QZ5 studyguide

12 regular interest payments made to bondholders are

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Unformatted text preview: rgely by rapidly rising government budget deficits. 12. Regular interest payments made to bondholders are called _____ payments. a) dividend b) diversification c) reserve d) principal e) coupon 13. In the Keynesian model, a $1 billion decrease in autonomous consumption leads to ______ in short-run equilibrium output. a) a greater than $1 billion increase d) a $1billion increase b) more than a $1 billion decrease e) no change c) a $1 billion decrease Page 4 of 11 ECO 2013 – Section 0008 – QUIZ IV – Version 1 O. Mikhail – http://www.bus.ucf.edu/omikhail Use the following to answer question 14: PAE Y = PAE Y* PAE = 600 + .5Y PAE = 400 + .5Y PAE = 200 + .5Y 600 400 200 45 400 800 1,200 Output Y Y* 14. Based on the figure, the income expenditure multiplier equals: a) 2. b) 400. c) 0.5. d) 5. e) 200. 15. At each value of the domestic interest rate, decreases in the riskiness of domestic assets _____ capital inflows, _____ capital outflows, and _____ net capital inflows. a) decrease; decrease; decrease d) increase; increase; decrease b) increase; decrease; increase e) increase; increase; increase c) decrease; increase; decrease 16. Short-term economic fluctuations are _____ in length and severity and ____ to predict. a) regular; easy d) irregular; easy b) constant; easy e) regular; difficult c) irregular; difficult 17. In the long run, total spending only influences: a) productive capacity. d) potential output. b) infla...
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