Chapter 14 Aggregate Demand and Aggregate Supply

| November 9, 2018

58)
What three effects can alter the aggregate demand curve?

59)
Explain how the wealth effect can affect aggregate demand.

60)
Explain how the interest rate effect can increase aggregate demand.

61)
Identify three key factors that can cause a shift in the aggregate demand
curve.

62)
Define the “consumption function.”

63)
Define “autonomous consumption spending.”

64)
Define the marginal propensity to consume (MPC) and the marginal
propensity to save (MPS), and explain why MPC + MPS always
equals 1.

14.3 Understanding Aggregate Supply

1)
The relationship between the level of prices and the quantity of real GDP
supplied is known as
A)
aggregate supply.
B)
market supply.
C)
aggregate demand.
D)
market demand.

2)
The relationship between the level of prices and total quantity of goods and
services producers are willing to supply is represented by the
A)
aggregate demand curve.
B)
aggregate supply curve.
C) sticky price curve.
D) GDP multiplier.

3)
To determine the equilibrium price level and equilibrium level of real GDP, the
aggregate demand and aggregate supply must
A)
be considered separately.
B)
intersect.
C)
be disregarded.
D)
be considered as a multiplier.

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