Which of the following statements is TRUE? A) consumption – investment = disposable income B) consumption – saving = personal income C) consumption + saving = disposable income D) consumption + saving = personal income ANSWER C
Date: September 2nd, 2020
In a classical model A) equilibrium real GDP is demand determined. B) equilibrium real GDP is neither determined by aggregate supply nor by aggregate demand. C) equilibrium real GDP is determined by both aggregate supply and aggregate demand. D) equilibrium real GDP is supply determined. ANSWER D
Date: September 2nd, 2020
The aggregate demand curve is usually A) downward sloping. B) vertical. C) horizontal. D) upward sloping. ANSWER A
Date: September 2nd, 2020
The condition of fully flexible wages and prices was assumed by A) no economists. B) the classical economists. C) modern economists. D) the Keynesian economists. ANSWER B
Date: September 2nd, 2020
Which of the following statements is TRUE? A) investment = disposable income + consumption B) saving = personal income + consumption C) saving = personal income – consumption D) saving = disposable income – consumption ANSWER D
Date: September 2nd, 2020
What is measured on the horizontal axis of the aggregate demand/aggregate supply model? A) real wealth B) real Gross Domestic Product (GDP) C) prices D) nominal income ANSWER B
Date: September 2nd, 2020
The horizontal axis for an aggregate demand curve measures A) output of all goods and services measured as a quantity index. B) real Gross Domestic Product (GDP). C) quantity demanded of the representative good. D) disposable personal income. ANSWER B
Date: September 2nd, 2020
According to classical theory, any changes in aggregate demand will A) have no affect on prices or real Gross Domestic Product (GDP). B) lead to changes in both real Gross Domestic Product (GDP) and the price level. C) lead to changes in the price level. D) lead to changes in real Gross Domestic Product (GDP), […]
Date: September 2nd, 2020
Other things being equal, an increase in consumption spending implies A) a decline in saving. B) that economic growth will soon increase. C) a higher standard of living in the future. D) a decline in government spending. ANSWER A
Date: September 2nd, 2020
The difference between savings and saving A) is nonexistent. B) is that savings is measured in real terms while saving is measured in nominal terms. C) is that savings is a stock concept and saving is a flow concept. D) is that savings occurs when consumption does not and saving is used to purchase consumption […]
Date: September 2nd, 2020
