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17 Cards in this Set

  • Front
  • Back
Which of the following statements is correct?
The lower the price level, the greater the quantity of real GDP demanded
The aggregate supply curve illustrates that the
higher the price level, the greater the quantity of real GDP supplied.
According to the AS-AD model
the equilibrium is where the SRAS curve crosses the AD curve but the amount of real GDP at this point is not always equal to potential GDP.
An increase in government expenditures on goods and services leads to the
aggregate demand curve shifting rightward.
f people's expectations about future income improve so they think their future income will be higher than previously believed, then the AD curve
will shift rightward because people will increase spending now.
The long-run aggregate supply curve illustrates
a country's potental real GDP.
A rise in the price level
decreases the quantity of real GDP demanded.
Which of the following would not cause an increase the LRAS?
a decrease in the labor force
If government expenditure on goods and services increases by $20 billion, then aggregate demand function
increases by more than $20 billion.
The national debt is
the sum of past budget deficits minus the sum of past budget surpluses.
A tax policy where tax rates decrease when income increases is called
regressive taxation.
A tax policy where tax rates increase when income increases is called
progressive taxation.
If the federal government has a budget deficit, then it is definitely the case that
government outlays exceed revenues.
The gross national debt is
the sum of debt owed to entities outside of the federal government and intra-governmental holdings.
According to the Laffer Curve,
decreasing tax rates may or may not cause tax revenue to decrease.
All of the following could be automatic stabalizers except
a tax increase to reduce the deficit.
A tax policy where tax rates stay the same when income increases is called

flat taxation