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ECN 211: Macroeconomic Principles (2024 Fall C)

Principles of Accounting II

Business Law

Introduction to Statistics

Strategic and Enterprenural Thinking

When an increase in net exports increases the income of domestic consumers, and those consumers spend some of that increase in income on additional consumer goods, we have seen a demonstration of _______.

a. the multiplier effect

b. the investment accelerator

c. the export effect

d. supply-side economics

e. none of the answer choices

a. the multiplier effect...

Posted by Cleveland on September 17, 2024

Suppose the government increases its purchases by $25 billion. If the multiplier effect exceeds the crowding-out effect, then _______.

a. the aggregate-supply curve shifts to the right by more than $25 billion

b. the aggregate-demand curve shifts to the left by more than $25 billion

c. the aggregate-supply curve shifts to the left by more than $25 billion

d. the aggregate-demand curve shifts to the right by more than $25 billion

d. the aggregate-demand curve shifts to the right by more than $25 billion...

Posted by Cleveland on September 17, 2024

Which of the following statements regarding taxes is correct?

a. A permanent change in taxes has a greater effect on aggregate demand than a temporary change in taxes.

b. An increase in taxes shifts the aggregate-demand curve to the right.

c. Most economists believe that, in the short run, the greatest impact of a change in taxes is on aggregate supply, not aggregate demand.

d. A decrease in taxes shifts the aggregate-supply curve to the left.

a. A permanent change in taxes has a greater effect on aggregate demand than a temporary change in taxes....

Posted by Cleveland on September 17, 2024

When an increase in government purchases raises incomes, shifts money demand to the right, raises the interest rate, and lowers investment, we have seen a demonstration of _______.

a. the investment accelerator

b. supply-side economics

When an increase in government purchases raises incomes, shifts money demand to the right, raises the interest rate, and lowers investment, we have seen a demonstration of _______.

a. the investment accelerator

b. supply-side economics

c. the crowding-out effect

d. the aggregate-demand effect

e. the liquidity trap

c. the crowding-out effect...

Posted by Cleveland on September 17, 2024

Suppose that irrational exuberance has generated an increase in investment spending so that the current level of output exceeds the long-run natural level. If policymakers choose to engage in activist stabilization policy, they should _______.

a. decrease taxes, which shifts aggregate demand to the left

b. decrease government spending, which shifts aggregate demand to the right

c. decrease government spending, which shifts aggregate demand to the left

d. decrease taxes, which shifts aggregate demand to the right

c. decrease government spending, which shifts aggregate demand to the left...

Posted by Cleveland on September 17, 2024

An increase in the marginal propensity to consume (MPC) _______.

a. raises the value of the multiplier

b. rarely occurs because the MPC is set by legislation

c. lowers the value of the multiplier

d. has no impact on the value of the multiplier

a. raises the value of the multiplier...

Posted by Cleveland on September 17, 2024

If the marginal propensity to consume (MPC) is 0.80, the value of the multiplier is _______.

a. 0.80

b. 4

c. 5

d. 8

e. none of the answer choices

c. 5...

Posted by Cleveland on September 17, 2024

The initial impact of an increase in government spending is to shift _______.

a. aggregate demand to the right

b. short-run aggregate supply to the right

c. short-run aggregate supply to the left

d. aggregate demand to the left

a. aggregate demand to the right...

Posted by Cleveland on September 17, 2024

Suppose a pandemic causes a reduction in consumer spending. If the Federal Reserve chooses to engage in activist stabilization policy, it should _______.

a. increase government spending and decrease taxes

b. decrease the money supply and increase interest rates

c. increase the money supply and decrease interest rates

d. decrease government spending and increase taxes

c. increase the money supply and decrease interest rates...

Posted by Cleveland on September 17, 2024

The long-run effect of an increase in the money supply is to _______.

a. decrease the price level

b. increase the price level

c. decrease the interest rate

d. increase the interest rate

b. increase the price level...

Posted by Cleveland on September 17, 2024

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