Exam 23: Aggregate Demand and Aggregate Supply

A) taxes rise and shifts left if stock prices rise.
B) taxes rise and shifts left if stock prices fall.
C) taxes fall and shifts left if stock prices rise.
D) taxes fall and shifts left is stock prices fall.

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A) an increase in the money supply
B) an increase in net exports due to something other than a change in domestic prices
C) an investment tax credit
D) All of the above are correct.

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A) the capital stock increases.
B) there is a natural disaster.
C) the government removes some environmental regulations that limit production methods.
D) None of the above is correct.

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A) increases,so aggregate demand shifts right.
B) increases,so aggregate supply shifts right.
C) decreases,so aggregate demand shifts left.
D) decreases,so aggregate supply shifts left.

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A) quantity of labor and other inputs that firms want to buy at each price level.
B) quantity of labor and other inputs that firms want to buy at each inflation rate.
C) quantity of domestically produced goods and services that households want to buy at each price level.
D) quantity of domestically produced goods and services that households,firms,the government,and customers abroad want to buy at each price level.

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A) The expected price level falls.Bargains are struck for higher wages.
B) The expected price level falls.Bargains are struck for lower wages.
C) The expected price level rises.Bargains are struck for higher wages.
D) The expected price level rises.Bargains are struck for lower wages.

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A) can only lead to recessions.
B) have not contributed much to output fluctuations in the United States.
C) change the economy principally by changing aggregate demand.
D) created both inflation and recession in the United States in the 1970s.

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A) the exchange rate falls,so net exports fall.
B) the exchange rate falls,so net exports rise.
C) the exchange rate rises,so net exports fall.
D) the exchange rate rises,so net exports rise.

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A) interest rates fall and so aggregate demand shifts right.
B) interest rates fall and so aggregate demand shifts left.
C) interest rates rise and so aggregate demand shifts right.
D) interest rates rise and so aggregate demand shifts left.

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A) rise,so firms increase investment.
B) rise,so firms decrease investment.
C) fall,so firms increase investment.
D) fall,so firms decrease investment.

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A) net exports rise and shifts left if the money supply increases.
B) net exports rise and shifts right if the money supply increases.
C) net exports fall and shifts left if the money supply increases.
D) net exports fall and shifts right if the money supply increases.

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A) make it rise which by itself would increase U.S.aggregate demand.
B) make it rise which by itself would decrease U.S.aggregate demand.
C) make it fall which by itself would increase U.S.aggregate demand.
D) make it fall which by itself would decrease U.S.aggregate demand.

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A) real wealth falls.
B) the interest rate rises.
C) the dollar depreciates.
D) None of the above is correct.

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A) short-run aggregate supply shifts right
B) short-run aggregate supply shifts left
C) aggregate demand shifts right
D) aggregate demand shifts left

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A) firms will increase production.In the long run increased price expectations shift the short-run aggregate supply curve to the right.
B) firms will increase production.In the long run increased price expectations shift the short-run aggregate supply curve to the left.
C) firms will decrease production.In the long run increased price expectations shift the short-run aggregate supply curve to the right.
D) firms will decrease production.In the long run increased price expectations shift the short-run aggregate supply curve to the left.

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