1) A mutual fund sells policies that guarantees payment to a policyholder's beneficiary when the policyholder dies

true or false

2)Domestic savings refers to savings derived from foreigners.

true or false

3)An example of a social insurance program is

social security (income to older Americans

unemployment insurance (payments to unemployed workers)

food stamps (food to low-income families)

all of the above

4) An example of expansionary fiscal policy is

raising taxes.

decreasing government spending.

lowering interest rates.

lowering taxes.

raising interest rates.

5) Yp represents __________.

potential output

potential supply

potential demand

aggregate output

6) The marginal propensity to save refers to the increase in consumer spending that occurs when disposable income increases by $1.

true or false

7) Contractionary fiscal policies decrease the aggregate demand curve.

true or false

8) MPS equals

S YD

C YD

1 - MPC

1 - MPS

A. and C.

9) The short-run aggregate supply curve can shift to the left if

productivity falls.

nominal wages fall.

commodity prices fall.

the firms' cost of production were to decrease.