Economics Practice Exam - Economics Practice Exam Ch. 10-12...

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Economics Practice Exam Ch. 10-12 (MacroEconomics) All HIGHLIGHED Answers are INCORRECT!!!! So basically pick from 3 choices! 3. In classical model, an increase in the unemployment rate A. will persist when the reduction in output is caused by a reduction in aggregate demand. B. will likely be temporary. C. will result in an increase in the price level if the reduction in outputs is caused by a change in aggregate demand. D. is a signal of demand-pull inflation. 4. The real-balance effect refers to A. the economy’s ability to balance recession and expansion. B. the economy’s response to interest rate changes. C. the change in the value of cash balances due to price level changes. D. the change in net exports. 5. In the classical model, desired saving A. is inversely related to real income. B. exceeds investment. C. is equal to desired investment. D. is less than desired investment. 6. Leakages in the circular flow model are A. caused by people not acting rational. B. caused by people deciding to save. C. Reflected in the vertical long-run aggregate supply curve. D. possible when unemployment exists. 8. According to the circular flow of income and output, saving causes A. consumption expenditures and total output to fall. B. consumption expenditures to fall short of total output. C. investment spending to fall. D. total output to fall. 9. The long-run aggregate supply will increase when
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Economics Practice Exam - Economics Practice Exam Ch. 10-12...

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