Quiz - Chapters 27, 28 and 30

# Quiz Chapters 27, - Points Awarded 120.00 Points Missed 0.00 Percentage 100 1 Actual aggregate expenditure is A always equal to real GDP B only

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Points Awarded 120.00 Points Missed 0.00 Percentage 100% 1. Actual aggregate expenditure is A) always equal to real GDP. B) only equal to real GDP at the equilibrium level of aggregate planned expenditure. C) never greater than real GDP but can be less than real GDP. D) never less than real GDP but can be greater than real GDP. Points Earned: 1.0/1.0 Correct Answer(s): A 2. The multiplier is the ratio of the A) change in real GDP to the change in autonomous expenditures. B) equilibrium level of real GDP to the change in induced expenditures. C) change in induced expenditures to the change in autonomous expenditures. D) change in autonomous expenditures to the change in real GDP. Points Earned: 1.0/1.0 Correct Answer(s): A

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3. If the slope of the AE curve increases, the multiplier A) decreases. B) increases. C) stays the same. D) can either increase or decrease depending on what happens to the MPC. Points Earned: 1.0/1.0 Correct Answer(s): B 4. In the above figure, the shift from AE0 to AE1 might have been caused by A) an increase in government expenditures. B) an increase in the real interest rate. C) an increase in the price level. D) All of the above answers are correct. Points Earned: 1.0/1.0 Correct Answer(s): A
5. The multiplier measures the A) horizontal shift in the aggregate demand curve from an increase in autonomous spending. B) vertical shift in the aggregate demand curve from an increase in autonomous spending. C) horizontal difference between two points on the same aggregate demand curve. D) vertical difference between two points on the same aggregate demand curve. Points Earned: 1.0/1.0 Correct Answer(s): A 6. What is the largest source of revenue for the federal government? A) Social Security taxes B) corporate income taxes C) personal income taxes D) sales tax Points Earned: 1.0/1.0 Correct Answer(s): C 7. A budget deficit is the difference between A) what U.S. consumers buy and U.S. producers produce. B) foreign holdings of U.S. assets and U.S. holdings of foreign assets. C) government tax revenues and government outlays.

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D) U.S. imports and U.S. exports. Points Earned: 1.0/1.0 Correct Answer(s): C 8. As a percentage of GDP, from 1980 to 2005, federal government tax revenue A) increased until 1995, after which it fell. B) was higher in 2000 than in 2006. C) decreased steadily throughout the period. D) reached its peak in 2006. Points Earned: 1.0/1.0 Correct Answer(s): B 9. The supply side effects of a change in taxes on labor income means that ________ in taxes on labor income shift the ________. A) an increase; labor supply curve rightward B) an increase; labor supply curve leftward C) a decrease; labor demand curve rightward D) a decrease; labor demand curve leftward Points Earned: 1.0/1.0
Correct Answer(s): B 10. Since 1993, the amount of U.S. foreign borrowing A) has not changed. B) generally increased.

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## This note was uploaded on 09/13/2011 for the course ECON 206 taught by Professor Parkin during the Spring '11 term at Buena Vista.

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Quiz Chapters 27, - Points Awarded 120.00 Points Missed 0.00 Percentage 100 1 Actual aggregate expenditure is A always equal to real GDP B only

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