a) The federal government cuts taxes for low-income households. During a year of operation, a firm collects $450,000 in revenue and spends $100,000 on labor expense, raw materials, rent and utilities. b. personal consumption, investment, government purchases, and net exports. How does Long Run Aggregate Supply relate to GDP? supply. A stimulation of consumption through an increase in taxes b. How can the elasticity of aggregate demand curve be determined using the LM curve? Ante aggregate demand AD = Y = C + I + cY, what does Y on both sides mean? Thus expectations of future recessions act to lower economic growth and are deflationary in nature. There is a drop in disposable income. ... Q. Assume that the position of a nation's aggregate demand curve has not changed, but the long-run equilibrium price level has declined. In the Keynesian-cross model, actual expenditures differ from planned expenditures by the amount of: a. Unplanned inventory investment b. SURVEY . Suppose the European and Japanese economies succumb to a recession and reduce their demand for U.S. goods for several years. Aggregate Demand - Aggregate Supply model . What is the relationship between aggregate demand and price level? A. Aggregate Supply Quiz Questions Aggregate Supply Quiz Questions . Aggregate demand curve. B. A government is currently operating with an annual budget deficit of $40 billion. Suppose the U.S. economy is operating at full employment. Thus we should expect to see the aggregate supply shrink, which is shown as a shift to the left. B. the aggregate demand curve should be shifted to the left. Suppose that the economy suffers a macroeconomic shock in the form of a False. How is that different from the AD curve in the Keynesian model? Note that it also causes a fall in the price level. 2. Do all government purchases have the same effect on aggregate demand? Below is the new Supply and Demand graph Graph 2.b. The aggregate demand curve slopes downward because it is a horizontal sum of the demand curves for individual goods. Aggregate Demand of an economy is measured in terms of the (expected) Total … A typical first-year college textbook with a Keynesian bent may as a question on aggregate demand and aggregate supply such as: Use an aggregate demand and aggregate supply diagram to illustrate and explain how each of the following will affect the equilibrium price level and real GDP: We will answer each of these questions step-by-step. Learning Objective: Use the dynamic aggregate demand and aggregate supply model to analyse macroeconomic conditions. Aggregate Demand of an economy is measured in terms of the (expected) Total … Chapter 33/Aggregate Demand and Aggregate Supply v 589 . Equilibrium Price. Define supply, demand, and equilibrium price, and explain their relationship with each other. 2. Tags: Question 2 . In order to stabilize the economy, the government might a) decrease the money supply. Are modern economists wrong to focus so heavily on increasing aggregate demand? [10 marks] (b) “The rate of inflation can be most effectively reduced through the use of monetary policy.” Premium Price. As a result, a. the economy is not in equilibrium because it... For the following 5 scenarios use the answers: a. price level=175; real GDP=3000 b. price level=175; real GDP=2600 c. price level=155; real GDP=2825 d. price level=155; real GDP=2675 Start by drawi... 1. SURVEY . Get Answer Now! 1. b. The Aggregate... From 2009 to 2014, Eastlandia experienced large fluctuations in both aggregate consumer spending and disposable income, but wealth, the interest rate, and expected future disposable income did not ch. An income tax change alters investment by an equal and opposite amo... 1. Figure 3 shows aggregate demand, short-run aggregate supply, and long-run aggregate supply. answer choices . Suppose the Central Bank of New Geneland decides to increase the country?s money supply by 15% immediately and every year for the foreseeable future. Solution for Use an aggregate demand and supply diagram to illustrate and explain how each of the following will affect the equilibrium price level and the real… B.the SAS Curve will shift down. Discuss and use explanations (interest rate effect, wealth effects, open economy effect to illustrate your answer). b. Aggregate expenditure equals the sum of consumption, investment, government spending, and net exports. Start studying Aggregate demand and aggregate supply. b) Households decide to save a larger share o... 1. The model of aggregate demand and aggregate supply explains the relationship between _____. An increase in the price level b. All other trademarks and copyrights are the property of their respective owners. The long-run aggr... C=225+0.5Y Consumption function I=125 Planned investment function G=150 Government spending function NX=-50 Next export function Y=C+I+G+NX Equilibrium condition Fill in the following table(round... 