Question # 1

The ratio of debt to GDP will be larger

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The lower the real interest rate

The lower the growth rate of output

The lower the in initial debt ratio

The lower the ratio of the primary deficit to GDP

An increase in oil prices, such as the oil shocks in the 70 s, lead to _______ there by causing _____

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A movement along the AS curve cost push inflation

A leftward shift int he AS curve demand pull inflation.

A right ward shift in the AS Curve cost push inflation

a left ward shift in the AS curve cost push inflation

In the Keynesian corss diagram, and cline in autonomous consumer expenditure causes the aggregate demand function to shift _____ the equilibrium level of aggregate output to fall, and the IS curve to shift to the.

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up ; left

up ; right

down ; left

down ; right

In the Keynesian cross diagram, an increase in autonomous consumer function to shift _______ the equilibrium level of aggregate output to rise and the IS curve to shift to the.

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up ; left

up ; right

down ; left

down ; right

Which of the following events will lead to a decrease in the demand for money.

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An increase in the level of aggregate output.

A decrease in the supply of money

A decrease in the interest rate

a decrease in the price level

A checking deposit held at a commercial bank is considered ______ of that bank.

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An asset

Net worth

a liability

Capital

The implementation lag for monetary policy is generally

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Much longer than it is for fiscal policy

Unrelated to central bank action

The same as it is for fiscal policy

Much shorter than it is for fiscal policy.

"Transactions" money is money used as a

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Store of value

Unit of account

Medium of exchange

Standard of deferred payment

Monetary policy can affect output.

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this statement is always true

This statements always false

This statement is true only in the short run

This statement is true only in the medium run and the long run

The quantity of money demanded varies.

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Directly with both prices and output

Inversely with both prices and output

Directly with prices and inversely with output

Inversely with prices and directly with output

In the Keynesian cross diagram a decrease in investment spending because companies become more pessimistic about investment profitability causes the aggregate demand function to shift ______ and the equilibrium level of aggregate output to ______

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up ; rise

up ; fall

down ;rise

down ; fall

During the early years of the Great depression there was a significant decrees n the the money supply that causes. the ______ to shift____

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IS ; Leftward

IS ; rightwards

LM ; Leftward

LM ; rightward

When considering any kind of economics indicator, prices are important because.

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They reflect the value of goods and services.

They are established by the government to control population 's needs

They categorize goods and services by their weight

Historically they have proved to the good predictors of futures unemployment.

an asset that can easily be exchanged for goods and services is called a.

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Financial asset

Barter like asset

Illegitimate asset

Liquid asset

Monetary policy is concerned with influencing.

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The general level of money wages

The level of government expenditure

The price and availability of money

The level of shares on the stock market

The largest source of tax revenue for the federal government is.

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The personal income tax

The social security tax

The property tax

The sales tax

A good that is used as a medium of exchange as well as being a consumption good is called.

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A barter money

A commodity money

A legal tender

A debased money

The IMF is an agency charged with providing.

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Technical assistance to stock market and financial market problems.

Loans for post World War II reconstruction

Short term credit for international balance of payments deficits

Bonds denominated in U.S. dollars as a loan to LDCs

When the central Bank ________ the money supply the LM curve shifts to the _______ interest rates ____________ and equilibrium aggregate output.

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Increase ; right ; fall; increase

increases ; left ; rise ; decrease

decreases ; left ;rise ; increases

decreases ; left ; fall ; increases

A decrease iin money demand other thing equal shifts the _____ curve to the

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IS ; right

Is ; Left

LM ; Left

LM ; Rfight

In the ISLM framework an expansionary monetary policy causes aggregate output to _____________ and the interest rate to

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increase ; increase

Increase ; decrease

decrease ; decrease

decrease ; increase

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