Question 44 A weakening in consumer confidence causes a O movement down along the aggregate demand curve. O movement up along the aggregate demand curve. O shift of the aggregate demand curve to the right. O shift of the aggregate demand curve to the left.
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- An increase in consumer confidence in a country will result in a 1.shift of the aggregate demand curve to the right. 2.shift of the aggregate demand curve to the left. 3.movement up the aggregate demand curve to a lower aggregate output. 4.movement down the aggregate demand curve to a higher aggregate output.2. Why the aggregate demand curve slopes downward The graph below shows the aggregate demand (AD) curve a hypothetical economy. At point X, the quantity of output demanded is $500 billion, and the price level is 120. Movin up along the AD curve from point X to point Y, the quantity output demanded falls to $300 billion, and the price level rises to 140. PRICE LEVEL 170 140 130 120 100 90 0 100 200 300 400 500 600 OUTPUT (Billions of dollars) exchange rate As the price level rises, the purchasing power of household real wealth will demanded to 800 effect. causing the quantity of output . This phenomenon is known as the Additionally, as the price level rises, the impact on the domestic interest rate will cause the real value of the dolla in foreign exchange markets. The number of domestic products purchased by foreigners (exports) will therefore and the number of foreign products purchased domestic consumers and firms (imports) will exports will therefore domestic output demanded to…Question 19 E) Listen If the nation's capital stock increases which of following will be affected? O Long Run Aggregate Supply O Investment Demand O A8gregate Demand Short Run Aggregate Supply Question 20 LIsten Regarding the question above, describe the short run result of the change? OPrice level increases and real gross domestic product decreases. Price level increases and real gross domestic product increases. Price level decreases and real gross domestic product increases. Price level decreases and real gross domestic product decreases.
- Which of these is a negative effect of increasing price levels? a. Increases the real value of money O b. Encourages higher consumption O c. Shifts aggregate demand outward O d. moves aggregate demand downward10. Great Depression In 1939, with the U.S. economy not yet fully recovered from the Great Depression, President Roosevelt proclaimed that Thanksgiving would fall a week earlier than usual so that the shopping period before Christmas would be longer. Graph A Graph B LRAS Aggregate Supply Aggregate Demand Price Level LRAS Quantity of Output Price Level Aggregate Supply Aggregate Demand Quantity of OutputQUESTION 1 What causes the aggregate demand curve to shift to the right? An increase in net exports O an increase in labor (L) O A decrease in net exports O An increase in the inputs of production
- 21) Ceteris paribus, a decrease in exports leads to a: movement up and to the left along the same aggregate demand curve. movement down and to the right along the same aggregate demand curve. right shift of the aggregate demand curve. left shift of the aggregate demand curve.2. The model of aggregate demand and supply represents O A. the relationship between the real Gross Domestic Product and the overall price level O B. the changes in Gross Domestic Product over time O C. the relationship between the inflation and unemployment rates O D. the changes in the price level over timeQuestion 28 Macroeconomists would suggest that an economy experiencing high unemployment should adopt policies to O reduce aggregate demand. O increase aggregate demand. O increase aggregate supply. O reduce aggregate supply.
- tion 6 According to aggregate supply and aggregate demand analysis, what happens to P (price level) and Q (GDP) if X increases? Oa. Prices decrease and GDP decreases. O b. Prices increase and GDP decreases. Oc Prices stay the same and so does GDP i AS and AD curves shift by the same amount O d. Prices increase and GDP increases. estion will save this response.If both imports and exports rose, O aggregate demand (AD) would decrease. Oaggregate demand (AD) would increase. aggregate demand (AD) would decrease if exports rose more than imports. aggregate demand (AD) would increase if imports rose more than exports. aggregate demand (AD) would increase if exports rose more than imports.9. Draw an aggregate demand and supply diagram for Japan. In the diagram, show how each of the following affects aggregate demand and supply. a. The U.S. gross domestic product falls. b. The level of prices in Korea falls. c. Labor receives a large wage increase. d. Economists predict higher prices next year.
