TRUE OR FALSE Government spending and aggregate demand are positively related. if government spending increases, aggregate...
TRUE OR FALSE
Government spending and aggregate demand are positively related. if government spending increases, aggregate demand increases as well
Homework Answers
True
Reason: AD = C+I+G+X-M
Where, G stands for government expenditure
G is directly and positively related to AD
As G increases, AD increases. This is because Increase in government expenditure increases purchase power of consumers and thus increases their demand for goods and services
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TRUE OR FALSE
Government spending and aggregate demand are positively related.
if government spending increases, aggregate...
Suppose government spending increases. True or False: The effect on aggregate demand would be larger if...
Suppose government spending increases.
True or False: The effect on aggregate demand would be larger if the Federal Reserve held the money supply constant in response than if the Fed were committed to maintaining a fixed interest rate.
36. True or False: In order to accomplish the same change in aggregate demand, the government...
36. True or False: In order to accomplish the same change in aggregate demand, the government will always need to increase spending more than a change a tax. a. True b. False 37. When the government increases taxes and government spending by the same amount a. The Ricardo-Barro effect predicts less savings and the government is still b. The government must increase the deficit to finance the spending and the c. There is no change in the government budget deficit...
Suppose government spending increases. Would the effect on aggregate demand be larger if the Federal Reserve...
Suppose government spending increases. Would the effect on aggregate demand be larger if the Federal Reserve held the money supply constant in response or if the Fed were committed to maintaining a fixed interest rate? Explain.
True or False: The reasons for the downward slope of an aggregate demand curve include the real b...
True or False: The reasons for the downward slope of an aggregate demand curve include the real balances effect, the interest-rate effect, and the net exports effect. True O False Although the AD and market demand curves are both downward sloping, the two concepts are different because the AD curve deals with prices and a ー, while the market demand curve deals with prices and a For each scenario in the following table, indicate whether the aggregate demand curve will...
The following list contains items that are related to aggregate demand and/or aggregate supply. Government Spending...
The following list contains items that are related to aggregate demand and/or aggregate supply. Government Spending Consumer Expectations Degree of Excess capacity Personal Income Tax Rates Productivity National Income Abroad Business Taxes Domestic Resource Availability Price of Imported Products Profit Expectations on Investments Refer to the above list. Changes in which of the above two factors would most likely cause a change in aggregate supply? Multiple Choice 8 and 9 3 and 10 5 and 7 1 and 5
the government cuts tases or inereases government spending 20) ) the aggregate demand curve shifts to...
the government cuts tases or inereases government spending 20) ) the aggregate demand curve shifts to the right. tne long-run aggregate supply curve shifts to the left. C) the 20) When aggregate demand curve shifts to the left. the short-run aggregate supply curve shifts to the left. t spending without an accompanying increase 21) An increase in govenment spending n taxes demand A) does not increase aggregate B) would effectively eliminate an inflationary gap. Q mquires additional govemment borrowing spending...
The aggregate supply curve will shift to the right when: A: government spending increases B: the...
The aggregate supply curve will shift to the right when: A: government spending increases B: the capital stock of the economy decreases C: the nominal wage rate increases D: energy prices fall. I am thinking the answer is D--is this correct? B and C are leftward shifts, and I believe A affects Aggregate Demand rather than Aggregate Supply.
The largest component of aggregate spending in the Canadian economy is government spending on goods and...
The largest component of aggregate spending in the Canadian economy is government spending on goods and services (G). True False
The components of Aggregate Demand are: Select one: a. Consumption spending, Investment spending, government spending and...
The components of Aggregate Demand are: Select one: a. Consumption spending, Investment spending, government spending and spending on exports minus imports b. Consumption spending and investment spending only c. Investment spending and government spending only d. Only spending on exports minus imports and consumption spending
Question 1 (1 point) An increase in government spending will shift the aggregate demand curve to...
Question 1 (1 point) An increase in government spending will shift the aggregate demand curve to the left. True False Question 2 (1 point) When federal government spending exceeds tax revenues, the federal government runs a budget surplus True False Question 3 (1 point) Taxation and government spending are examples of fiscal policy tools used to stabilize an economy. True False Question 4 (1 point) Gross domestic product calculations count only final goods and services because: a one cannot calculate...
Suppose government spending increases.
True or False: The effect on aggregate demand would be larger if the Federal Reserve held the money supply constant in response than if the Fed were committed to maintaining a fixed interest rate.
36. True or False: In order to accomplish the same change in aggregate demand, the government will always need to increase spending more than a change a tax. a. True b. False 37. When the government increases taxes and government spending by the same amount a. The Ricardo-Barro effect predicts less savings and the government is still b. The government must increase the deficit to finance the spending and the c. There is no change in the government budget deficit...
True or False: The reasons for the downward slope of an aggregate demand curve include the real balances effect, the interest-rate effect, and the net exports effect. True O False Although the AD and market demand curves are both downward sloping, the two concepts are different because the AD curve deals with prices and a ー, while the market demand curve deals with prices and a For each scenario in the following table, indicate whether the aggregate demand curve will...
the government cuts tases or inereases government spending 20) ) the aggregate demand curve shifts to the right. tne long-run aggregate supply curve shifts to the left. C) the 20) When aggregate demand curve shifts to the left. the short-run aggregate supply curve shifts to the left. t spending without an accompanying increase 21) An increase in govenment spending n taxes demand A) does not increase aggregate B) would effectively eliminate an inflationary gap. Q mquires additional govemment borrowing spending...
The largest component of aggregate spending in the Canadian economy is government spending on goods and services (G). True False
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