Supply-side economists argue that changes in tax rates cause changes in A) labor supply. B) the full-employment level of output. C) saving. D) all of the above. ANSWER D
Date: September 2nd, 2020
Assume the economy is closed and that it is operating at full employment. Which statement is TRUE when the size of the budget deficit decreases? A) The increased amount of public goods will crowd out privately produced goods. B) A reduction in the growth of productivity, and a reduction in society’s standard of living will […]
Date: September 2nd, 2020
An automobile manufacturer decides to increase its retained earnings. Assuming all else equal, this will cause: A) a downward movement along the current credit supply curve of the firm. B) the current credit supply curve of the firm to shift to the left. C) the current credit supply curve of the firm to shift to […]
Date: September 2nd, 2020
When the interest rate increases, people will adjust their precautionary demand for money A) downward or upward depending upon the actual supply of money. B) upward. C) not at all. D) downward. ANSWER D
Date: September 2nd, 2020
The average price of a share of stock on the New York Stock Exchange falls by 30 percent. Other things being equal, we would expect A) a shift up of the consumption function. B) an increase in the marginal propensity to consume. C) a decrease in the marginal propensity to consume. D) a shift down […]
Date: September 2nd, 2020
If the Fed buys bonds from a private bank, ________. A) the Fed’s total liabilities will remain unaffected B) the Fed’s total assets will remain unaffected C) the private bank’s composition of assets will change D) the private bank’s total assets will increase ANSWER C
Date: September 2nd, 2020
In the above figure, the long-run equilibrium real GDP is A) $10 trillion. B) $11 trillion. C) $12.trillion D) not displayed. ANSWER B
Date: September 2nd, 2020
If consumers’ confidence in the economy rises A) aggregate demand will shift rightward and the price level will rise. B) aggregate demand will shift leftward and the price level will fall. C) aggregate demand will shift rightward and the price level will fall. D) aggregate demand will shift leftward and the price level will rise. […]
Date: September 2nd, 2020
The liquidity of money refers to A) the amount of gold it is backed by. B) how quickly it can be disposed of without high transaction costs. C) asymmetric information. D) the standard of deferred payments and how quickly those payments can be made. ANSWER B
Date: September 2nd, 2020
Which of the following statements is TRUE? A) APC + APS < 1 B) APC + APS + MPC + MPS = 1 C) APC + MPS = 1 D) APC + APS = 1 ANSWER D
Date: September 2nd, 2020