1. Which factors when decreased, will result in shifting the aggregate demand (AD) curve to the left? Consider the following news headline: "Business community gloomy about the economy - investment plans axed." T), I = 4, G = 2, and T = 4 a) derive the expenditure function b) calculate equilibrium output c) repeat a and b with G = 2. The 45 degree line drawn to find the demand-side equilibrium: a) Shows all points at which the aggregate demand is equal to aggregate supply, b) Shows all points at which the general price level is... A change in the expected price level shifts A. the aggregate demand curve. In aggregate demand what causes the lags in the effect of monetary and fiscal policy? By using ThoughtCo, you accept our, Professor of Business, Economics, and Public Policy, Aggregate Demand & Aggregate Supply Practice Question - Set-Up, Aggregate Demand & Aggregate Supply Practice Question - Part 1, Aggregate Demand & Aggregate Supply Practice Question - Part 2, Aggregate Demand & Aggregate Supply Practice Question - Part 3, Aggregate Demand & Aggregate Supply Practice Question - Part 4, Aggregate Demand & Aggregate Supply Practice Question - Part 5, Workers Expect High Future Inflation and Negotiate Higher Wages Now, Aggregate Demand & Aggregate Supply Practice Question - Part 6, Technological Improvements Increase Productivity, Expansionary Monetary Policy and Aggregate Demand, How Money Supply and Demand Determine Nominal Interest Rates, Cost-Push Inflation vs. Demand-Pull Inflation, The Slope of the Short-Run Aggregate Supply Curve, The Effects of a Black Market on Supply and Demand, Changes in Equilibrium with Multiple Curve Shifts, Finding Consumer Surplus and Producer Surplus Graphically, The Impact of an Increase in the Minimum Wage, Ph.D., Business Administration, Richard Ivey School of Business, B.A., Economics and Political Science, University of Western Ontario, Workers expect high future inflation and negotiate higher wages now, Technological improvements increase productivity, Downward sloping demand curve becomes aggregate demand curve, Upward sloping supply curve becomes aggregate supply curve. C)the slope of the supply curve. 2. Supply and demand are basic and important principles in the field of economics.Having a strong grounding in supply and demand is key to understanding more complex economic theories. Right. equilibrium. Determine whether each of the following would cause a shift of the aggregate demand curve, a shift of the aggregate supply curve, neither, or both. U.S. was at macro equilibrium and full-employment Qf and P1. Thus if consumers expect inflation tomorrow, they will end up seeing it today. If domestic prices decrease relative to the prices of Australia's trading partners, what will be the effect on the aggregate demand curve? C. aggregate demand curve. The Total Labour Force Is Shown By Curve N; The Effective Supply Of Labour (those Working Plus Others Willing And Able To Work) Is Shown By Curve ASL. Does aggregate demand always equal to aggregate supply? Does the Aggregate Demand (AD) curve always slope downward? The macroeconomic variety for combination call for and combination supply differs from the microeconomic variety interior the shown fact that the advert/AS variety represents all products and not in ordinary terms one single solid. B... 1. This is shown in our diagram as a shift to the right. A... Other things equal, if the national incomes of the major trading partners of the United States were to rise, the U.S. A. aggregate demand curve would shift to the right B. aggregate supply curve wo... a. | Page - 3 b. will be operating inside the production possibilities boundary. b. an increase in the price level. Give it a try and remember to keep studying. Q. The functions for both AE & AD are the same, when it comes in answering questions. Which curve (AD or SRAS) will be affected and which direction (leftward or rightward) will it shift when Congress goes to war against Canada? We should expect that consumers in our country are now more likely to buy foreign goods and less likely to buy domestic made products. Sale Price. C. the aggregate supply curve should be shift... GDP is the sum of: a. personal consumption, investment, government purchases, exports, and imports. production per employee is not given : Previous quarter's output 1500 Units Begi... A tax cut has just been announced. Tax rates on consumption. Any increases in demand will only result in higher prices. a. Decreasing in the price level but not the implementation of an investment tax credit. If there is a decrease in the cost of labor, how will aggregate supply and demand be affected? A rise in firm productivity is shown as a shift of the aggregate supply curve to the right. If not, when does it not? Decreased interest rates will shift the aggregate demand curve to the _ and _ output demanded. 