How does an increase in government spending affect the aggregate expenditure

How does an increase in government spending affect

This preview shows page 4 - 5 out of 5 pages.

200) How does an increase in government spending affect the aggregate expenditure line? A) It shifts the aggregate expenditure line downward.B) It decreases the slope of the aggregate expenditure line.C) It increases the slope of the aggregate expenditure line.D) It shifts the aggregate expenditure line upward.Answer: D200)Page Ref: 791-792/409-410Learning Outcome: Macro-8: Investigate the relationship between income and expenditures. 201) ________ is equal to consumption spending plus planned investment spending plus governmentpurchases plus net exports. 201)Page Ref: 794/412Learning Outcome: Macro-2: Explain the relationship between expenditure and income.TRUE/FALSE. WriteʹTʹif the statement is true andʹFʹif the statement is false.202) When net exports equal zero, the economy is in macroeconomic equilibrium.202)Answer:TrueFalsePage Ref: 790/408Learning Outcome: Macro-3: Identify and interpret key macroeconomic measures.203) Macroeconomic equilibrium can occur at any point on the 45-degree line.203)Answer:TrueFalsePage Ref: 790/408Learning Outcome: Macro-3: Identify and interpret key macroeconomic measures. 42
Background image
204) For all points below the 45-degree line, planned aggregate expenditure will be less than GDP.204)Answer:TrueFalsePage Ref: 790/408Learning Outcome: Macro-2: Explain the relationship between expenditure and income.205) If planned aggregate expenditure equals GDP, the economy is in macroeconomic equilibrium.205)Answer:TrueFalsePage Ref: 790/408Learning Outcome: Macro-2: Explain the relationship between expenditure and income.206) For all points above the 45-degree line, planned aggregate expenditure will be less than GDP.206)Answer:TrueFalsePage Ref: 790/408Learning Outcome: Macro-2: Explain the relationship between expenditure and income.207) If planned aggregate expenditure is less than real GDP, some firms will experience unplannedincreases in inventories.
Background image

You've reached the end of your free preview.

Want to read all 5 pages?

  • Summer '19
  • Economics, Harshad number, Page Ref, 191

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

Stuck? We have tutors online 24/7 who can help you get unstuck.
A+ icon
Ask Expert Tutors You can ask You can ask You can ask (will expire )
Answers in as fast as 15 minutes