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ECON 2305 HW #11

The​ ________ shows the relationship between the price level and quantity of real GDP demanded. aggregate demand curve
Because of the slope of the aggregate demand curve, we can say that a decrease in the price level leads to a higher level of real GDP demanded.
An increase in the price level results in​ a(n) ___________ in the quantity of real GDP demanded because​ ___________. ​decrease; a higher price level reduces​ consumption, investment, and net exports.
An increase in the price level will move the economy up along a stationary aggregate demand curve.
Suppose the U.S. GDP growth rate is faster relative to other​ countries' GDP growth rates. U.S. imports will therefore increase faster than U.S.​ exports, and this will shift the aggregate demand curve to the left.
If aggregate demand just​ increased, which of the following may have caused the​ increase? an increase in government purchases
Refer to the figure to the right. Ceteris paribus​, an increase in the price level would be represented by a movement from point B to point A
Refer to the figure to the right. Ceteris​ paribus, an increase in interest rates would be represented by a movement from AD2 to AD1.
Refer to the figure to the right. Ceteris​ paribus, an increase in personal income taxes would be represented by a movement from AD2 to AD1.
Refer to the figure to the right. Ceteris​ paribus, a decrease in​ firms' expectations of the future profitability of investment spending would be represented by a movement from AD2 to AD1
Refer to the figure. Ceteris​ paribus, a decrease in the growth rate of domestic GDP relative to the growth rate of foreign GDP result in U.S. exports increasing faster than U.S. imports. This would be represented by a change from AD1 to AD2.
According to the​ "wealth effect," when the​ ________ falls, the​ ________ rises. price​ level; the real value of household wealth
Which of the following best describes the​ "interest rate​ effect"? An increase in the price level raises the interest rate and chokes off investment and consumption spending.
Which of the following will shift the aggregate demand curve to the​ left, ceteris paribus​? an increase in interest rates
The level of aggregate supply in the long run is not affected by changes in the price level.
Potential GDP refers to the level of Real GDP in the long run.
If stricter immigration laws are imposed and many foreign workers in the United States are forced to go back to their home​ countries, the​ long-run aggregate supply curve will shift to the left.
​Full-employment GDP is also known as potential GDP
On the​ long-run aggregate supply​ curve, a decrease in the price level has no effect on the aggregate quantity of GDP supplied.
The​ long-run aggregate supply curve will shift to the right if the economy experiences technological change.
Created by: aardogge
 

 



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