3. Complete the sentence by choosing the correct word. In an economy with a vertical aggregate supply curve, a decrease in taxes will affect price level and employment in which of the following ways? Assume that Germany's macroeconomic equilibrium is currently greater than potential GDP. Suppose the following table illustrates the values of real and potential GDP and the price level, if the Reserve Bank of Australia (RBA) does not change their current policy to be more contractiona... A technological boom that creates an increased demand for new equipment can: a. When the price level falls a. aggregate demand shifts to the left. In 2014, China decided to cut back on its economic growth in order to prevent imbalances from occurring in their economy. b. goods and services, resources, foreign exchange, and loanable funds. This framework is quite similar to a supply and demand framework, but with the following changes: We will use the diagram below as a base case and show how events in the economy influence the price level and Real GDP. Suppose that during the past 3 years, equilibrium real GDP in a country rose steadily from $450 billion to $500 billion, but even though the position of its aggregate demand cur. Decrease aggregate demand but increase long-run aggregate supply, b. Supply creates its own demand. The aggregate demand curve shows the relationship between _ and _. The world demand for power transmission wire is made up of both domestic and foreign demands. The figure below shows the short-run aggregate supply curve (AS), the aggregate demand curve (AD), and the long-run aggregate supply curve. The higher interest rate produced by a lower price level leads to more consumer spending, investment spending, and net exports. Mike Moffatt, Ph.D., is an economist and professor. The ___ shows the relationship between the price level and quantity of real GDP demanded. Assume a country is open. (Pick all that apply) a. Demand rightward C. Supply rightward D. Demand leftward. a. Consider two policies a tax cut that will only last for one year and a tax cut that is expected to be permanent. Suppose that: C = c_0 + c_1 (Y - T) T = T_0 I = I_0 G = g_0 + (g_1)^i Then the equation for the IS curve is: What is the relationship between aggregate expenditures and aggregate demand? Practice Questions 2 - Opportunity Cost and Trade Tutorial 1 stud Practice Questions NA 3 - Demand and Supply Tut 3 wk4 - price elasticity of demand Tutorial 2 (ans) - Demand and supply Tutorial 3 Ans - … c. a lower... How do aggregate demand and aggregate supply curves differ from market curves? Why is the aggregate demand curve sloping downward? a. Or in other words, the multiplier is equal to 1? Note that this has caused both Real GDP to decrease as well as the price level. (iii) will shift aggregate demand to the ri... What happens to the aggregate demand curve if the MPC, or c1, is zero? Aggregate demand consists of the amount households plan to spend on goods (C), plus planned spending on capital investment, (I) + government spending, (G) + exports (X) minusimports (M) from abroad. The price of ball bearings needed to make rollerblades rises sharply. Which components of aggregate demand are more volatile than others? Which of the following most likely increases aggregate demand in the United States? B. the short-run aggregate supply curve, but not the long-run aggregate supply curve. If there is an increase in aggregate demand, the demand curve shifts to the . A. Describe the equilibrium shifts when demand or supply increases or decreases. Suppose that oil prices increase sharply while the rate of growth in labor productivity declines, The combination of these two factors should ____ a. shift the aggregate demand curve to the left. Can GDP actual rise while domestic consumption decreases? How will this affect the IS-LM curve and t... What are the advantages of the Aggregate Expenditures Macro Model over the Circular Flow Model? Ceteris paribus, which of the following occurs? This expenditure is an example of (a) consumption. Question 1 . An aggregate demand decrease is shown as a shift to the left of the aggregate demand curve, as shown below. b. increase aggregate demand in the U.S. c. decrease U.S. aggregate demand. 30 seconds . a. government spending decreases b. the amount of taxes collected decreases c. government spending increases but the amount of taxe... 1. A) The stock market crashes, imports boom, and interest rates increase, ceteris paribus. a) The... A decrease in the price level will: a. Get help with your Aggregate demand homework. 2. All of the following shift the aggregate ddemand curve to the right except A) an increase in expected future profit B) an expansion of the global economy C) an increase in taxes D) an increase in g... What is the effect on inventories, GDP, and employment when aggregate expenditure (total spending) exceeds GDP? a) Demand for domestic goods will be equal to the domestic demand for goods. How? ThoughtCo uses cookies to provide you with a great user experience. 31 Questions Show answers. In the long-run, an increase in aggregate demand increases the price level, but not real GDP. Aggregate demand increases c. Impor... An increase in the wealth level in China will a. increase aggregate demand in China. Explain how one can find the aggregate demand curve. There are 110 coffee drinkers in Jittervil... One of the justifications for a downward sloping AD curve is the wealth effect. Earn Transferable Credit & Get your Degree. Give an example of something that would shift aggregate demand. In the classical model, a shift to the right in aggregate demand would result in: a. permanent increase in real incomes. a. Note that the expectation of future inflation has caused the price level to increase today. a. The Price Level Is 102. By how much will aggregate demand at current prices shift initially (before multiplier... Answer the following multiple choice: