Wednesday, 22 April 2020

Holding everything else constant, an increase in the growth rate of the money supply will cause the AD curve to not shift at all

1-Holding everything else constant, an increase in the growth rate of the money supply will cause the AD curve to not shift at all.
shift outward.
shift randomly.
shift inward.
2-In the AD-AS model, which curve would be irrelevant if prices and wages were perfectly flexible?
A. Long-Run Aggregate Supply
B. Long-Run Aggregate Demand
C. Short-Run Aggregate Supply
D. Aggregate Demand
3-An increase in the expected inflation rate will cause the LRAS curve to:
A. do nothing.
B. shift right.
C. flatten out.
D. shift left.
4-When consumers suddenly become more pessimistic about the economy, the stock shifts the:
A. LRAS curve outward, reducing the real growth rate in the short run.
B. AD curve inward, reducing the real growth rate in the short run.
C. AD curve outward, reducing the real growth rate in the short run.
D. LRAS curve inward, reducing the real growth rate in the short run.
5-Which of the following would cause the AD curve to shift to the left?
A. lower growth rate of output
B. decreased government purchases
C. higher government budget deficits
D. lower taxes
6-A temporary decrease in consumer spending causes:
A. a decrease in the economy's long-run potential growth rate
B. a decrease in velocity growth
C. an upward shift of the SRAS curve.
D. a decrease in money growth
7-Which of the following best describes the conditions of the Great Depression?
A. Real GDP growth was negative while inflation was very high.
B. Both real GDP growth and inflation were historically high.
C. Real GDP was high while inflation was negative.
D. Both real GDP growth and inflation were negative.
8- Menu costs are the costs associated with changing:
A. jobs.
B. wages.
C. prices.
D. expected inflation.
9-A temporary positive shock to spending growth will lead to an increase in:
A. output and inflation in the short run, but no change in either in the long run.
B. output in both the short and long run.
C. both inflation and output in the short run, but only output in the long run.
D. both inflation and output in the short run, but only inflation in the long run.
10- Which of the following describes the process through which a major decline in the stock market leads to a change in Aggregate Demand?
A. Banking panics lead to a removal of deposit insurance and a negative AD shock.
B. A stock market bubble bursts, and this leads to a negative supply shock.
C. Reductions in consumer wealth produce a negative AD shock.
D. Increase in net exports produce a negative AD shock.

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