Home→ Economics Mcqs → Macroeconomic Policy Tools →When an increase in government purchases increases the income of some people, and those people spend some of that increase in income on additional consumer goods, we have seen a demonstration of ?

Which of the following is an automatic stabilizer ?
Suppose the government increases its purchases by Rs16 billion. If the multiplier effect exceeds the crowding out effect, then ?
When an increase in government purchases raises incomes shifts money demand to the right raises the interest rate, and lowers investment we have seen a demonstration of ?
An increase in the marginal propensity to consumer (MPC) ?
The initial impact of an increase in government spending is to shift ?
The initial effect of an increase in the money supply is to ?
For the Eurozone countries, the most important source of the downward slope of the aggregate demand curve is probably ?
When money demand is expressed in a graph with the interest rate on the vertical axis and the quantity of money on the horizontal axis an increase in the interest rate ?
Which of the following best describes how an increase in the money supply shift the aggregate demand curve ?
Which of the following statements about stabilization policy is not true ?
Which of the following statements regarding taxes is correct ?
Suppose a wave of investor and consumer optimisms has increased spending so that the current level of input exceeds the long-run natural rate If policy makers choose to engage in activist stabilization policy they should ?
If the marginal propensity of consume MPC is 0.75 the value of the multiplier is ?
Suppose a wave of investor and consumer pessimism in the USA causes a reduction in spending If the US federal Reserve (Which has a broader remit than the Bank of England Which is charged only with controlling inflation) chooses to engage in activist stabilization policy it should ?
In the market for real output, the initial effect of an increase in the money supply is to ?
When supply and demand for money are expressed in a graph with the interest rate on the vertical axis and the quantity of money on the horizontal axis an increase in the price level ?
Keynes liquidity preference theory of the interest rate suggests that the interest rate is determined by ?

When an increase in government purchases increases the income of some people, and those people spend some of that increase in income on additional consumer goods, we have seen a demonstration of ?

A. The multiplier effects
B. supply side economics
C. None of these answers
D. The crowding out effect

Correct Answer: The multiplier effects ✔

Last Updated: June 18, 2019