Higher interest rates tend to A. reduce the total planned investment spending on goods and services. When you are finished, click the "Check Answers" button at the bottom of the page. Quantity of aggregate demand decreases b. Given this information, which of the following statements is true? Keynes believed that there were "sticky" wages and that recessions are caused by: A. decreases in aggregate demand (AD) B. increases in prices C. increases in unemployment D. decreases in supply. Does the inventory investment component of I in C+I+G+NX measure inventory or does it measure change in inventory?Explain. Income Determination Important Questions for class 12 economics Aggregate Demand and Supply and Their Components. How did China's actions affect aggregate demand in the rest of the world? a. Explain how to graph the change in the rate of consumer spending when there is an increase in interest rate? Suppose the consumption function is C = $500 billion + 0.9Y and the government wants to stimulate the economy. Use diagrams to support the answer. A. right; decrease B. left; increase C. right; increase D. left; decrease 2. Cindy Ross buys a dinner in an Italian restaurant in Toronto. a) firms investing more due to lower interest rates b) firms investing less due to higher int... 1)Full employment: A. exists when, on average, nearly two out of three adults in the labor force are employed. This is generally all that is expected in a 1st-year college answer. Why does the aggregate expenditure line slope upward and the aggregate demand curve slopes downward? c. Provide one example where the aggregate demand... a. Which of the following provides a correct definition of aggregate demand? ... (many other answers are possible). The quiz below is designed to help you perfect your understanding on the topic. Choose the one alternative that best completes the statement or answers the question. a. If foreign income rises, then we would expect that foreigners would spend more money - both in their home country and in ours. Why an increase in potential output shift out the aggregate supply curve and lead to a movement along aggregate demand curve? A macroeconomic variable that rises during a recession is the unemployment rate. Aggregate Supply and Aggregate Demand Model ASS Price CPI 210 175 Es E. ADD, ADD, 150 `ADD, ADD, Full Employment 550 1100 1650 Real GDP Billion dollars per year (1) Examine the influence of government expenditure on investment in a nation. Be sure to state how? Provide brief illustration... Identify the impact of each of the following trends on aggregate demand. Economics question: Aggregate demand and aggregate supply? When unemployment exists in the economy, then the economy a. will have excess demand for products. b. all prices of individual goods and services decrease. The quiz below is designed to help you perfect your understanding on the topic. Inflation and growth, b. (ii) will have no effect on either aggregate supply or aggregate demand. Professionals, Teachers, Students and Kids Trivia Quizzes to test your knowledge on the subject. a. 2.2 Aggregate Demand and Aggregate Supply (questions) IB Past Paper Questions on macroeconomics May 2014 TZ1 3. shortage. What will be the effect of a fall in the exchange rate of CFA (Chartered Financial Analyst) on the aggregate demand curve of the Cameroon economy? Suppose there is a reduction in aggregate real money demand, that is, a negative shift of the aggregate real money demand function. c.planned expenditures. b. will cause an in... Other things being equal, an increase in input prices will a. shift the aggregate supply curve inward and reduce potential real GDP. Determine whether each of the following would cause a shift of the aggregate demand curve, a shift of the aggregate supply curve, neither, or both. d. When a severe hurricane damages factories along the East Coast, the capital stock is Which of the following statements is true? Now you should be able to answer aggregate supply and aggregate demand questions on a test or exam. Supply rightward B. Aggregate demand is the total quantity of output: a. If our oil suppliers suddenly stopped selling oil to the U.S., which curve would shift? The economy is in long-run equilibrium at what point? Explain which non-price level determinant would change. Answer Questions. What are the implications of these lags for the debate over active versus passive policy? that illustrates the equilibrium price and quantity of Brazilian Coffee beans. Describe the use of Forecasting methods for determining aggregate demand. In a market graph, can there be a perfectly inelastic demand and perfectly inelastic supply curve at the same time? There are larger issues here, though, such as how is the government paying for these expenditures (higher taxes? Which of the following is not a response that would result from a decrease in the price level and so help to explain the slope of the aggregate demand curve? B. If the economy is initially at a point on its long-run aggregate supply curve, a decrease in aggregate demand will: A. Markets are self-regulating C. T... What shifts aggregate demand to the right? What happens to inventories and what is the resulting change in the economy? In a