econ 202 hw w7
this does not cause AD to shift
a change in the price level
the international-trade effect refers to the fact that an increase in the price level will result in
a decrease in exports and and an increase in imports.
which of the following would cause an a decrease in AD
a decrease in government spending
which of the following cause the short-run AS curve to shift to the right
a positive technological change
the aggregate demand curve slopes downward [BLANK], and the demand curve for an individual product slopes downward [BLANK].
due to the wealth effect, the interest-rate effect and the international-trade effect, due to consumers substituting the more expensive product for cheaper goods.
Aggregate Demand (AD) is comprised of expenditure components that include
government spending consumption investment next exports
the interest rate effect refers to the fact that a higher price level results in
higher interest rates and lower investments
the short run AS curve slopes upward because of all the following reasons except
in the short run, an unexpected change in the price of import resource can change the cost to firms.
firms become more optimistic and increase their spending on machinery and equipment. Because this is a change in [BLANK], it will cause a [BLANK] the aggregate demand curve.
investment, shift to the right in
according to the wealth effect, when the [BLANK] falls, the [BLANK] rises.
price level; the real value of household wealth
the recession of 07-09 made many consumer pessimistic about their future incomes. how does this increased pessimism affect the AD curve?
shift AD curve to the left
more capital accumulation will cause the long run aggregate supply curve to
shift to the right
the US economy experience 4 percent inflation. Because this is a change in [BLANK], it will cause a [BLANK] the aggregate demand curve.
the price level, movement along
increases in personal income taxes or business taxes will make aggregate demand curve shift [BLANK]
to the left
the wealth effect refers to the fact that
when the price level falls, the real value of household wealth rises, and so will consumption
the aggregate demand curve slopes downward for all of the following reasons except
A lower price level makes imports from other countries less expensive and US citizens buy more imports
if AD just increase, what could have caused the increase?
An increase in government purchases
increases in the value of the dollar relative to foreign currencies will make the aggregate demand curve shift [BLANK]
To the left
this will shift AD curve to the right, all else equal.
an increase in net exports
which of the following causes the short run AS curve to shift to the left
an increase in the expected price of an important natural resource
how can government policies shift the aggregate demand curve to the right
by increasing gov purchases
the long-run AS curve is vertical because in the long run,
changes in the price level do not affect potential GDP, as potential GDP depends on the size of the labor force, capital stock and technology
the federal government increases taxes in an attempt to reduce a budget deficit. Because this is a change in [BLANK], it will cause a [BLANK] the aggregate demand curve.
consumption, shift to the left in
higher personal income taxes
decrease AD