Question 120 / 1 point

The value of the expenditure multiplier will increase if the ____.

a.marginal propensity to save decreases

b.marginal propensity to consume decreases

c.marginal tax rate increases

d.marginal propensity to import increases

Question 130 / 1 point

Which of the following events is likely to trigger an automatic fiscal policy change in Canada?

A recession

a.An increase in property taxes

b.A cut in personal income rate

c.A decrease in transfer payment by the federal government

d.An increase in federal government spending on education

Question 140 / 1 point

Which of the following policies will NOT increase aggregate demand?

a.An increase in transfer payments

b.An increase in government expenditure on goods and services

c.A decrease in taxes

d.A decrease in the government deficit

Question 150 / 1 point

At the equilibrium expenditure ________.

a.aggregate planned expenditure equals the quantity of real GDP produced

b.purchasers will be prone to bid up prices

c.an increase in planned expenditure cannot increase real GDP

d.there can be unplanned inventory accumulation

Question 160 / 1 point

Which of the following describes a possible effect of a fall in the real interest rate?

a.Both the consumption and saving functions shift downward.

b.Both the consumption and saving functions shift upward.

c.The consumption function shifts upward and the saving function shifts downward.

d.The consumption function shifts downward.

e.The saving function shifts upward.

Question 170 / 1 point

The component of aggregate expenditure which does NOT vary with the level of real GDP is known as

a.actual expenditure.

b.planned expenditure.

c.autonomous expenditure.

d.induced expenditure.

e.aggregate demand.