Question 1

According to the classical theory,the aggregate supply curve is

Accepted Answer

A)  downward sloping.
B)  horizontal.
C)  upward sloping.
D)  vertical.E) A) and B)
F) A) and C)

Question 2

Joe's increase in wages has been identical to the increase in the price level.Joe thinks that he is better off and has increased his expenditures.Joe's behavior is consistent with

Accepted Answer

A)  Say's Law.
B)  the classical model.
C)  a vertical aggregate supply curve.
D)  money illusion.E) B) and C)
F) None of the above

Question 3

For several years,the U.S.unemployment rate has been below the European unemployment rate.Offer a Keynesian explanation for this.

Accepted Answer

The aggregate supply curve in Europe is ...

Question 4

Some economists believe that a positive aggregate demand shock to an economy with large amounts of excess capacity and unemployment does not necessarily cause an increase in prices.Economists who adhere to this belief are followers of

Accepted Answer

A)  classical economics.
B)  Say's laws of economics.
C)  Keynesian economics.
D)  supply-side economics.E) B) and C)
F) A) and D)

Question 5

Compare the effects of an increase in aggregate demand when the price level is fixed versus when it can change.

Accepted Answer

<img  loading="lazy" src="/assets/images/blured-textbook.svg" class="d-inline m-1" alt="blured image" width="139" height="30"> The above figure shows the effects.An i...

Exam 11: Classical and Keynesian Macro Analyses

Compare the effects of an increase in aggregate demand when the price level is fixed versus when it can change.

Correct Answer
verified
The above figure shows the effects.An i...
View Answer

Joe's increase in wages has been identical to the increase in the price level.Joe thinks that he is better off and has increased his expenditures.Joe's behavior is consistent with

Correct Answer
verified

For several years,the U.S.unemployment rate has been below the European unemployment rate.Offer a Keynesian explanation for this.

Correct Answer
verified
The aggregate supply curve in Europe is ...
View Answer

Some economists believe that a positive aggregate demand shock to an economy with large amounts of excess capacity and unemployment does not necessarily cause an increase in prices.Economists who adhere to this belief are followers of

Correct Answer
verified

According to the classical theory,the aggregate supply curve is

Correct Answer
verified

Exam 11: Classical and Keynesian Macro Analyses

Compare the effects of an increase in aggregate demand when the price level is fixed versus when it can change.

Correct Answerverified The above figure shows the effects.An i...View AnswerShow Answer

Joe's increase in wages has been identical to the increase in the price level.Joe thinks that he is better off and has increased his expenditures.Joe's behavior is consistent with

Correct AnswerverifiedShow Answer

For several years,the U.S.unemployment rate has been below the European unemployment rate.Offer a Keynesian explanation for this.

Correct AnswerverifiedThe aggregate supply curve in Europe is ...View AnswerShow Answer

Some economists believe that a positive aggregate demand shock to an economy with large amounts of excess capacity and unemployment does not necessarily cause an increase in prices.Economists who adhere to this belief are followers of

Correct AnswerverifiedShow Answer

According to the classical theory,the aggregate supply curve is

Correct AnswerverifiedShow Answer

Correct Answer
verified
The above figure shows the effects.An i...
View Answer

Correct Answer
verified

Correct Answer
verified
The aggregate supply curve in Europe is ...
View Answer

Correct Answer
verified

Correct Answer
verified