The difference between a change in quantity supplied and a change in supply is that a change in:
a. quantity supplied is caused by a change in a good's own, current price, while a change in supply is caused by a change in some other variable, such as input prices, prices of related goods, expectations, or taxes.
b. supply is caused by a change in a good's own, current price, while a change in the quantity supplied is caused by a change in some other variable, such as input prices, prices of related goods, expectations, or taxes.
c. quantity supplied is a change in the amount people want to sell, while a change in supply is a change in the amount they actually sell.
d. supply and a change in the quantity supplied are the same thing.
Question 2What are the major factors that determine investment, and what impact does each have on aggregate demand?
Question 3Which of the following is true of fiscal policy before the Great Depression of the 1930s?
a. Fiscal policy was made at the federal level.
b. Policies associated with national defense were made at the state level.
c. Environmental degradation and education were the focus areas of the federal government while other areas of government policy were dealt by individual states.
d. The federal budget was determined mostly by economists and not by politicians.
e. National defense and foreign trade were the focus areas of the federal government while other areas of government policy were dealt by individual states.
Question 4A movement along the supply curve might be caused by a change in
a. technology.
b. supplier's input prices.
c. expectations about future prices.
d. the price of the good or service that is being supplied.
Question 5Discuss the difference between an increase in the aggregate demand curve and an increase in the quantity of real GDP demanded. Include a discussion of how the price level relates to each event.
Question 6Identify the correct statement.
a. It is absolutely compulsory for the government to earn a profitable return on the money it earns by selling bonds.
b. When government borrowing rises, interest rates decline, thereby driving up private investment.
c. When interest rates rise, fewer number of corporations offer new bonds to raise investment funds.
d. An increase in interest rate reduces the cost of borrowing by the firms.
e. When interest rates fall, the firm's cost of raising funds through bonds increases.
Question 7An increase in the price of a good will
a. increase supply.
b. decrease supply.
c. increase quantity supplied.
d. decrease quantity supplied.
Question 8Stagflation is generally caused by:
a. an increase in aggregate demand.
b. a decrease in aggregate demand.
c. an increase in aggregate supply.
d. a decrease in aggregate supply.
Question 9If crowding out exists, the expansionary effect of government spending will be:
a. smaller than intended.
b. negative.
c. infinite.
d. larger than intended.
e. zero.
Question 10A decrease in the price of a good will
a. increase supply.
b. decrease supply.
c. increase quantity supplied.
d. decrease quantity supplied.
Question 11A recession is most commonly caused by:
a. an increase in aggregate demand.
b. a decrease in aggregate demand.
c. an increase in aggregate supply.
d. a decrease in aggregate supply.
Quick Reply
