Question

In: Economics

Match the event with the appropriate result. Government purchases rise, while tax revenue stays the same....

Match the event with the appropriate result.

Government purchases rise, while tax revenue stays the same. As a result, there is an increase in the government's budget deficit. (Assume the crowding out effect is not significant). In the short run,

A.

The Aggregate Demand curve shifts to the right.

B.

The Short Run Aggregate Supply curve shifts to the right.

C.

The Short Run Aggregate Supply curve shifts to the left.

D.

The Aggregate Demand curve shifts to the left.

Match the event with the appropriate result.

A decrease in the market value of peoples' houses causes consumers' wealth to shrink.

A.

The Aggregate Demand curve shifts to the right.

B.

The Short Run Aggregate Supply curve shifts to the left.

C.

The Short Run Aggregate Supply curve shifts to the right.

D.

The Aggregate Demand curve shifts to the left.

Match the event with the appropriate result.

     

The government raises taxes, but keeps its expenditures the same, causing its budget balance to improve.

A.

The Short Run Aggregate Supply curve shifts to the right.

B.

The Short Run Aggregate Supply curve shifts to the left.

C.

The Aggregate Demand curve shifts to the right.

D.

The Aggregate Demand curve shifts to the left.

Match the event with the appropriate result.

     

Exports rise while imports stay the same.

A.

The Short Run Aggregate Supply curve shifts to the right.

B.

The Short Run Aggregate Supply curve shifts to the left.

C.

The Aggregate Demand curve shifts to the left.

D.

The Aggregate Demand curve shifts to the right.

Match the event with the appropriate result.

      -          

Producers believe the economy is headed for a recession, so they reduce their purchases of machinery and equipment.

A.

The Aggregate Demand curve shifts to the left.

B.

The Short Run Aggregate Supply curve shifts to the right.

C.

The Aggregate Demand curve shifts to the right.

D.

The Short Run Aggregate Supply curve shifts to the left.

Match the event with the appropriate result.

     

Labor productivity improves.

A.

The Short Run Aggregate Supply Curve shifts to the right.

B.

The Aggregate Demand curve shifts to the right.

C.

The Aggregate Demand curve shifts to the left.

D.

The Short Run Aggregate Supply curve shifts to the left.

Match the event with the appropriate result.

     

Commodity prices rise.

A.

The Short Run Aggregate Supply Curve shifts to the left.

B.

The Short Run Aggregate Supply curve shifts to the right.

C.

The Aggregate Demand curve shifts to the left.

D.

The Aggregate Demand curve shifts to the right.

Match the event with the appropriate result.

     

The Federal Reserve pursues a policy that causes interest rates to rise.

A.

The Aggregate Demand curve shifts to the right.

B.

The Short Run Aggregate Supply curve shifts to the left.

C.

The Aggregate Demand curve shifts to the left.

D.

The Short Run Aggregate Supply curve shifts to the right.

Match the event with the appropriate result.

     

Consumers become more optimistic about the future.

A.

The Aggregate Demand curve shifts to the left.

B.

The Short Run Aggregate Supply curve shifts to the left.

C.

The Short Run Aggregate Supply curve shifts to the right.

D.

The Aggregate Demand curve shifts to the right.

Solutions

Expert Solution

Rahul Sunny answered 1 year ago
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