Question : 31.Which of the following will occur if aggregate demand below : 1232947

31.Which of the following will occur if aggregate demand is below full-employment GDP?   

A. Recession

B. Excessive aggregate demand

C. Inflation

D. A stable economy

32.Which of the following will occur if aggregate demand is above full-employment GDP?   

A. Recession

B. Unemployment

C. Inflation

D. A stable economy

33.According to Keynes, which of the following is always true at macro equilibrium?   

A. The economy achieves full employment

B. Aggregate demand is inadequate

C. Prices are at the appropriate level

D. Aggregate demand equals aggregate supply

34.Which of the following is true about Keynes?   

A. He focused primarily on reducing inflation by shifting aggregate supply

B. He was a classical economist and prescribed a policy of laissez faire

C. He believed aggregate demand could be inadequate to ensure full employment

D. He was opposed to government intervention in the economy

35.According to Keynes, which of the following is possible at the intersection of aggregate supply and aggregate demand?   

A. Full employment or high levels of unemployment, but not inflation

B. Inflation, full employment, or high levels of unemployment

C. Inflation and high levels of unemployment, but not full employment

D. Full employment, but not high levels of unemployment or inflation

36.Which of the following is consistent with what Keynes believed?   

A. Markets automatically self-adjust to full employment very quickly

B. The economy is inherently stable

C. Monetary policy should be used to shift the aggregate supply curve

D. Fiscal policy should be used to shift the aggregate demand curve

37.Between 1921 and 1927, the stock market’s value more than doubled, adding billions of dollars to the wealth of U.S. households and businesses. Which of the following indicates the appropriate change in the U.S. economy?   

A. The economy moved up along the aggregate demand curve

B. The economy moved down along the aggregate demand curve

C. Aggregate demand shifted to the left

D. Aggregate demand shifted to the right

38.On October 24, 1929, the stock market crashed. By the end of the year, over $40 billion of wealth had vanished. Which of the following indicates the appropriate change in the U.S. economy?   

A. The economy moved up along the aggregate demand curve.

B. The economy moved down along the aggregate demand curve.

C. Aggregate demand shifted to the left.

D. Aggregate demand shifted to the right.

39.Most of the countries in the world suffered long and deep losses of output and employment between 1930 and 1935, which in turn meant fewer purchases of U.S. goods and services. Which of the following indicates the appropriate change in the U.S. economy?   

A. Aggregate demand shifted to the left

B. Aggregate demand shifted to the right

C. The economy moved up along the aggregate demand curve

D. The economy moved down along the aggregate demand curve

40.When the economy overheats, the government sometimes cools it down with higher taxes, spending reductions, and less money. Which of the following indicates the appropriate change in the U.S. economy after government intervention?   

A. Aggregate demand shifts to the left

B. Aggregate demand shifts to the right

C. The economy moves up along the aggregate demand curve

D. The economy moves down along the aggregate demand curve