final fall04 - SECTION_ ECON 162B-90,91 Fall 2004 NAME_...

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NAME______________________________ ECON 162B-90,91 Kenny Christianson Fall 2004 December 15, 2004 FINAL EXAMINATION (A) PART I MULTIPLE CHOICE (30 points) Choose the single best answer. 1. Which of the following will lead to an increase in aggregate demand in the neo- Keynesian model? a. a decrease in consumption spending. b. an increase in income taxes. c. an increase in interest rates. d. a decrease in the money supply. e. a decrease in the value of the dollar. 2. Which of the following is not a determinant of aggregate supply? a. resource prices b. technology c. business expectations. d. consumer confidence. e. business taxes and regulations. 3. Why is the aggregate demand curve downward-sloping? a. An increase in the price level increases consumption spending. b. An increase in the price level increases investment spending. c. An increase in the price level increases net export spending. d. all of the above. e. none of the above. 4. A progressive income tax system a. can act as an automatic stabilizer for the economy. b. means that average tax rates increase as income increases. c. will tend to reduce consumption spending in the economy compared to a regressive tax system that raises the same amount of revenue. . d. all of the above. e. both a) and b). 5. Assume a simple fixed-price Keynesian model where the MPC is 0.8. Which of the following will lead to the largest increase in equilibrium GDP? a. A tax cut of $100. b. A tax increase of $125. c.
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This note was uploaded on 11/19/2010 for the course ECON 162 taught by Professor Christianson during the Spring '05 term at Binghamton University.

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final fall04 - SECTION_ ECON 162B-90,91 Fall 2004 NAME_...

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