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Macroeconomics response questions

When inflation exceeds expected inflation, ________________________. *
1 point
Borrowers and lenders both gain
Borrowers and lenders both lose
Borrowers gain at the expense of lenders
Lenders gain at the expense of borrowers
The slope of the consumption function is equal to *
1 point
The marginal propensity to invest
The marginal propensity to save.
The marginal propensity to consume.
One minus the marginal propensity to consume.
When tax revenues exceed expenditures, the government has a _______, and when expenditures exceed tax revenues, the government has a _______. *
1 point
Budget deficit; budget surplus
Budget debt; budget surplus
Budget surplus; budget deficit
Budget surplus; budget debt
An effective policy under the floating exchange rate is *
1 point
Restrictive Monetary policy
Expansionary Monetary Policy
Expansionary Fiscal Policy
Restrictive Fiscal policy
Money serves all of the following functions EXCEPT *
1 point
Unit of account
Source of barter
Medium of exchange
Store of value
IS curve represent *
1 point
Balance of payment market
Money market
Good and Services market
Investment market.
Following the statement are related with LM curve EXCEPT *
1 point
Money market equilibrium occurs at the intersection of the money supply curve and the money demand curve
Money demand curve is upward sloping
LM curve show the combinations of interest rate and income
Money supply curve is vertical
The marginal propensity to consume is calculated as *
1 point
The change in saving divided by the change in disposable income.
The change in disposable income multiplied by the change in consumption expenditure.
The change in consumption expenditure divided by the change in disposable income.
The change in disposable income divided by the change in consumption expenditure.
An economy has no imports and no taxes. The marginal propensity to save is 0.2. A __________ increase in autonomous expenditure increases equilibrium expenditure by $60 billion and the multiplier is _____________. *
1 point
$ 48 billion; 1.25
$ 75 billion; 12
$ 300 billion; 5
$ 12 billion; 5
The marginal propensity to save is _____________. *
1 point
Always greater than the marginal propensity to consume
Equal to 1 plus the slope of the consumption function
Equal to the slope of the saving function
Equal to the inverse of the marginal propensity to consume
Along the short-run Phillips curve, if the inflation rate falls below its expected rate, the unemployment rate _____________________________. *
1 point
Increase above its natural rate
Decrease below its natural rate.
Remain constant
Equals the natural rate
The figure illustrates an economy’s consumption function. What is the marginal propensity to consume in this economy? *
1 point
1.43
0.95
1.20
0.70
If the government increases its purchases of goods and services, and as a result, the money wage rate increases, the economy has experienced ___________________. *
1 point
A one-time rise in the price level
Cost-push inflation
Demand-pull inflation
Demand-push inflation
The amount by which a change in autonomous expenditure is magnified or multiplied to determine the change in equilibrium expenditure and real GDP is the *
1 point
Marginal propensity to save.
Multiplier.
Marginal propensity to consume.
Autonomous expenditure.
As a measure of money, M1 contains which of the following items? *
1 point
Traveller’s checks
Savings deposits
Money market mutual funds.
Credit cards
Student’s Full Name *
Your answer
Macroeconomic Equilibrium required *
1 point
IS and BP curve intersect
IS, AS-AD and LM intersect
IS, LM and BP curve intersect
AD and AS curve intersect
Aggregate expenditure includes all of the following components except *
1 point
Consumption expenditure.
Saving
Net Export
Government purchase of goods and services
An effective policy under the fixed exchange rate is *
1 point
Restrictive Fiscal policy
Restrictive Monetary policy
Expansionary Fiscal Policy
Expansionary Monetary Policy
The larger the marginal propensity to consume, _________________. *
1 point
The flatter is the consumption function
The greater is the value of the multiplier
The greater is slope of the saving function
The smaller is the value of the multiplier
The amount by which an increase in bank reserves is multiplied to calculate the increase in bank deposits
Liquidity.
Excess reserves.
Deposit multiplier.
Required reserve ratio.

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