AS AD AD, Real Domestic Output Rell to the above diagram Suppose that aggregate
ID: 1127027 • Letter: A
Question
AS AD AD, Real Domestic Output Rell to the above diagram Suppose that aggregate demand increased from ADI to AD2 Fol the price level to staconstant: A. the aggegate supply curve would have to shift letlward B. the aggregate slijp1cune would have to shin rightward. the aggregate supply curve would have to be vertical D real domestic output would have to remain constant the MPC in an eonomy is S, government could shin the aggregate demand curve lightward bS100 billion bv A. ncasing govenment spending by $8O billion. B. deci casing laxcby $25 billion C. decreasing taxcs by S100 bllon D mcrcasing governncnt spending by S25 billion. I1. Il you are estmating your total capenses lor school next semester. you are using money A) a medium of exchange B) a store ofalle C) a uut of account D) an cconomic investment In the United States, the moncy supply (M1) is comprised of. A ois papcr cunency. and checkable deposits, B) currency, checkable deposits, and Series E bonds, C) cons, paper cuncncy. chcckable deposits, and crvdit balances with brokers. D) papei curency cons, gold certificates, and timc deposits. 12 13 lbe puchasing power of the dollar A) has been tncreasing in rccent yearbecause of economic growth. B) anes directly with lhe cost,of-living index C) | s mcrselvtelated to the level of aggregate demand D) is thc a of the price levelExplanation / Answer
9) B. The aggregate supply curve would have to shift rightward.
For remain the price level constant, the supply curve have to shift rightward when aggregate demand increases from AD1 to AD2
10) B. decreasing taxes by 25 million
11) C. A unit of account
As, here to I have estimated the overall expenses, of the next sem, as I have to take this expense into account to eastimate oveall expense properly. So, money here is primarily using as a unit of account
12) A. Coins, Paper Currency and Checkable deposits.
The US supplies money in various forms including Coins, Paper Currency and Checkable deposits,
13) D. is the reciprocal of the price level.
The purchasing power of the dollar is always inversly proportinate to the price level.