MBA 505 Chapter 22 Quiz
1. Which is the correct definition of aggregate planned expenditures AE?
a. C+S+G-X
b. C+I+G+X
c. C+I+G-X
d. C+S+G+X
e. C+S-T+X
2. On the Keynesian consumption function, what does the intersection of the consumption function with the 45-degree line mean?
a. equilibrium real GDP
b. positive saving, negative dissaving
c. zero saving, zero dissaving
d. negative saving, positive dissaving
e. equilibrium consumption and saving
3. Which of the following expressions gives the slope of the Keynesian saving function?
a. MPC + MPS
b. MPC-MPI
c. 1 - MPS
d. 1 - MPC
e. MPC - MPS
4. Which of the following expressions gives the slope of the Keynesian aggregate expenditures (AE) function?
a. MPC + MPS
b. MPC+MPI
c. MPC-MPI
d. 1 - MPC
e. MPC - MPS
5. On the Keynesian aggregate expenditures (AE) function, a/k/a the Keynesian cross, what does the intersection of the AE with the 45-degree line mean?
a. equilibrium real GDP
b. positive saving, negative dissaving
c. zero saving, zero dissaving
d. negative saving, positive dissaving
e. equilibrium consumption and saving
6. Which curve is derived from the Keynesian aggregate expenditures (AE) function by showing that the AE shifts downward at higher price levels?
a. SRAS
b. LRAS
c. SRAD
d. AD
e. LRAD
Answers
1b,2c,3d,4c,5a,6d.