7. Aggregate supply (AS) denotes the relationship between the __________________ that firms choose to produce and sell and the _________________, holding the price of inputs fixed.

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 8. When prices of outputs in an economy become sufficiently high causing production to exceed potential GDP, the resulting:

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9. When the aggregate demand curves slope downwards because the price of a good increases, people will 

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10. In macroeconomics, _____________________ denotes the relationship between the total quantity of goods and services and the price level for output.

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11. The following table shows the aggregate supply and demand data for a country.  

What is the equilibrium output?

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12.

 Refer to the graph above. A government creating economic policy in these circumstances should be most concerned about: 

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13. The Keynesian economic framework is based on an assumption that: 

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14. The onset of a trade deficit is most likely supported by a country’s: 

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15.  When an economy is experiencing higher real interest rates, business firms will most likely be discouraged from investing in:

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16. In macroeconomics, what name is given to the costs of changing prices that businesses must consider?

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17. If a Keynesian expenditure-output model shows that aggregate demand for both goods and labor has shifted to the left to D1, while wages remained at w0 and prices remained at P0, what will be the result?

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18. In macroeconomics, a _________________ is used to show the relationship between output and the input price level.

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19. ___________________ will not cause a shift of the AS curve in a Keynesian framework.

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 20.  If markets throughout the global economy all have flexible and continually adjusting prices, then:

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21. According to the Keynesian framework, ____________________________ will not help reduce inflation, but may help a country get out of a recession.

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22. Consumption, investment, government spending, exports, and imports are:

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23.  The equilibrium quantity of labor and the equilibrium wage level decrease when:

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24. Suppose that out of the original 100 increase in government spending, 33 will be recycled back into purchases of domestically produced goods and services in the second round and 10.89 is spent in the third round. Following this multiplier effect, what value would be recycled in the fourth round of this cycle? 

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25.  The chart below gives the data necessary to make a Keynesian cross diagram. Assume that the tax rate is 0.4 of national income, the MPC out of after-tax income is 0.9, investment is 58, government spending is 60, exports are 40, and imports are 0.1 of after-tax income. 

What does consumption equal when income equals 600?

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