Unit 8 Macro

If a country's economic data shows that private savings equal $300 million, government spending equals $400 million, taxes equal $300, and the trade surplus equals $100 million, then what does investment equal? $150 million $175 million $200 million $100 million

$100 million

If a country's economic data shows that private savings equal $350 million, government spending equals $375 million, taxes equal $300, and the trade surplus equals $125 million, then what does investment equal? $50 million $150 million $425 million $600 million

$150 million

During a period of very strong economic growth, if a government uses contractionary fiscal policy to decrease GDP, the: -aggregate supply curve will shift to the right. -aggregate supply curve will shift to the left. -aggregate demand curve will shift to the left. -aggregate demand curve will shift to the right.

-aggregate demand curve will shift to the left.

A government deficit has increased from 30 to 50. The country's trade deficit is 100 and private savings equal 65 and investment equal 90. If Ricardian neutrality holds true, after this change in the government's budget, private savings will equal: A. 40. B. 105. C. 95. D. 85.

85.

A government collects $700 billion annually in tax revenue. Each year it allocates $70 billion to the justice system and $130 billion for its own administrative costs. What percentage of annual tax revenue is allocated to these two categories of government spending? A. 37.15% B. 28.57% C. 17.51% D. 27.58%

B. 28.57%

When a government records a budget surplus, the national savings and investment identity is written as: A. S=I+(G-T)+(X-M) B. S+(M-X)+(T-G)=I C. S-(G-T)=I-(X-M) D. S+(T-G)=1+(X-M)

B. S+(M-X)+(T-G)=I

A typical ____________________________ fiscal policy allows government to decrease the level of aggregate demand, through increases in taxes. A. expansionary B. contractionary C. discretionary D. standardized

B. contractionary

If government tax policy requires Jane to pay $25,000 in taxes on annual income of $200,000 and Mary to pay $10,000 in tax on annual income of $100,000, then the tax policy is: A. regressive. B. progressive. C. proportional. D. optional.

B. progressive.

A government annually collects $320 billion in tax revenue and allocates $42 billion to education spending. What percentage of this government's budget is spent on education? A. 24.50% B. 12.31% C. 30.13% D. 13.12%

D. 13.12%

If the government for the state of Washington collects $65.8 billion in tax revenues in 2013 and total spending in the same year is $74.8 billion, the result will be: an increase in payroll tax. an increase in excise tax. a budget surplus. a budget deficit.

a budget deficit.

When the interest rate in an economy increases, it is likely the result of either: -a decrease in the government's budget surplus or an increase in its budget deficit. -a decrease in the government budget surplus or its budget deficit. -an increase in the government budget surplus or a decrease in its budget deficit. -an increase in the government budget surplus or its budget deficit.

a decrease in the government's budget surplus or an increase in its budget deficit.

In the national savings and investment identity framework, an inflow of savings from abroad is, by definition, equal to: private sector investment. the trade surplus. the trade deficit. domestic household savings.

the trade deficit.