AP Macro- National Income and Price Determination

Question 1

Which of the following causes a positive demand shock?

Accepted Answer

An increase in wealth.

Question 2

The Consumer Confidence Index is used to measure which of the following?

Accepted Answer

Consumer expectations.

Question 3

Actual investment spending in any period is equal to:

Accepted Answer

planned investment spending + unplanned inventory investment

Question 4

Decrease in which of the following will cause short-run aggregate supply curve to shift left?

Accepted Answer

Productivity.

Question 5

Decreases in the stock market decrease aggregate demand by decreasing which of the following?

Accepted Answer

Consumer wealth.

Question 6

The marginal propensity to consume:

Accepted Answer

represents the portion of consumers' disposable income spent

Question 7

The presence of taxes has what effect on the multiplier? They:

Accepted Answer

Decrease it.

Question 8

The level of planned investment spending is negatively related to the:

Accepted Answer

Interest rate.

Question 9

A lump-sum tax is:

Accepted Answer

independent of income.

Question 10

Which of the following is NOT an automatic stabilizer?

Accepted Answer

Monetary policy.

Question 11

An income taxed rebate is an example of:

Accepted Answer

an expansionary fiscal policy.

Question 12

Which of the following is a government transfer program?

Accepted Answer

All of the above.

Question 13

Which of the following is a fiscal policy that is appropriate to combat inflation?

Accepted Answer

Decreasing government spending.

Question 14

Which of the following will shift the short- run aggregate supply curve? A change in:

Accepted Answer

all of the above.

Question 15

Changes in which of the following leads to a shift of the aggregate consumption function?

Accepted Answer

Both expected future disposable income and aggregate wealth.

Question 16

The horizontal intercept of the long-run aggregate supply curve is:

Accepted Answer

at potential output.

Question 17

The slope of a family's consumption is equal to:

Accepted Answer

Marginal propensity to consume.

Question 18

Which of the following is an example of expansionary fiscal policy?

Accepted Answer

Increasing government spending.

Question 19

During stagflation, what happens to the aggregate price level and real GDP?

Accepted Answer

Aggregate price level increases and real GDP decreases.

Question 20

Which of the following causes a negative supply shock?

Accepted Answer

An increase in oil prices.

Question 21

Which of the following will shift the aggregate demand curve to the right?

Accepted Answer

A decrease in the existing stock of a capital.

Question 22

Because changes in aggregate price level have no effect on aggregate output in the long run:

Accepted Answer

Long-run aggregate supply curve is vertical.

Question 23

Which of the following government policies will shift the aggregate demand curve to the left?

Accepted Answer

A decrease in the quantity of money.

AP Macro- National Income and Price Determination

Questions 23

AP Macro- National Income and Price Determination

Questions 23