In Keynesian multiplier equation just above, if c = .8, t = .25 and w = .1, then if "autonomous spending" increases by $100 billion, nominal GDP: a. will increase by $50 billion Joe pays a substantial portion of his income in various local, state and federal taxes. Credit cards are considered to be money because they facilitate exchange. If aggregate expenditure at a particular level of income is less than output, If aggregate expenditure is less than GDP, inventories will. Use the table below to calculate the CPI in 2007. Now, consider a balanced budget that does not cut spending but raises taxes. a. one-third b. one-sixth c. three-quarters d. one half 8. Refer to Figure 15-1. Which of the following would not cause a movement along the AD curve? The president of the Federal Reserve Bank of which district has a permanent vote in the Federal Open Market Committee?. According to Say's Law, supply creates its own demand. Refer to Figure 14-2. Refer to Figure 15-9. An example of a frictionally unemployed individual is. It compares how much money people are spending versus saving. When money is used to compare the costs of different goods and services, it is functioning as, The institution charged with creating and regulating the U.S. money supply is the. The AD curve shifts rightward if taxes decrease. Refer to Figure 8-1. Refer to Figure 8-3. What are the three important macroeconomic goals about which most economists, and society at large, agree? If there is a large increase in the price of oil, which of the following would most likely occur in the short run? a. In macroeconomics, it is impossible to include many individual markets in a single data source. Page 4 of 10 6. Which of the following is not a function of the Federal Reserve System? The U.S. agriculture sector extends beyond the farm business to include a range of farm-related industries. a. Sylvia, who quit her job to spend more time with her children. The inflation rate was 5% last year and is predicted to be 8% this year. Goods can be either durable goods, like automobiles, or nondurable goods (which are immediately consumed and used up), like gasoline. If private investment increased by $50 billion while GDP remained the same, which of the following could have occurred, all else being the same? This difference occurs because, in the more realistic view of the economy, households have only a fraction of real GDP available as disposable personal income. What are the three important macroeconomic goals about which most economist, and society at large agree? Economist monitor economic growth by keeping track of: the total quality of goods and services produced in the United States each year, real GDP rises faster than the population, The Full Employment and Balanced Growth Act of 1978 set the target unemployment rate for the United States economy at 4%, Periodic fluctuations in GDP are called business cycles, the phase of the business cycle characterized by rising output is called, Periodic fluctuations in real GDP are called, aggregation is the process of combining different things into a single category, the term laissez faire can be translated as, in macroeconomics it is impossible to include many individual markets in a single data source, GDP measues the output produced within a nations borders, Susie grows corn in her backyard garden to feed her family. Most important, spending on durable goods (goods meant to last more than three years) increased 8.8 percent in the first quarter of 2010 and 6.9 percent in … Economists monitor economic growth by keeping track of. If the unit cost of output for a car is $8000 and the price is $10,000, what is the firms' markup over cost? Suppose the current interest rate is 5% and you pay $250 for a bond. Oh no! nation – import of the nation) is the expenditure method of calculating the GDP of a country, and they all comprise the GDP’s total amount. Aggregation is the process of combining different things into a single category. Susie grows corn in her backyard garden to feed her family. GDP measures the output produced within a nation's borders. Commercial banks can increase the money supply by. the aggregate demand curve will shift to the right, Since most firms use a stable markup, price will remain stable over long periods of time, why does a change in GDP affect unit cost and the price level, as GDP increases the price of non-labor input increases and the nominal wage tends to increase, which of the following would shift the AS curve downward, if output is below the full-employment level of output we should expect wages to increase over time, Accordign to the AS/AD model in the long run expansionary monetary policy will, increase in production of good and services over long periods of time, Federal government to promote maximum employment production and purchasing power, In the factor payment approach to GDP owners of capital receive, Economist maintain that the wage rate that workers should really care about in, T/F: if inflation is fully anticipated and if there are no restrictions on contracts, then inflation will not redistribute purchasing power, a change in government purchases or net taxes designed to change total spending, quality changes; new technologies; substitution and growth in discounting, created when the government expenditures exceed net taxes, what is the price of funds in the loanable fund market, in the classical model the supply fund for the loanable market comes from, household savings and the govenment's budget surplus if any, when represented graphically the government's demand for ffunds curve is. 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