Home / Questions / An increase in government expenditure shifts the AD curve ________ and an increase in tax
An increase in government expenditure shifts the AD curve ________ and an increase in taxes shifts the AD curve ________.
A) rightward; rightward
B) rightward; leftward
C) leftward; rightward
D) leftward; leftward
63) Suppose the government of Japan increases its expenditure on goods and services. In the short run, this increase will
A) shift the AD curve in Japan rightward.
B) shift the AD curve in Japan leftward.
C) cause the price level in Japan to fall.
D) None of the above answers is correct.
64) If the government wants to engage in fiscal policy to increase real GDP, it could
A) increase government expenditure in order to increase short-run aggregate supply.
B) decrease government expenditure in order to increase short-run aggregate supply.
C) increase government expenditure in order to increase aggregate demand.
D) decrease government expenditure in order to decrease aggregate demand.
65) If real GDP is less than potential GDP, which of the following fiscal policies would increase real GDP?
A) only a decrease government expenditure
B) only an increase taxes
C) increase government expenditure and/or decrease taxes
D) decrease government expenditure and/or increase taxes
66) Using the AD-AS model, an increase in government expenditure
A) has no impact on real GDP.
B) has no impact on real GDP, but will increase potential GDP.
C) increases both real GDP and the price level.
D) has a full multiplier effect on real GDP, leaving the price level unchanged in the long run.
67) Using fiscal policy, to increase real GDP and employment the government could ________ government expenditure on goods and services or ________ taxes.
A) increase; increase
B) increase; decrease
C) decrease; increase
D) decrease; decrease
68) When real GDP is less than potential GDP, an increase in government expenditures will ________ real GDP and ________ the price level.
A) increase; raise
B) increase; lower
C) decrease; raise
D) decrease; lower
69) Suppose the economy is at a short-run equilibrium with real GDP greater than potential GDP. Which of the following fiscal policies would decrease real GDP and the price level?
A) an increase in government expenditure
B) a decrease in taxes
C) an increase in taxes
D) None of the above answers is correct.
70) Suppose real GDP exceeds potential real GDP. If the government decreases its expenditures on goods and services, then real GDP ________ and the price level ________.
A) decreases; rises
B) increases; falls
C) decreases; falls
D) increases; rises
71) Suppose that the government decreases its expenditures on goods and services. Within the AS-AD model, the result will be ________ in real GDP and ________ in the price level.
A) an increase; an increase
B) an increase; a decrease
C) a decrease; an increase
D) a decrease; a decrease
Dec 08 2019 View more View Less
Choose one of the following three topics: Should Personal Auto Insurance be Mandatory? Should an Individuals Credit Score be used in Personal Lines (Auto, Homeowner...
May 20 2020In small companies with few employees, it is virtually impossible to implement the segregation of duties control plan.” Do you agree? Why or why not?2. “No matter how sop...
May 07 2020Find the arclength of y=sinx, 0 ≤ x ≤ π/3 using the trapezoidal rule T6.
Jun 11 2021I just want the solution for QUESTION 3 stated in the assignment, the Journal entriesto eliminate the investment in subsidiary at 31 December 2019.
Dec 06 2019Reservation Scheduling: Roth Auto Rentals, a car rental company special-izing is SUVs, is making up a schedule for the next weekend's demands. The peak demand period occu...
Aug 03 2020Draw the shear and moment diagrams for the beam. Then answer the questions. The distancex is measured from the left end of the beam to the right.
May 24 2020After careful? analysis, Dexter Brothers has determined that its optimal capital structure is composed of the sources and target market value weights shown in the followi...
Apr 13 2020Rachel is single and has a college degree in finance. She is employed as a loan officer at a bank; her yearly AGI approximates $50,000. During the year, she enrolled in a...
Aug 08 2021Chloroform, CHCl3, has a normal boiling point of 61°C. Its vapor pressure at 43°C is 0.526 atm. What is the concentration (in g/L) of CHCl3 when it saturates the air at 27°C?
Aug 17 2021Describe the three performance variables that should be considered for change in every analysis. Explain how each would impact a corporate "bottom line" - their net gain ...
May 25 2020