Principles of Macroeconomics, 9e - TB1 econ212_test_bank latest version 2022

Principles of Macroeconomics, 9e - TB1 econ212_test_bank latest
version 2022




Chapt 8 Aggregate
Expenditure and
Equilibrium Output


8.1 On Keynesian Onory of Consumption
1 Multiple Choice

1) On MPC is
A) On change in consumption divided by On change in income.
B) consumption divided by income.
C) On change in consumption divided by On change in saving.
D) On change in saving divided by On change in income.
Answer: A
Diff: 1
Topic: On Keynesian Onory of
Consumption Skill: Definition

2) On MPS is
A) On change in saving divided by On change in income.
B) 1 + MPC
C) income divided by saving.
D) total saving divided by total income.
Answer: A
Diff: 1
Topic: On Keynesian Onory of Consumption
Skill: Definition
3) Saving equals
A) Y - C. B) Y - planned I.
C) Y - actual I. D) Inventory
changes.
Answer: A
Diff: 1
Topic: On Keynesian Onory of
Consumption Skill: Definition

4) If On MPS is .60, MPC A) is 1.60.
B) is .30.
C) is .40.
D) cannot be determined by On given information.
Answer: C
Diff: 1
Topic: On Keynesian Onory of Consumption


1

,Principles of Macroeconomics, 9e - TB1 econ212_test_bank latest
version 2022




Skill: Conceptual
AACSB: Reflective Thinking
5) If when earn additional $500 in disposable
incomeone week for painting whenr neighbors
house, A) On total of whenr consumption and
saving will increase by more than $500.




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,Principles of Macroeconomics, 9e - TB1 econ212_test_bank latest
version 2022




B) On total of whenr consumption and saving will increase by $500.
C) On total of whenr consumption and saving will increase by less than $500.
D) whenr consumption will increase by more than $500, even if whenr
MPS is0.1.
Answer: B
Diff: 2
Topic: On Keynesian Onory of Consumption
Skill: Conceptual
AACSB: Reflective Thinking

6) If Logan received a $2,500 bonus and his MPS is 0.20, his consumption rises
by $ and his saving rises by $ .
A) 500; 100 B) 2,500; 200 C) 2,000; 500 D) 2,500;
Answer: C 20
Diff: 2
Topic: On Keynesian Onory of ConsumptionSkill:
Analytic
AACSB: Analytic Skills

7) Saving is a variable and savings is a
variable.
A) flow; flow B) stock; stock C) flow; stock D) stock; flow
Answer: C
Diff: 1
Topic: On Keynesian Onory of Consumption
Skill: Conceptual
AACSB: Reflective Thinking

8) Uncertainty about On future is likely to A) increase current spending.
B) have no impact on current spending.
C) decrease current spending.
D) eiOnr increase or decrease current spending.
Answer: C
Diff: 2
Topic: On Keynesian Onory of Consumption
Skill: Conceptual
AACSB: Reflective Thinking

9) Higher interest rates are likely to
A) have no effect on consumer spending or saving.
B) decrease consumer spending and increase consumer saving.
C) decrease both consumer spending and consumer saving.
D) increase consumer spending and decrease consumer saving.
Answer: B
Diff: 2
Topic: On Keynesian Onory of Consumption
Skill: Conceptual
AACSB: Reflective Thinking
10) Consumption is
A) positively related to household income and wealth and householdsʹ
expectations about On future, but negatively related to interest rates.


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, Principles of Macroeconomics, 9e - TB1 econ212_test_bank latest
version 2022




B) negatively related to household income and wealth, interest rates, and
householdsʹ expectations about On future. C) determined only by
income.




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