\fquestion 13 Not yet answered Points out at t m v Flag question Quosen 14 Not yet answeled Palms out oi I 00 pt Flag question Question 15 Not yet answered Palms out at t on tv Flag Queshon Quun'on 16 Not yet answered Points out at 1 00 v Flag question question 17 Not yet answered Palms out at t m v Flag question Question 18 Not yet answered Pmnls cut ct t 00 l\" Fiat: quesllun in me neoclassical View. the economy has a N) move back to potential GDP. Select one: o a. selicorrecting tendency o b. rational tendency o c tendency to be unable c d. irrational tendency Keynes argued that the was unable to keep the economy at lull employment. As a result, the should take an active role in managing the economy, Selectone. o a private sector; corporations 0 b. private sector; government 0 c public sector; government 0 d. public: corporations. Keynes believed (hat economies ale driven in the Select one: o a. demand:snon-run. o 1). supply; snort-run. O c. demandilong-run o d. supply; long-run. Keynes understood that in the short-run wages and anes are and therelore encourage the use at to return an economy to equilibrium. Select one: o a. exible, monetary policy 0 p. rigid;nscaipolicy c c. rigid: monetary policy 0 d. sticky: monetary Keynss' Law says that demand creates its own supply. in the Keynesian zone oi the short-run aggregate supply curve. howls this law supported? Select one: o a. When aggregate supply decreases, prices and outputs remain the same. 0 b. increasing aggregate demand changes prices relatively little, bul does etiectiyely increase aggregate outputs because oi the excess capacity in the economy. 0 c When aggregate demand decreases, prices remain relatively static and outputs remain unchanged because the economy lacks excess capacity. 0 d. Aggregate demand either increasing or decreasing has a large eitect on prices and little eecl on aggregate supply because the economy is close to lull capacity. Keynesian economics explains that recessions and depressions occur because: Select one: o a. there are long-term shine in aggregate supply. 0 b. the macroeconomy may adjust only slowly to shirts in aggregate demand because wages are sticky, o c the COLA is reclining. o d. aggregate demand is high enough to motivate iirms to operate at lull employment. Quesm" 26 A rightwards shift of the AD curve along the Neoclassical portion of the aggregate supply curve will result in Not yet answered Select one: :235 0'1\"\" Q a. an increase in the price level. \\V Hag O b. a decrease In the price level. queslion O c. the GDP deator moving. Q d. no effect on the price level. Ques'i'm 27 According to Keynes what should the government do to improve economic conditions during a recession? Not yet answerEd Select one: :23\" Ut 0f 0 a. increase government spending and/or decrease taxes \\7 Hag O b. reduce corporate spending and/or decrease taxes, quesllon O 0. reduce government spending and increase taxes. 0 d. increase spending and/or increase taxes. \fNew\" 29 According to the Keynesian perspective, reasons for an increase in aggregate demand include Not yet answered Select one: 0 a. the GDP deflator moving. Points out of 1.00 \\V Flag 0 b. increase in foreign demand for net exports. question 0 0. decrease in foreign demand for net exports. Q d. relative price increase of US. goods. Question 30 Not yet answered Points out of 1.00 \\V Flag questlon Price Level Real GDP Consider the neoclassical zone in the graph above. Which of the following is a true statement about Say's Law in the neoclassical zone? Select one: Q a. Because equilibrium is close to or at potential GDP, unemployment is affected by shifts in the aggregate demand curve. O b. Shifts of the AD curve have little to no effect on supply output because the LRAS at full output is creating demand. 0 c. Movement of the AD curve to the right or to the left shifts the LRAS curve. 0 d. A movement along the consumer price index shifts the aggregate demand curve. Question 7 government spending increases by $4 billion and real GDP increases by $8 billion, the expenditure multiplier must be Not yet answered Select one: Points out of 1.00 O a. 1.0 P Flag O b. 3.0 question c. 1.5 O d. 2.0 Question 8 If the expenditure multiplier is 2.5 and the government spending increases by $4 billion, what would be the increase in the real GDP? Not yet answered Select one: Points out of 1.00 O a. $6.5 billion Flag O b. $8 billion question O c. $1.6 billion O d. $10 billion Question 9 If the MPC is 75%, what is the spending multiplier? Not yet answered Select one: Points out of 100 O a. 4 Flag O b. 1.0 question O c. 1.33 O d. .75 Question 10 If U.S. goods are relatively cheaper compared with goods of foreign places, then U.S. exports are likely to rise. This would make the aggregate demand curve Not yet answered Select one: Points out of 1.00 O a. shift to the right Flag O b. shift to the left question O c. remain the same O d. move along the line Question 11 If you hear someone say, "If you build (produce) it they will come (purchase)" you know it is a good way to describe Not yet answered Select one: Points out of 1.00 a. Intermediate economics Flag O b. Keynesian economic policy question O c. Say's Law O d. Short-run economics Question 12 n the neoclassical view of the economy, expansionary fiscal policy cannot work to raise equilibrium output because Not yet answered Select one: Points out of 1.00 O a. in-kind variables would erode any gains. Flag b. flexible prices will eventually choke off any increase in aggregate demand. question O c. it will disincentivize production. O d. it will raise unemployment