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I have a set of Economic questions. I will post individually

Customer Question

I have a set of Economic questions. I will post individually so you get credit for each one. They are multiple choice. Help please
Submitted: 2 years ago.
Category: Homework
Expert:  Sandhya replied 2 years ago.
Hi,

Can I take a look at your questions?

Thanks
Customer: replied 2 years ago.
1. If government increases lump-sum taxes by $20 billion and the economy's MPC is .6, then the:
Answer
consumption schedule will shift upward by $12 billion.
consumption schedule will shift downward by $12 billion.
equilibrium GDP will increase by $40 billion.
equilibrium GDP will decrease by $40 billion.

2.
In a private closed economy, when aggregate expenditures exceed GDP:
Answer
GDP will decline.
business inventories will rise.
saving will decline.
business inventories will fall.

3.
(Last Word) Classical macroeconomics was dealt severe blows by:
Answer
the Great Depression and Keynes's macroeconomic theory.
the Second World War and the writings of Milton Friedman.
XXXXX XXXXX and his idea of the invisible hand.
the strong recovery after the Second World War and Alvin Hansen's stagnation thesis.


4. http://imageshack.us/photo/my-images/706/unledva.jpg/

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7.
If government increases its tax revenues by $15 billion and the MPC is 2/3, then we can expect the equilibrium GDP to:
Answer
decrease by $30 billion.
decrease by $45 billion.
decrease by $35 billion.
decrease by $55 billion.


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10.
In the aggregate expenditures model, an increase in government spending may:
Answer
decrease real GDP.
increase output and employment.
shift the aggregate expenditures schedule downward.
reduce the size of the inflationary gap.
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13.
Which of the following statements concerning the equilibrium level of GDP is incorrect?
Answer
there will be no tendency for businesses to alter the aggregate rate of production
full employment will necessarily be realized
no unintended changes in inventories will occur
leakages equal injections
14.
For a private closed economy, an unintended decline in inventories suggests that:
Answer
aggregate expenditures are less than the business sector expected them to be.
aggregate expenditures exceed GDP.
actual investment exceeds saving.
planned investment is greater than consumption.
15.
Planned investment equals saving:
Answer
at all levels of GDP.
at all below-equilibrium levels of GDP.
at all above-equilibrium levels of GDP.
only at the equilibrium GDP.

16. Suppose the economy is operating at its full-employment-noninflationary GDP and the MPC is 0.75. The Federal government now finds that it must increase spending on military goods by $21 billion in response to deterioration in the international political situation. To sustain full-employment-noninflationary GDP government must:
Answer
reduce taxes by $28 billion.
reduce transfer payments by $21 billion.
increase taxes by $21 billion.
increase taxes by $28 billion.
17.
If a nation imposes tariffs and quotas on foreign products, the immediate effect will be to:
Answer
reduce the rate of domestic inflation.
increase efficiency in the world economy.
increase domestic output and employment.
reduce domestic output and employment.
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19.
The U.S. recession of 2001 provides a good example of:
Answer
demand-pull inflation.
cost-push inflation.
a recessionary expenditure gap.
the repercussions of hyperinflation.
20.
Which of the following statements is incorrect?
Answer
Given the economy's MPS, a $15 billion reduction in government spending will reduce the equilibrium GDP by more than would a $15 billion increase in taxes.
Other things unchanged, a tax reduction of $10 billion will increase the equilibrium GDP by $25 billion when the MPS is 0.4.
If the MPC is 0.8 and GDP has declined by $40 billion, this was caused by a decline in aggregate expenditures of $8 billion.
A government surplus is anti-inflationary; a government deficit is expansionary.


21.
Other things equal, if a change in the tastes of American consumers causes them to purchase more foreign goods at each level of U.S. GDP:
Answer
unemployment will decrease domestically.
U.S. GDP will fall.
inflation will occur domestically.
U.S. real GDP will rise.

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23.
If the MPC is .50, all taxes are lump-sum taxes, and the equilibrium GDP is $40 billion below the full-employment GDP, then the size of the recessionary expenditure gap is:
Answer
$40 billion.
$20 billion.
$60 billion.
$80 billion.
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25.
In the aggregate expenditures model, equilibrium GDP in a private closed economy is indicated by:
Answer
the equality of saving and planned investment.
the intersection of aggregate expenditures and the 45-degree line.
the absence of unplanned changes in inventories.
all of these.

26.
If net exports decline from zero to some negative amount, the aggregate expenditures schedule would:
Answer
shift upward.
shift downward.
not move (net exports do not affect aggregate expenditures).
become steeper.
27.
If a lump-sum tax of $40 billion is imposed and the MPC is 0.6, the saving schedule will shift:
Answer
downward by $24 billion.
upward by $24 billion.
downward by $16 billion.
28.
Investment and saving are, respectively:
Answer
income and wealth.
stocks and flows.
injections and leakages.
leakages and injections.

29. http://imageshack.us/photo/my-images/838/unledqsm.jpg/

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31.
In a mixed closed economy:
Answer
government purchases and saving are injections, while investment and taxes are leakages.
taxes and government purchases are leakages, while investment and saving are injections.
taxes and savings are leakages, while investment and government purchases are injections.
taxes and investment are injections, while saving and government purchases are leakages.
32.
Actual investment is:
Answer
gross investment less replacement investment.
the ratio of planned investment to unintended increases in inventories.
unintended increases in inventories less planned investment.
planned investment plus unintended increases in inventories.

33.
In moving from a private closed economy to a mixed closed economy in the aggregate expenditures model, government spending must be:
Answer
added to saving.
added to consumption and gross investment.
subtracted from consumption and gross investment.
added to gross investment and saving.

34. http://imageshack.us/photo/my-images/823/unledjfo.jpg/

35. http://imageshack.us/photo/my-images/819/unledsu.jpg/

36.
A recessionary expenditure gap is:
Answer
the amount by which the full-employment GDP exceeds the level of aggregate expenditures.
the amount by which equilibrium GDP falls short of the full-employment GDP.
the amount by which investment exceeds saving at the full-employment GDP.
the amount by which aggregate expenditures exceed the full-employment level of GDP.

37. http://imageshack.us/photo/my-images/14/unledljl.jpg/

38.
If the multiplier in an economy is 5, a $20 billion increase in net exports will:
Answer
increase GDP by $100 billion.
reduce GDP by $20 billion.
decrease GDP by $100 billion.
increase GDP by $20 billion.
39. http://imageshack.us/photo/my-images/24/unledjlt.jpg/

40.
The equilibrium level of GDP is associated with:
Answer
an excess of planned investment over saving.
no unintended changes in inventories.
an unintended decrease in business inventories.
an unintended increase in business inventories.



You can post the answer indvidiually. It needs to be turned in 1 hour in 15 minutes. Thank you.
Expert:  Sandhya replied 2 years ago.
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Sandhya, Tutor
Category: Homework
Satisfied Customers: 3629
Experience: I have several years of teaching experience.
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Customer: replied 2 years ago.
Sandhya, Excuse me I will accept your answer my blackboard is messing up. Pause on any more answering of the questions until it comes back on.
Expert:  Sandhya replied 2 years ago.
Okay, I am online for next one more hour..Let me know if it becomes okay during that period.

Thanks

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