Question 1

Suppose that during 2009, the actual real GDP of Chile was 3.5 billion pesos at the same time the potential GDP was 3.4 billion pesos. What sort of equilibrium existed in Chile?

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Question 2

What are the components of fiscal policy? Explain how fiscal policy affects aggregate demand.

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Question 3

If the world economy expands so that foreign demand for U.S.-made goods increases, in the short run what will happen to aggregate demand, the price level, and real GDP in the U.S.?

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Question 4

-In the above figure, what is the short-run equilibrium real GDP and the short-run equilibrium price level?

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-In the above figure, what is the...

Question 5

What happens to the aggregate demand curve in the United States if the exchange rate increases so that U.S.-made products become more expensive?

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Question 6

How does the aggregate demand curve reflect an increase in aggregate demand?

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Question 7

Assume the equilibrium price level is 140 and the equilibrium real GDP is $15 trillion. What happens if the current price level equals 125?

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Question 8

What are the factors that can shift the short-run aggregate supply curve but not the long-run aggregate supply curve? Explain your answer.

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Question 9

Give examples of factors that decrease aggregate demand. Which way does the aggregate demand curve shift?

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Question 10

What happens if the economy is at its long-run equilibrium and aggregate demand increases?

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Question 11

What is the effect on the aggregate demand curve from an increase in the price level? In particular, does the aggregate demand curve shift leftward or rightward?

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Question 12

Compare the policy prescriptions of Keynesian, Classical, and Monetarist economists.

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Question 13

-Based on the table above,
a)What is the equilibrium price level and real GDP?
b)If potential GDP is $11.0 trillion, what does that imply about the economy's level of employment?
c)If potential GDP is $9.0 trillion, what does that imply about the economy's level of employment?

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-Based on the table above,
a)What is the...

Question 14

What are the substitution effects that affect aggregate demand?

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Question 15

What two variables are determined in an aggregate supply-aggregate demand figure? Is the slope of the short-run aggregate supply curve positive or negative? Is the slope of the aggregate demand curve positive or negative?

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Question 16

What are fiscal and monetary policies? Do they have an immediate effect on the AD curve or the SAS curve?

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Question 17

How do changes in the money wage rate affect the LAS and SAS curves? Explain your answer.

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Question 18

Explain the reasons why the AD curve slopes downward.

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Question 19

Explain the relationship of the long-run aggregate supply curve, the short-run aggregate supply curve and the aggregate demand curve in determining a long-run and short-run macroeconomic equilibrium.

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Question 20

What is the difference between a recessionary gap and an inflationary gap?

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Quiz 10: Aggregate Supply and Aggregate Demand