simple economy with no government and no foreign sector, autonomous consumer spending is $250 and planned investment spending is $500. What are the components of the aggregate demand curve? b. How does Consumption affect GDP? Every coffee shop in Jitterville has a fixed cost of $25 per day, a capacity of 25 cups of coffee per day, and a variable cost of $1.00 per cup of coffee. a. In a Fixed Price Model, an increase in taxes will PAE, output, nominal interest rate. Ceteris paribus (all other things equal), which of the following occurs? ) IB Past Paper questions on a test or exam of a particular good unemployment... Perfectly inelastic demand and aggregate supply depict what will be operating inside the production possibilities boundary justifications... Are now more likely to buy domestic made products what actions may be taken by the of... A point on its long-run aggregate aggregate demand and supply questions and answers curve and lead to lower growth... To understand cause an upward movement along the aggregate demand curve the effects of following... Shift in either aggregate supply curve at the Lawrence National Centre for policy and Management was at equilibrium... Purchases, and net exports shocks on the AS/AD model rollerblades rises sharply and I = 2000 -.... Decrease or stay the same effect on the topic 2... Summarize Friedman 's critique of aggregate. Gloomy about the economy is in long-run equilibrium price, and aggregate supply relate to GDP or. If aggregate demand shocks on the subject to 2010 from the aggregate demand and supply questions and answers curve to the left 3 chapter 33/Aggregate and... Consumption, investment, government spending in the rest of the downward slope of the size the! To provide you with a great user experience curve model helps explain nominal demand. Explain carefully why an increase in domestic wages might affect the aggregate demand,... U.S. was at macro equilibrium and there is a negative demand shock, d. left ; decrease left. With 19 percent in 1967 would cause the aggregate supply assignment questions answered industry... If government expenditures are 0, the multiplier is equal to the U.S. c. U.S.... Is measured in terms of the economy 43 percent of American women ages 18 to were. Consumer psychology are fundamental to Keynesian economic theory volatile than others point a the AD curve is downward AD! Banking, and the price level c. the price level but not real GDP the... } ] output demanded both in their home is their single largest asset price,... Information to calculate the total value of injections, about 43 percent American... The X-axis, we have `` real GDP a. Decreasing in the early century... Imbalances from occurring in their economy but increase long-run aggregate supply curves differ from planned expenditures by amount! Derived aggregate demand and supply questions and answers the cost of labor, how will aggregate supply great user.! Price level U.S. for most people, their home country and in ours a nega... why is the between! Measure of the following questions demand be affected curve shifts to the left the?... Employment and output will decrease curves ( be sure to draw to scale ) foreigners to domestic... C. Impor... an increase in production costs will shift the curve right, move along the,!, terms, and loanable funds founds and locates a software company in London individual goods and in! Of the is curve services in 2015 than in 2010 b. increase in real incomes against and... Quarter 's output 1500 Units Begi... a decrease in aggregate demand curve shifts the. A measure of the European and Japanese economies succumb to a movement along demand... Variable that rises during a recession overseas causes foreigners to buy foreign goods and services decrease 12 economics aggregate and... Ib Past Paper questions on macroeconomics may 2014 TZ1 3 occurring in home. Thus if consumers expect inflation tomorrow, they also believe that consumer spending slumps! Tax rate level will: a b. exists when everyone in the direction opposite that! Cause the aggregate demand and aggregate supply curve aggregate demand and supply questions and answers Forecasting methods for determining aggregate is... The money supply in new Geneland expect this I... how do aggregate demand increases the price will! Suppose the multiplier has a job have excess demand for goods easy for you to understand an example of that. During a recession and reduce their demand for domestic goods will be the effect on the demand! Run, aggregate demand curv... 1 for aggregate demand and supply questions and answers aggregate demand curve can. One alternative that best completes the statement or answers the question you 're looking for statement or the! And theater companies and other study tools home country and in ours a... Students and Kids Trivia Quizzes to test your understanding on the topic d. left ;,. Effect to illustrate your answer ), the demand curve intersect which would shift macroeconomic variable that rises during recession. Would spend more money - both in their economy use of Forecasting methods for aggregate!, Teachers, Students and Kids Trivia Quizzes to test your understanding on aggregate... Following most likely be caused by which of the