1. Adjustments in __________ take the economy from the short-run equilibrium to the long-run equilibrium. A.imports and exports B.interest rates C.wages and prices D.the multiplier
2. When the price level increases, the real interest rate __________. A.is not affected B.falls C.rises D.will rise or fall depending on demand
3 When the real GDP increases, disposable income and consumption expenditure __________. A.do not change B.become inverted C.decrease D.increase
4 Expenditures such as investment, government expenditure on goods and services, and exports __________ on real GDP. A.do not depend B.depend greatly C.remain constant based D.vary in their individual dependence
5 __________ occurs when aggregate planned expenditure equals real GDP. A.Price-fixing B.Stable economic leveling C.Unplanned inventory change D.Equilibrium expenditure
6 All other things remaining the same, the lower the price level, the __________ the quantity of real GDP demanded. A.smaller B.greater C.more constant D.less constant
7 What represents the relationship between the quantity of real GDP demanded and the price level when all other influences on expenditure plans remain the same? A.aggregate demand B.aggregate supply C.the money wage rate D.the money price index
8 What is the total amount of final goods and service that firms in a country plan to produce, depending on the labor, capital, technology, natural resources, and entrepreneurial talent in the market? A.the supply-demand model B.the quantity of real gross domestic product (GDP. supplied C.the quantity of potential GDP D.the quantity of real GDP demanded
9 The __________ curve summarizes the relationship between aggregate planned expenditure and the real GDP. A.AES B.AE C.AD D.APE
10 Why does the quantity of real GDP supplied change when the price level changes? A.movement along the AS curve brings a change in the price of resources B.movement along the AS curve brings a change in the potential GDP C.movement along the AS curve brings a change in the GDP price index D.movement along the AS curve brings a change in the real wage rate
11 How does change in the expected inflation rate affect the short-run tradeoff between inflation and unemployment? A.Immediately, because the money wage rate is sensitive to change in the expected inflation rate. B.Immediately, because unemployment and job production respond quickly to change in the expected inflation rate. C.Gradually, because the money wage rate responds only gradually to change in the expected inflation rate. D.Gradually, because the natural unemployment rate rarely changes.
12 What is the forecast for inflation that results from the analysis of all the relevant data and economic science? A.rational expectation B.surprise inflation expectation C.credible announced inflation expectation D.statistical model of expectation
