New AP MACRO UNIT 3 EXAM REVIEW

What caused the shift below in the LR?

What is the formula for the spending multiplier?

Aggregate demand is downward sloping because

Where is the economy if the level of output Y1 is below the full employment level of output Yf ?

Disposable Income equals

The Long-Run Aggregate Supply Curve

If people are currently spending 80% of each new dollar, what will be the spending and tax multipliers in the economy?

Aggregate demand is:

Marginal Propensity to Save

AD will shift to the right if

Discretionary Fiscal Policy involves passing a new law to change all of the following EXCEPT

If there is an increase in investment spending in the economy of 10B with the MPC being .8 then total output will:

If the economy is in a negative output gap and the government decides to do a expansionary policy to fix it then:

On which of these is the current unemployment rate in the economy equal to the natural rate of unemployment?

A decrease in taxes increases AD because

This series of shifts could happen if?

If income in the economy increases by 100B and Consumption increases by 75 billion then

Which of these changes in discretionary Fiscal Policy is contractionary?

Short Run Aggregate Supply is upward sloping because of

If the economy has a recessionary gap of 60B and the MPS is .2 then to fix it the government must

An automatic stabilizer that would operate in an inflationary gap would be

A decrease in short-run aggregate supply will have what effect on price level and output?

Stagflation is

All of the following we know for sure about the SR equilibrium of the economy below EXCEPT

If the economy is in a recessionary gap, and there is no government policy to fix it then in the long-run: