3. GDP in 2016 would include which of the following transactions? (2) a) The purchase of a 2010 VW Beetle b) The purchase of 2,000 shares of Microsoft c) A ticket to a screening of the 1962 classic Lawrence of Arabia d) Ron receives a $2,000 pension cheque from the government e) Ali sells his old golf clubs for $173 Explain your choice in a few words. 4. Which of the following would cause the price level to fall in the short run? Draw a diagram to show the correct answer. (2) a) A decrease in the price of an energy source such as natural gas b) An increase in consumer disposable income c) An increase in the wage rate d) A decrease in imports (exports remaining the same) e) An increase in exports (imports remaining the same) 5. According to the Keynesian model, equilibrium output of an economy may be greater than the fullemployment or potential level of output. What is this situation called? Draw a diagram of such a situation. Suggest one action (and possible reaction) that could cause short-run equilibrium to move towards long-run equilibrium and show this on the diagram. Show cause and effect clearly using shorthand or words. (6) 6. Why did Keynes say that savings during a recession/depression is not good for the economy? What did he call this? Explain how this works by means of a diagram or in words. (6) [7. A change in the interest rate has a significant effect on consumption due to a substantial change in people's savings habits. Indicate the correct choice. (1) True False 8. If the central bank tightened the growth of liquidity in the economy by 10% select the option that best represents what would happen as a result. (3) INTEREST RATE AGGREGATE DEMAND a) Increase Increase b) Increase Decrease c) Decrease Decrease d) Decrease Increase Explain the reasoning behind your choice