3.03 - Question 1 (Worth 3 points) If consumer wealth...

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Question 1 (Worth 3 points) If consumer wealth decreases as the stock market plunges, then there is a movement down the AD curve as price level decreased. AD shifts right and price level would decrease. AD shifts right and price level would increase. AD shifts left and the price level would increase. Points earned on this question : 3 Question 2 (Worth 3 points) Tax cuts increase consumer incentive to save. Which determinant(s) of aggregate demand cause the change? Price Consumer spending only Investment spending and consumer spending Productivity and consumer spending Points earned on this question : 0 Question 3 (Worth 3 points) Consumers fear a recession is coming. Aggregate demand will
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increase. decrease. remain the same. Points earned on this question : 3 Question 4 (Worth 3 points) Imports of foreign automobiles increase 10%. Which determinant of aggregate demand causes the change? Price Consumer spending Investment spending Government spending Net exports Productivity Resource cost Government intervention (taxes, subsidies, or regulations) Points earned on this question : 0 Question 5 (Worth 3 points) The wealth effect states that
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as price levels fall, interest rates decrease and real GDP increases. as prices rise in an economy, consumers tend to buy cheaper foreign products and fewer domestic products. if price levels drop, the value of money is higher, and consumers will spend
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This note was uploaded on 05/15/2011 for the course ECON 101 taught by Professor Dannicatambay during the Fall '08 term at UPenn.

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3.03 - Question 1 (Worth 3 points) If consumer wealth...

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