Question

1.Changes in the marginal rates of taxation is

a.supply change b.included change c.an autonomous change d.discretionary change

2.From the list below, choose ONE answer that best describes what would occur INITIALLY in the following AD (aggregate demand) AS (aggregate supply)"situation(s). Throughout the economy, wage agreements are including large cost of living adjustments.   a.Move to the left (up) along the AD curve   b.Move to the right (up) along the AS curve   c.Shift to the left of the AS curve   d.Move to the left (down) along the AS curve   f.Shift to the right of the AD curve   g.Move to the right (down) along the AD curve   h.Shift to the left of the AD curve   i.Shift to the right of the AS curve

3.From the list below, choose the answer(s) that best describes what would occur in the following AD (aggregate demand) AS (aggregate supply)"situation(s). The domestic price level rises causing Canadian goods to become relatively more expensive, leading Canadians to increase their purchases of foreign goods.   a.Move to the right (up) along the AS curve   b.Shift to the right of the AD curve   c.Shift to the left of the AS curve d.Move to the right (down) along the AD curve   e.Move to the left (down) along the AS curve   f.Shift to the left of the AD curve   g.Move to the left (up) along the AD curve   h.Shift to the right of the AS curve

4.From the list below, choose ONE answer that best describes what would occur INITIALLY in the following AD (aggregate demand) AS (aggregate supply)"situation(s). As a result of new and better technology, higher resource productivity occurs.   a.Move to the left (up) along the AD curve   b.Move to the left (down) along the AS curve   c.Shift to the left of the AS curve d.Shift to the right of the AD curve e.Move to the right (up) along the AS curve   f.Move to the right (down) along the AD curve   g.Shift to the right of the AS curve   h.Shift to the left of the AD curve

5.A large increase in interest rates leads to decreases in capital spending. From the list below, choose ONE answer that best describes what would occur INITIALLY in the following AD (aggregate demand) AS (aggregate supply)"situation(s).   a.Shift to the right of the AS curve   b.Shift to the left of the AD curve   c.Shift to the right of the AD curve   d.Move to the left (up) along the AD curve   e.Move to the right (up) along the AS curve   f.Move to the left (down) along the AS curve   g.Shift to the left of the AS curve   h.Move to the right (down) along the AD curve

6.From the list below, choose ONE answer that best describes what would occur INITIALLY in the following AD (aggregate demand) AS (aggregate supply)" situation(s). A large fall in interest rates stimulates capital spending.    a.Shift to the right of the AD curve   b.Move to the right (down) along the AD curve   c.Shift to the left of the AD curve   d.Shift to the left of the AS curve   e.Move to the right (up) along the AS curve   f.Shift to the right of the AS curve   g.Move to the left (up) along the AD curve   h.Move to the left (down) along the AS curve

Answer 1

1. Supply Change. Changes in the marginal rate of taxation is a supply change becayse it impacts the cost of production in the economy.

2, Option c. When wage agreements include large cost of living adjustments in the economy then overall cost of production increases in the economy which will shift the aggregate supply curve leftwards.

3. Option f. As foreign goods become less expensive, the total imports of the nation will increase which will reduce the level of Net exports and this will shift the aggregate demand curve of the economy leftwards.

4. Option g. New and better technology will shift increase productivity and increase output produced at all price level shifting the aggregate supply curve rightwards.