Question :
111.Andecreaseintaxesshiftsaggregatedemand
a.totheright.Thelargerthemultiplieris,thefartheritshifts.
b.totheright.Thelargerthemultiplieris,thelessitshifts.
c.totheleft.Thela : 1262216
111.Andecreaseintaxesshiftsaggregatedemand
a.totheright.Thelargerthemultiplieris,thefartheritshifts.
b.totheright.Thelargerthemultiplieris,thelessitshifts.
c.totheleft.Thelargerthemultiplieris,thefartheritshifts.
d.totheleft.Thelargerthemultiplieris,thelessitshifts.
112.IfCongressincreasestaxestobalancethefederalbudget,thentopreventunemploymentandarecessiontheFedwill
a.reduceinterestratesbyincreasingthemoneysupply.
b.increaseinterestratesbydecreasingthemoneysupply.
c.increaseinterestratesbyincreasingthemoneysupply.
d.reduceinterestratesbydecreasingthemoneysupply.
113.Anincreaseingovernmentspendingshiftsaggregatedemand
a.totheright.Thelargerthemultiplieris,thefartheritshifts.
b.totheright.Thelargerthemultiplieris,thelessitshifts.
c.totheleft.Thelargerthemultiplieris,thefartheritshifts.
d.totheleft.Thelargerthemultiplieris,thelessitshifts.
114.Whengovernmentexpendituresincrease,theinterestrate
a.increases,makingthechangeinaggregatedemandlarger.
b.increases,makingthechangeinaggregatedemandsmaller
c.decreases,makingthechangeinaggregatedemandlarger.
d.decreases,makingthechangeinaggregatedemandsmaller.
115.Whentaxesincrease,theinterestrate
a.increases,makingthechangeinaggregatedemandlarger.
b.increases,makingthechangeinaggregatedemandsmaller
c.decreases,makingthechangeinaggregatedemandlarger.
d.decreases,makingthechangeinaggregatedemandsmaller.
116.In2009PresidentObamaandCongressincreasedgovernmentspending.Someeconomiststhoughtthisincreasewouldhavelittleeffectonoutput.Whichofthefollowingwouldmaketheeffectofanincreaseingovernmentexpendituresonaggregatedemandsmaller?
a.theinterestratefallsandaggregatesupplyisrelativelyflat
b.theinterestratefallsandaggregatesupplyisrelativelysteep
c.theinterestraterisesandaggregatesupplyisrelativelyflat
d.theinterestraterisesandaggregatesupplyisrelativelysteep
117.In2009PresidentObamaandCongressincreasedgovernmentspending.Someeconomiststhoughtthisincreasewouldhavelittleeffectonoutput.Whichofthefollowingwouldmaketheeffectofanincreaseingovernmentexpendituresonaggregatedemandsmaller?
a.theMPCissmallandchangesintheinterestratehaveasmalleffectoninvestment
b.theMPCissmallandchangesintheinterestratehavealargeeffectoninvestment
c.theMPCislargeandchangesintheinterestratehaveasmalleffectoninvestment
d.theMPCislargeandchangesintheinterestratehavealargeeffectoninvestment
118.Whichofthefollowingeffectsresultsfromthechangeintheinterestratecreatedbyanincreaseingovernmentspending?
a.theinvestmentacceleratorandcrowdingout
b.theinvestmentacceleratorbutnotcrowdingout
c.crowdingoutbutnottheinvestmentaccelerator
d.neithercrowdingoutnortheinvestmentaccelerator
119.Whichofthefollowingareeffectsofanincreaseingovernmentspendingfinancedbyataxincrease?
a.thetaxincreasereducesconsumption;thechangeintheinterestratereducesresidentialconstruction
b.thetaxincreasereducesconsumption;thechangeintheinterestrateraisesresidentialconstruction
c.thetaxincreaseraisesconsumption;thechangeintheinterestratereducesresidentialconstruction
d.thetaxincreaseraisesconsumption;thechangeintheinterestratereducesresidentialconstruction
120.Thereisanincreaseingovernmentexpendituresfinancedbytaxesanditsoverallshort-runeffectonoutputislargerthanthechangeingovernmentspending.Whichofthefollowingiscorrect?
a.Bythemselves,boththechangeinoutputandthechangeintheinterestrateincreasedesiredinvestment.
b.Bythemselves,boththechangeinoutputandthechangeintheinterestratedecreasedesiredinvestment.
c.Byitself,thechangeinoutputincreasesdesiredinvestmentspendingandbyitselfthechangeintheinterestratedecreasesdesiredinvestmentspending.
d.Byitself,thechangeinoutputdecreasesdesiredinvestmentspendingandbyitselfthechangeintheinterestrateincreasesdesiredinvestmentspending.
121.Thegovernmentincreasesbothitsexpendituresandtaxesby$400billion.Thereisnocrowdingoutandnoacceleratoreffect.Aggregatedemandshiftsby$400billion.Whichofthefollowingisconsistentwithhowfaraggregatedemandshifts?
a.MPC=1/2,andtheeffectsoftheincreaseintaxesis1/2asstrongasthechangeingovernmentexpenditures.
b.MPC=2/3,andtheeffectsoftheincreaseintaxesis2/3asstrongasthechangeingovernmentexpenditures
c.MPC=3/4,andtheeffectsoftheincreaseintaxesis3/4asstrongasthechangeingovernmentexpenditures
d.Alloftheabovearecorrect.
122.Assumethatthereisnoacceleratoraffect.TheMPC=3/4.Thegovernmentincreasesbothexpendituresandtaxesby$600.Theeffectoftaxesonaggregatedemandis3/4thesizeofthatcreatedbygovernmentexpendituresalone.Thecrowdingouteffectis1/5asstrongasthecombinedeffectofgovernmentexpendituresandtaxesonaggregatedemand.Howmuchdoesaggregatedemandshiftby?
a.$1480
b.$480
c.$160
d.Noneoftheaboveiscorrect.
123.Assumethefollowing.
a.b = 0
b.b = 0.2
c.b = 0.8
d.b = 1