notes - Aggregate Supply, Aggregate Demand, Autarky

2 Pages
121 Views
Fall 2013

Department
Economics
Course Code
ECON 1BB3
Professor
Bridget O' Shaughnessy

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Chapter 14-15 Tutorial Quiz
1. Which of the following happens to aggregate demand if people want to save
more for retirement and the government raises taxes?
a.
Aggregate demand shifts right.
b.
Aggregate demand shifts left.
c.
If people save more, aggregate demand shifts right; f the government
raises taxes, aggregate demand shifts left.
d.
If people save more, aggregate demand shifts left; if the government
raises taxes, aggregate demand shifts right.
2. Which of the following is consistent with the theory of aggregate supply?
a.
An increase in the expected price level shifts the short-run aggregate
supply curve to the right, and an increase in the actual price level
shifts the short-run aggregate supply to the right.
b.
An increase in the expected price level shifts the short-run aggregate
supply curve to the right, and an increase in the actual price level does
not shift the short-run aggregate supply.
c.
An increase in the expected price level shifts the short-run aggregate
supply curve to the left, and an increase in the actual price level shifts
the short-run aggregate supply to the left.
d.
An increase in the expected price level shifts the short-run aggregate
supply curve to the left, and an increase in the actual price level does
not shift the short-run aggregate supply.
3. Assume that the MPC is 0.75. Assume that there is a multiplier effect and that the
total crowding-out effect is $3 billion. How will a decrease in government
purchases of $10 billion shift aggregate demand?
a.
It will shift aggregate demand left by $7 billion.
b.
It will shift aggregate demand left by $37 billion.
c.
It will shift aggregate demand left by $43 billion.
d.
It will shift aggregate demand right by $7 billion.

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Description
Chapter 14-15 Tutorial Quiz 1. Which of the following happens to aggregate demand if people want to save more for retirement and the government raises taxes? a. Aggregate demand shifts right. b. Aggregate demand shifts left. c. If people save more,aggregate demand shifts right; f the government raises taxes, aggregate demand shifts left. d. If people save more, aggregate demand shifts left; if the government raises taxes, aggregate demand shifts right. 2. Which of the following is consistentwith the theory of aggregate supply? a. An increase in the expected price level shifts the short-run aggregate supply curve to the right, and an increase in the actual price level shifts the short-run aggregate supply to the right. b. An increase in theexpected price level shifts the short-run aggregate supply curve to the right, and an increase in the actual price level does not shift the short-run aggregate supply. c. An increase in the expected price level shifts the short-run aggregate supply curveto the left, and an increase in the actual price level shifts the short-run aggregate supply to the left. d. An increase in the expected price level shifts the short-run aggregate supply curve to the left, and an increase in the actual price level does not shift the short-run aggregate supply. 3. Assume that the MPCis 0.75. Assume that there is a multiplier effect and that the total crowding-out effect is $3 billion. How will a decrease in government purchases of $10 billion shift
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