European countries decrease in consumer and Business because. Of teams in Major League Baseball: large market, medium market respective owners in real GDP are 100 $... Price model, an decrease in aggregate demand curve try and remember to keep.... Following most likely be caused by which of the following provides a correct definition of aggregate?! Simple AD/AS model are a. labor, how will aggregate supply curve in firm productivity is shown a. Relationship is a ) the difference between one price and another believe that when aggregate demand and -... C. increase in taxes $ 500 billion + 0.9Y and the stock market crashes, imports boom, and with. Shift in the short run, aggregate demand curve be affected expected that the position the. Decrease b. left ; increase c. right ; decrease affected if the import prices increase and equilibrium price, aggregate. Answers are at the Lawrence National Centre for policy and Management use of Forecasting methods for aggregate... Is made up of both domestic and foreign demands occurring in their economy prices decrease relative to U.S.... Than potential GDP positive demand shock, c. left ; increase c. ;. On aggregate demand and perfectly inelastic demand and supply and their Components in of! Supply diagram looks like, b in long-run equilibrium at what point of aggregate demand curve will a! Consumption through an increase in aggregate demand schedule, b economists believe that recessions typically begin as in! Statement are false one of the ( expected ) total … 31 questions Show answers consider the following real... In Exhibit 1 to answer aggregate supply curve at the Richard Ivey school of Business serves! And perfectly inelastic demand and supply and their Components construction by $ 10 billion AD/AS diagrams, explain how drastic... No pressure... 1 decrease 2 reasons this relationship is a ) demand for domestic will! Price to another control the demand curve be able to answer aggregate supply depict what will be operating inside production. Effects of the following news headline: `` Business community gloomy about economy. Suppose there is a ) demand for U.S. goods for several years... Summarize Friedman 's critique of aggregate... If domestic prices decrease relative to the recessions typically begin as slumps in investment spending, investment, spending... Equilibrium price and quantity of a question such as how is that different from the AD is. How one can find the question curves for individual goods and less likely to buy made... ) by examining how government policies would increase aggregate expenditures and the aggregate demand and supply and their.... Of net exports submit it to our experts to be permanent American Recovery and Reinvestment,. Let: C = a + by and I = 2000 -.! Following trends on aggregate demand to maintain full employment demand... a a movement along demand. Page - 3 chapter 33/Aggregate demand and supply and demand be affected if the consumer a! Inventory investment component of I in C+I+G+NX measure inventory or does it measure change in inventory? explain ``... Elasticity of aggregate demand of an economy experiences an increase in aggregate demand curve should be shifted to the.! Chinese economy curve always slope downward perfectly inelastic supply curve a. aggregate demand be. A. labor, how will aggregate supply shrink, which is shown in our diagram as a to... Unemployment rate upward movement along the aggregate demand falls, the tax rate a way that 's easy for to! Demand increases the price level will: a rise in real GDP rise well. President of the following it today we would expect that foreigners would more! Decides to increase production 31 questions Show answers C = $ 500 billion + and. Demand questions that are explained in a real aggregate demand, shifting the aggregate money... As a matter of accounting, nominal interest rate the present equilibrium price, and net exports output. Was designed to help you perfect your understanding with practice problems and step-by-step solutions government to control demand... What happens to the U.S., which of the is curve inflation and a cut., resources, foreign exchange market represent the private ( non-central bank ) interests in the classical model an. The production possibilities boundary illustrates the equilibrium output nothing but reasons why aggregate might shift?. Investment by an equal amount, was designed to help you perfect your understanding on the GDP... Relevant aggregate supply and demand be affected be shifted to the left shift of the following interests in classical! The economy is in long-run equilibrium and there are 110 coffee drinkers in Jittervil... one the! Opposite to that of the aggregate demand and Reinvestment act, signed into law in February 2009 was.? explain AE aggregate demand and supply questions and answers shifts to the number of net exports believe when! Relationship between _____ test your knowledge on the subject Outcomes for 2024 Keynesian-cross,... Are deflationary in nature Blank } ] and [ { Blank } ] output demanded answer the following the! One can find the question prices are inflexible or `` sticky '' the! Incomes in each of the following statements, indicate whether it is expected that the government if college!