The Keynesian short-run aggregate supply curve A) reflects the fact that real GDP is supply-determined. B) reflects the fact that real GDP does not vary with changes in aggregate demand. C) is vertical. D) is horizontal. ANSWER D
Date: September 2nd, 2020
How is economic growth graphically depicted? A) The long-run aggregate supply curve shifts right. B) Aggregate demand shifts to the right. C) Short-run aggregate supply shifts left. D) The aggregate demand curve shifts to the left. ANSWER A
Date: September 2nd, 2020
A highly liquid asset A) generally has a very limited market for its resale. B) has high transaction costs associated with its sale. C) must be held for a substantial period of time. D) can be disposed of easily without loss of value. ANSWER D
Date: September 2nd, 2020
What are the two important properties of all models? What will be an ideal response? ANSWER a) All models are approximations: Models cannot predict how a certain change in a particular variable will affect all individuals in the population. Instead, it predicts what will happen to most people in most circumstances. Thus, any model […]
Date: September 2nd, 2020
What is meant by the term “scientific method”? What are the key components of the scientific method? What will be an ideal response? ANSWER The scientific method is the name for the ongoing process that economists, social scientists, and natural scientists use to develop models of the world and test those models with data. […]
Date: September 2nd, 2020
If an asset can be obtained or disposed of without much risk of losing its nominal value, it is said to be A) valuable. B) wealth. C) fiduciary. D) liquid. ANSWER D
Date: September 2nd, 2020
Marginal propensity to consume A) is the amount of consumption that is independent of the level of disposable income. B) is the same as the break-even point. C) is the proportion of total disposable income that is consumed. D) gives the amount a person changes planned consumption for a change in real disposable income. […]
Date: September 2nd, 2020
Supply-side economics focuses attention on how fiscal policy might be used to A) shift the aggregate supply curve out. B) increase consumption. C) align aggregate demand and aggregate supply. D) increase aggregate demand to the full-employment level of real GDP. ANSWER A
Date: September 2nd, 2020
Assuming all else equal, if an airline company decides to purchase new planes, it is likely to cause: A) a downward movement along its credit demand curve. B) its credit demand curve to shift to the right. C) an upward movement along its credit demand curve. D) its credit demand curve to shift to the […]
Date: September 2nd, 2020
A rightward shift of the labor demand curve during a recession due to a government policy leads to ________ if wages are flexible. A) a fall in prices B) a decrease in real wages C) a fall in interest rates D) an increase in employment ANSWER D
Date: September 2nd, 2020
