Chapter_12_Review_Questions

Chapter_12_Review_Questions - 1) Chinese toy exports were...

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Unformatted text preview: 1) Chinese toy exports were hurt in 2007 as a result of lead paint fears. How would this decrease in exports have affected China's aggregate demand curve? A) Aggregate demand would have shifted to the left. B) Aggregate demand would have shifted to the right. C) Aggregate demand would not have shifted, but there would have been a movement up the aggregate demand curve. D) Aggregate demand would not have shifted, but there would have been a movement down the aggregate demand curve. 9‘1 :40- ,w \{r __ 2) Suppose the US. GDP growth rate is slower relative to other countries' GDP growth rates. This will A) move the economy up along a stationary aggregate demand curve. B) shift the aggregate demand curve to the left. C) move the economy down along a stationary aggregate demand curve. B) shift the aggregate demand curve to the right. P Y 3) Suppose a developing country receives more machinery and capital equipment as foreign entrepreneurs increase the amount of investrnent'in the economy. "As a result, A) the economy will move down along the long run aggregate supply curve. B) the long run aggregate supply curve will shift to the left. C) the economy will move up along the long run aggregate supply curve. D) the long run aggregate supply curve will shift to the right. 1) 2) 3) 4) Which of the following is not a reason why the wages of workers and the prices of inputs rise more slowly than the prices of final goods and services? A) Menu costs make some prices sticky. B) Contracts make prices and wages "sticky." (1) Firms are often slow to adjust wages. D) Unions are successqu in pushing up wages. 5) If workers leave a country to seek out better opportunities in another country, then this will A) move the original economy down along a stationary short run aggregate supply curve. B) move the original economy up along a stationary short run aggregate supply curve. C) shift the short run aggregate supply curve of the original country to the left. D) shift the short run aggregate supply curve of the original country to the ' ht. g mg t”) r . at a r 6) Workers and firms both expect that prices will be 3% higher next year than they are this year. As a result, A) aggregate demand will increase by 3% B) short run aggregate supply will shift to the left as wages increase. (L) werkers will be willing to take tower wages next year. D) the purchasing power of wages will rise-if wages increase by 3%. 4) 5) 6) 7) There has been an increase in investment. As a result, real GDP will in 7) the short run, and in the long run. A) increase; decrease to its initial value B) decrease; decrease further p Lflflrfi C) increase; increases further D) decrease; increase to its initial level _ Yaw Kr, 8) An increase in aggregate demand in the economy will have What effect on 8) macroeconomic equilibrium in the long run? A) The price level will rise, and the level of GDP will fall. B) The price level Will fall, and the level of GDP will rise. (2) The price level will rise, and the level of GDP will be unaffected. D) The price level will fall, and the level of GDP will fall. W)in «seas / ' ‘ _Wflm.mmmwwmeflhetwnWWEMM'WA‘ k r “(so 9) After an unexpected increase in the price of oil, the long—run adjustment 9) the price level and the unemployment rate as they return to their original levels. A) decreases; decreases B) increases; increases C) decreases; increases D) increases; decreases its; ...
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Chapter_12_Review_Questions - 1) Chinese toy exports were...

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