21.00

Points Earned:3.0/3.0Correct Answer(s):21, 21.0, 21.0021.Consumption is positively related to stock market wealth but negatively related to taxes and tax rates.A) TrueB) FalsePoints Earned:1.0/1.

0Correct Answer(s):True22.If aggregate expenditures rise unexpectedly, then inventories will also rise unexpectedly.Points Earned:1.0/1.0Correct Answer(s):False23.Services are the most interest rate sensitive component of consumption.Points Earned:1.0/1.0Correct Answer(s):False24.Investment is the most cyclical component of aggregate expenditures.Points Earned:1.0/1.0Correct Answer(s):True25.The 'job-loss' recovery occurred following the 2001 recession.

A) TrueB) FalsePoints Earned:1.0/1.0Correct Answer(s):True26.Negative real interest rates imply that if you save today, you can purchase a smaller basket of goods and services in the future, relative to the basket you could have consumed today.Points Earned:1.0/1.0Correct Answer(s):True27.The higher the marginal propensity to consume the more powerful tax policy is to influencing consumption.Points Earned:1.0/1.0Correct Answer(s):True28.According to the results of the estimated consumption function, consumption is more sensitive to changes in stock market wealth relative to changes in real estate wealth.Points Earned:1.0/1.

0Correct Answer(s):False29.The sensitivity parameter in the consumption function that measures how sensitive consumption is to changes in consumer confidence is referred to as the marginal propensity to consume.A) TrueB) FalsePoints Earned:0.0/1.0Correct Answer(s):False30.In a consumption function with income (Y) on the horizontal axis and consumption (C) on thevertical axis, a fall in the real rate of interest (all else constant) will cause a shift upward of the consumption function.Points Earned:1.0/1.0Correct Answer(s):True31.In a consumption function with income (Y) on the horizontal axis and consumption (C) on thevertical axis, a rise in the price level (all else constant) will cause a shift upward of the consumption function.Points Earned:1.0/1.0Correct False

Answer(s):32.A fall in tao, the effective tax rate on capital will result in the investment demand function shifting to the right.Points Earned:1.0/1.0Correct Answer(s):True

#### You've reached the end of your free preview.

Want to read all 22 pages?

- Fall '10
- staff
- Macroeconomics, Inflation, Supply And Demand