Question 1
What is meant by net export effect?
A.
Lower PL → exports more competitive, imports less attractive. B.
Total planned spending in the economy at each average price level. C.
C + I + G + (X − M). D.
Spending not determined by current income.
Question 2
Aggregate demand is:
A.
C + S + T B.
C + I + G + (X − M) C.
Exports only D.
Government spending only
Question 3
The net export effect means lower PL leads to:
A.
Higher interest rates B.
Lower consumption always C.
More competitive exports D.
Higher imports only
Question 4
What is meant by aggregate demand (ad)?
A.
Total planned spending in the economy at each average price level. B.
Spending not determined by current income. C.
Caused by a change in the average price level. D.
C + I + G + (X − M).
Question 5
What is meant by open economy ad?
A.
Interest rate set by the Bank of England for lending to banks. B.
Includes net trade component. C.
Spending not determined by current income. D.
Lower PL → exports more competitive, imports less attractive.
Question 6
What is meant by autonomous spending?
A.
Lower PL → lower interest rates → more I and C. B.
Caused by a change in the average price level. C.
Lower PL → exports more competitive, imports less attractive. D.
Spending not determined by current income.
Question 7
Movement along AD is caused by:
A.
Technology improvement B.
Immigration only C.
Higher government spending D.
A change in the average price level
Question 8
What is meant by ad formula?
A.
C + I + G + (X − M). B.
Caused by change in C, I, G, X or M at each price level. C.
Caused by a change in the average price level. D.
Includes net trade component.
Question 9
A rise in consumer confidence shifts:
A.
PPF inward B.
AD to the right C.
LRAS left D.
SRAS left only
Question 10
What is meant by movement along ad?
A.
Lower PL → exports more competitive, imports less attractive. B.
Lower PL → lower interest rates → more I and C. C.
Includes net trade component. D.
Caused by a change in the average price level.
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