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Principles of Macroeconomics

Business

Quiz 15 :

The Influence of Monetary Policy on Aggregate Demand

Quiz 15 :

The Influence of Monetary Policy on Aggregate Demand

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If expected inflation is constant and the nominal interest rate increases, how does the real interest rate change?
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Multiple Choice
Answer:

Answer:

B

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For the Canadian economy, what is the least important of the three reasons for the downward slope of the aggregate-demand curve?
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Answer:

A

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Which statement best describes the relationship among the three effects that influence the slope of the aggregate demand curve?
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Answer:

C

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Which statement does NOT accurately explain the slope of the aggregate-demand curve?
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Who first proposed the theory of liquidity preference?
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Which statement is NOT a reason the aggregate-demand curve slopes downward?
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According to the theory of liquidity preference, how is the money supply affected by the interest rate?
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According to the liquidity-preference theory, equilibrium in the money market is achieved by adjustments in which of the following?
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The wealth effect helps explain the downward slope of the aggregate-demand curve. How important is this effect and why?
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According to liquidity-preference theory, when would the money-supply curve shift right?
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What is characteristic of aggregate demand in Canada?
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Which reason for the downward slope of the aggregate demand curve would likely be more important for a small closed economy?
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The theory of liquidity preference assumes that the nominal supply of money is determined by which of the following?
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According to liquidity-preference theory, what action taken by the Bank of Canada would shift the money-supply curve?
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When the Bank of Canada buys government bonds, how do the reserves of the banking system change and what happens to the money supply?
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Which of Keynes's theories does liquidity preference refer to?
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According to liquidity-preference theory, what is the shape of the money-supply curve?
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If expected inflation is constant and the nominal interest rate increased 2 percentage points, what would happen to the real interest rate?
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According to liquidity-preference theory, in which circumstance would the money-supply curve shift left?
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Over what period of time is the liquidity-preference theory most relevant, and what does it suppose?
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