Question 1

If we graph the consumption function such that it starts above the origin,this is because we are assuming that

Accepted Answer

A)   the MPC is positive.
B)   the MPS is positive.
C)   autonomous consumption is positive.
D)   induced consumption is positive.

Question 2

If total production is greater than total expenditures,

Accepted Answer

A)   there will be an increase in saving.
B)   there will be an increase in inventories.
C)   firms will then increase production.
D)   firms will then increase prices.

Question 3

Exhibit 10-1 1. B)  Q2. C)  Q3. D)  Q1 and Q3. E)  none of the above" class="answers-bank-image d-inline" rel="preload" >
-Refer to Exhibit 10-1.Equilibrium Real GDP occurs at

Accepted Answer

A)   Q1.
B)   Q2.
C)   Q3.
D)   Q1 and Q3.
E)   none of the above

Question 4

Using the concept of the multiplier,explain in detail how college students flocking to beach towns for spring break can positively impact the beach towns' economies.

Accepted Answer

College students on spring break will sp...

Question 5

Exhibit 10-8
 
-Refer to Exhibit 10-8.When disposable income equals $2,000,saving equals

Accepted Answer

A)   $1,800.
B)   $2,100.
C)   $200.
D)   -$200.

Question 6

Explain how the Keynesian view differs from the classical view with respect to saving.Explain further how the two views differ with respect to investment.

Accepted Answer

Classical economists believed that the a...

Question 7

An increase in autonomous consumption,an increase in disposable income,or a decrease in the marginal propensity to consume can all increase consumption.

Accepted Answer

A) True 
 B)False

Question 8

The economy is in equilibrium,TP = TE,and Real GDP is $500 billion.The MPC is 0.95,the multiplier is operative,and idle resources exist at each expenditure round.Autonomous investment spending rises by $4 billion.As a result,the TE curve shifts __________,inventory levels unexpectedly __________,business firms __________ the quantity of goods and services they produce,and Real GDP __________ by __________.

Accepted Answer

A)   upward;fall;increase;rises;$3.8 billion
B)   upward;fall;increase;rises;$8 billion
C)   downward;rise;decrease;falls;$80 billion
D)   upward;fall;increase;rises;$80 billion
E)   downward;fall;decrease;falls;$3.8 billion

Question 9

The efficiency wage model is an explanation of wage __________ and thus a support for __________ macroeconomics.

Accepted Answer

A)   flexibility;Keynesian
B)   flexibility;classical
C)   inflexibility;Keynesian
D)   inflexibility;classical

Question 10

Exhibit 10-4 1,autonomous consumption is equal to A)  C0. B)  C1. C)  C2. D)  C1 - C0. E)  C2 - C1." class="answers-bank-image d-inline" rel="preload" >
-Refer to Exhibit 10-4.If the present level of disposable income is Yd1,autonomous consumption is equal to

Accepted Answer

A)   C0.
B)   C1.
C)   C2.
D)   C1 - C0.
E)   C2 - C1.

Question 11

The answer is: "It is sometimes in the best interest of business firms to pay their employees higher-than-equilibrium wage rates." What is the question?

Accepted Answer

A)   What do efficiency wage models imply?
B)   What do classical economists say?
C)   What is the central tenet of Say's law?
D)   What did John Maynard Keynes say was the reason for inflexible wages?
E)   none of the above

Question 12

Here is a consumption function: C = C0 + MPC(Yd) .If consumption is $3,300,MPC =0.85,and disposable income is $2,100,what does autonomous consumption equal?

Accepted Answer

A)   $899.15
B)   $450
C)   $1,515
D)   $4,785
E)   none of the above

Question 13

When the MPC = 0.6,the multiplier is

Accepted Answer

A)   0.40.
B)   2.50.
C)   1.67.
D)   6.00.

Question 14

Efficiency wage models imply that workers are more productive when they are paid a higher wage,as compared to when they are paid a lower wage.

Accepted Answer

A) True 
 B)False

Question 15

John Maynard Keynes wrote which of the following?

Accepted Answer

A)   Das Kapital
B)   The Scope and Method of Political Economy
C)   Wealth of Nations
D)   The General Theory of Employment,Interest and Money
E)   all of the above

Question 16

Exhibit 10-1 3,there is a tendency for Real GDP to A)  rise. B)  fall. C)  remain unchanged. D)  There is not enough information to answer this question." class="answers-bank-image d-inline" rel="preload" >
-Refer to Exhibit 10-1.At Q3,there is a tendency for Real GDP to

Accepted Answer

A)   rise.
B)   fall.
C)   remain unchanged.
D)   There is not enough information to answer this question.

Question 17

If total production is less than total expenditures,then business firms

Accepted Answer

A)   have overproduced.
B)   will cut back on production.
C)   will raise production.
D)   will experience increases in inventory.
E)   a and d

Question 18

The change in disposable income is $200 and the change in saving is $50.What is the marginal propensity to consume (MPC) ?

Accepted Answer

A)   0.25
B)   0.50
C)   0.66
D)   0.75
E)   There is not enough information to answer the question.

Question 19

A decline in housing prices can help to push the economy into a recessionary gap.

Accepted Answer

A) True 
 B)False

Question 20

Exhibit 10-2 
-Refer to Exhibit 10-2.Equilibrium Real GDP occurs at

Accepted Answer

A)   $3,000 billion.
B)   $1,500 billion.
C)   $7,500 billion.
D)   $4,000 billion.
E)   $4,500 billion.

Exam 10: Keynesian Macroeconomics and Economic Instability: a Critique of the Self-Regulating Economy

The change in disposable income is $200 and the change in saving is $50.What is the marginal propensity to consume (MPC) ?

