MACROECONOMICS W/CONNECT
18th Edition
ISBN: 9781307253092
Author: McConnell
Publisher: Mcgraw-Hill/Create
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Question
Chapter 6, Problem 3RQ
To determine
Economics real GDP.
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Based on the graph, a decrease in ________ could cause the economy to move from Point A to Point B.
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- which of the following probably occurred as the U.S. economy experienced increasing real GDP in 1954? Check all that apply A. Consumer spending increased B. Industrial production declined C. Retail sales increased C. Home sales declinedarrow_forwardTrue or False: Aggregate demand (AD) represents the total amount of goods and services that households, firms, the government, and foreigners are willing to buy at various price levels. A. True B. Falsearrow_forwardAn economy is at full employment. Which of the following events can create a recessionary gap? A.An increase in foreign income. B.An increase in government spending. C.An increase in taxes. D.A decrease in nominal wages.arrow_forward
- Which statement is false? Select one: a. If consumers and businesses both increase spending, everyone's incomes falls. b. Consumer spending is business income. c. Falling wages decrease demand in output markets. d. Business spending is consumer income. e. If consumers and businesses both increase spending, employment increases.arrow_forwardWhich of the following will NOT lead to an increase in real GDP? A. On average, people in a country decide to increase the number of hours they work by 5%. B. Spending on homeland security increases in response to a terrorist attack. C. The price level and nominal GDP increase by 10%. D. Due to lower interest rates by the Fed investors increase their investmenarrow_forwardA. Using the average price for all three goods, real GDP in 2012 is $___. (Enter your response as an integer.) B. Using the average prices for all three goods, real GDP in 2013 is $___. (Enter your response as an integer.) C. The percentage change in real GDP from 2012 to 2013 is __ percent. (Round your response to two decimal places.) D. Using the average prices, the GDP deflator for 2012 is ____ . (Round your response to two decimal places.) E. Using the average prices, the GDP deflator for 2013 is ____percent. (Round your response of two decimal places.) F. Using the GDP deflators recorded above the rate of inflation from 2012 to 2013 is ___ percent. (Round your response to two decimal places.)arrow_forward
- Suppose real GDP exceeds potential real GDP. If the government decreases its expenditures on goods and services, then real GDP _______and the price level ________ (a) Decreases; rises (b) Increases; falls (c) Decreases; falls (d) Increases, risesarrow_forwardThree points each part. Answer the following: a. Real GDP in 2021 using 2020 prices was (write out the number) b. Is output higher in 2021 than in 2020 using 2020 prices? (Yes or No) Good P2020 P2021Q2020 Q2021 Wine $120 $130 60 70 Cheese $30 $40 50 30arrow_forwardWhich of the following is not a component of the aggregate demand curve?a.Government spending(G)b.Investment(I)c.Consumption(C)d.Net Exports(X-M)e.Savingarrow_forward
- Give two examples of goods or services that you have seen inflate dramatically and also deflate dramatically over the past few years.arrow_forwardWhich of the following will NOT lead to an increase in real GDP? A. On average, people in a country decide to increase the number of hours they work by 5%. B. Spending on homeland security increases in response to a terrorist attack. C. The price level and nominal GDP increase by 10%. D. Due to lower interest rates by the Fed investors increase their investmentsarrow_forwarda. either increase or decrease. b. increase. c. decrease. d. remain constant.arrow_forward
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