ECO 203 Week 3 Quiz | Assignment Help | Ashford University
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- 15 Oct 2020
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ECO 203 Week 3 Quiz | Assignment Help | Ashford University
Week 3 – Quiz
Question 1
According to classical
economists, the proper macroeconomic role of government is __________.
o
to regulate GDP
o
to control the money supply
o
to control unemployment
o
to set prices
Question 2
In the Keynesian model,
at the equilibrium level of income, which one of the following statements is
NOT true?
o
Planned spending equals actual output.
o
The economy is at full employment.
o
There are no unplanned inventory
changes.
o
There is no tendency for the output
level to change.
Question 3
The marginal propensity
to save (MPS) represents __________.
o
the slope of the saving function
o
the slope of the consumption function
o
total saving divided by total income
o
total consumption divided by total
saving
Question 4
According to the
authors, the lesson learned from Spain’s massive deficit during a 2012
recession was that debt reduction during an economic crisis will most likely
__________.
o
deter economic growth
o
result in reduced taxes
o
produce inflation
o
encourage government spending
Question 5
According to the
Keynesian view, why are voluntary changes in spending by the private sector NOT
a reliable source of changes in aggregate expenditure?
o
because the theory of private sector
spending is the weakest part of Keynesian theory
o
because what the private sector does in
an economy is not factored into aggregate expenditure
o
because neither households nor
businesses can be expected to act in the interest of society if such action
conflicts with their self-interest
o
because the self-interested behavior of
the private sector causes spending to increase during recessions and decrease
during inflationary times
Question 6
Adding the foreign
sector to the Keynesian model __________.
o
adds another injection only
o
adds another leakage only
o
increases income and output if net
exports are negative
o
increases income and output if net
exports are positive
Question 7
Say’s law states that
supply creates its own demand because __________.
o
prices tell producers exactly how much
to produce in the short run
o
production creates income sufficient to
purchase all that is produced
o
there is always a buyer for every good
purchased
o
supply prices are always equal to demand
prices
Question 8
Regarding their
national financial situations, what have Iceland and Argentina had in common?
o
Both nations have been bankrupt due to
the number of their failed banks.
o
Both nations have been bankrupt due to
their inability to repay foreign loans.
o
Neither nation has ever had national
deficits.
o
Neither nation has ever had to take
foreign loans.
Question 9
A decrease in net
exports of soybeans would cause the AE curve to __________.
o
curve upward
o
curve downward
o
become vertical
o
remain unchanged
Question 10
The consumption
function shows the relationship between the income received by households and
__________.
o
the amount they plan to spend on
currently produced final output
o
the amount they plan to save You
Answered
o
the amount households and business firms
plan to spend on investment
o
the taxes paid on personal income