SOLVED

21) Last week, six Swedish kronor could purchase one U.S. dollar. This week, it takes eight Swedish kronor to purchase one U.S. dollar. This change in the value of the dollar will ________ exports from the United States to Sweden and ________ U.S. aggregate demand. A) increase; increase B) decrease; decrease C) increase; decrease D) decrease; increase 22) Suppose the U.S. GDP growth rate is faster relative to other countries’ GDP growth rates. This will  A) move the economy up along a stationary aggregate demand curve. B) move the economy down along a stationary aggregate demand curve. C) shift the aggregate demand curve to the left. D) shift the aggregate demand curve to the right. 23) If aggregate demand just increased, which of the following may have caused the increase? A) an increase in government purchases B) an increase in the interest rate C) an increase in the price level D) an increase in imports 24) How do lower taxes affect aggregate demand? A) They increase disposable income, consumption, and aggregate demand. B) They reduce disposable income, consumption, and aggregate demand. C) they increase corporate investment and aggregate demand. D) They increase aggregate supply and thus increase aggregate demand as well. 25) During the recession of 2007-2009 in the United States, ________ relative to potential GDP. A) business fixed investment spending rose and net export spending declined B) consumption spending rose and residential construction spending declined C) federal government purchases rose and changes in business inventories declined D) net export spending rose and consumption spending declined 26) Refer to Figure 15-1. Ceteris paribus, an increase in the price level would be represented by a movement from A) AD1 to AD2. B) AD2 to AD1. C) point A to point B. D) point B to point A. 27) Refer to Figure 15-1. Ceteris paribus, an increase in interest rates would be represented by a movement from A) AD1 to AD2. B) AD2 to AD1. C) point A to point B. D) point B to point A. 28) Refer to Figure 15-1. Ceteris paribus, an increase in personal income taxes would be represented by a movement from A) AD1 to AD2. B) AD2 to AD1. C) point A to point B. D) point B to point A. 29) Refer to Figure 15-1. Ceteris paribus, a decrease in government spending would be represented by a movement from A) AD1 to AD2. B) AD2 to AD1. C) point A to point B. D) point B to point A. 30) Refer to Figure 15-1. Ceteris paribus, an increase in households’ expectations of their future income would be represented by a movement from A) AD1 to AD2. B) AD2 to AD1. C) point A to point B. D) point B to point A.