Correct Answer
verified

Using the concept of the multiplier,explain in detail how college students flocking to beach towns for spring break can positively impact the beach towns' economies.

Correct Answer
verified
College students on spring break will sp...
View Answer

If total production is greater than total expenditures,

Correct Answer
verified

Efficiency wage models imply that workers are more productive when they are paid a higher wage,as compared to when they are paid a lower wage.

Correct Answer
verified

The answer is: "It is sometimes in the best interest of business firms to pay their employees higher-than-equilibrium wage rates." What is the question?

Correct Answer
verified

When the MPC = 0.6,the multiplier is

Correct Answer
verified

Exhibit 10-1 -Refer to Exhibit 10-1.At Q₃,there is a tendency for Real GDP to

Correct Answer
verified

If total production is less than total expenditures,then business firms

Correct Answer
verified

Correct Answer
verified

John Maynard Keynes wrote which of the following?

Correct Answer
verified

The efficiency wage model is an explanation of wage and thus a support for macroeconomics.

Correct Answer
verified

Exhibit 10-2 -Refer to Exhibit 10-2.Equilibrium Real GDP occurs at

Correct Answer
verified

A decline in housing prices can help to push the economy into a recessionary gap.

Correct Answer
verified

Exhibit 10-4 -Refer to Exhibit 10-4.If the present level of disposable income is Yd₁,autonomous consumption is equal to

Correct Answer
verified

Here is a consumption function: C = C₀ + MPC(Y_d) .If consumption is $3,300,MPC =0.85,and disposable income is $2,100,what does autonomous consumption equal?

Correct Answer
verified

An increase in autonomous consumption,an increase in disposable income,or a decrease in the marginal propensity to consume can all increase consumption.

Correct Answer
verified

Explain how the Keynesian view differs from the classical view with respect to saving.Explain further how the two views differ with respect to investment.

Correct Answer
verified
Classical economists believed that the a...
View Answer

Exhibit 10-8 -Refer to Exhibit 10-8.When disposable income equals $2,000,saving equals

Correct Answer
verified

If we graph the consumption function such that it starts above the origin,this is because we are assuming that

Correct Answer
verified

Exhibit 10-1 -Refer to Exhibit 10-1.Equilibrium Real GDP occurs at

Correct Answer
verified

Exam 10: Keynesian Macroeconomics and Economic Instability: a Critique of the Self-Regulating Economy

The change in disposable income is $200 and the change in saving is $50.What is the marginal propensity to consume (MPC) ?

Correct AnswerverifiedShow Answer

Using the concept of the multiplier,explain in detail how college students flocking to beach towns for spring break can positively impact the beach towns' economies.

Correct AnswerverifiedCollege students on spring break will sp...View AnswerShow Answer

If total production is greater than total expenditures,

Correct AnswerverifiedShow Answer

Efficiency wage models imply that workers are more productive when they are paid a higher wage,as compared to when they are paid a lower wage.

Correct AnswerverifiedShow Answer

The answer is: "It is sometimes in the best interest of business firms to pay their employees higher-than-equilibrium wage rates." What is the question?

Correct AnswerverifiedShow Answer

When the MPC = 0.6,the multiplier is

Correct AnswerverifiedShow Answer

Exhibit 10-1 -Refer to Exhibit 10-1.At Q3,there is a tendency for Real GDP to

Correct AnswerverifiedShow Answer

If total production is less than total expenditures,then business firms

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

John Maynard Keynes wrote which of the following?

Correct AnswerverifiedShow Answer

The efficiency wage model is an explanation of wage __________ and thus a support for __________ macroeconomics.

Correct AnswerverifiedShow Answer

Exhibit 10-2 -Refer to Exhibit 10-2.Equilibrium Real GDP occurs at

Correct AnswerverifiedShow Answer

A decline in housing prices can help to push the economy into a recessionary gap.

Correct AnswerverifiedShow Answer

Exhibit 10-4 -Refer to Exhibit 10-4.If the present level of disposable income is Yd1,autonomous consumption is equal to

Correct AnswerverifiedShow Answer

Here is a consumption function: C = C0 + MPC(Yd) .If consumption is $3,300,MPC =0.85,and disposable income is $2,100,what does autonomous consumption equal?

Correct AnswerverifiedShow Answer

An increase in autonomous consumption,an increase in disposable income,or a decrease in the marginal propensity to consume can all increase consumption.

Correct AnswerverifiedShow Answer

Explain how the Keynesian view differs from the classical view with respect to saving.Explain further how the two views differ with respect to investment.

Correct AnswerverifiedClassical economists believed that the a...View AnswerShow Answer

Exhibit 10-8 -Refer to Exhibit 10-8.When disposable income equals $2,000,saving equals

Correct AnswerverifiedShow Answer

If we graph the consumption function such that it starts above the origin,this is because we are assuming that

Correct AnswerverifiedShow Answer

Exhibit 10-1 -Refer to Exhibit 10-1.Equilibrium Real GDP occurs at

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified
College students on spring break will sp...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Exhibit 10-1 -Refer to Exhibit 10-1.At Q₃,there is a tendency for Real GDP to

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

The efficiency wage model is an explanation of wage and thus a support for macroeconomics.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Exhibit 10-4 -Refer to Exhibit 10-4.If the present level of disposable income is Yd₁,autonomous consumption is equal to

Correct Answer
verified

Here is a consumption function: C = C₀ + MPC(Y_d) .If consumption is $3,300,MPC =0.85,and disposable income is $2,100,what does autonomous consumption equal?

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Classical economists believed that the a...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
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