#1
Which of the following is NOT a determinant of aggregate demand?
Government spending
Consumer expectations
Foreign exchange rates
Interest rates
#2
What effect does an increase in consumer confidence have on aggregate demand?
Increases aggregate demand
Decreases aggregate demand
No effect on aggregate demand
Fluctuates aggregate demand
#3
How does an increase in exports affect aggregate demand?
Increases aggregate demand
Decreases aggregate demand
No effect on aggregate demand
Fluctuates aggregate demand
#4
Which of the following is a component of aggregate demand?
Total expenditure on imports
Total expenditure on exports
Total expenditure on investments
Total expenditure on savings
#5
If the government increases its spending while keeping taxes constant, what happens to aggregate demand?
Aggregate demand increases
Aggregate demand decreases
Aggregate demand remains unchanged
Aggregate demand fluctuates
#6
What is the multiplier effect in the context of aggregate demand?
A decrease in aggregate demand due to a decrease in consumer spending
An increase in aggregate demand due to an initial increase in spending
The tendency of consumers to save rather than spend
A decrease in government spending to stabilize the economy
#7
In the AD-AS model, what does the Aggregate Demand curve represent?
Total planned spending on final goods and services
Total production of goods and services in the economy
Total investment in capital goods
Total consumer savings
#8
Which of the following is NOT a component of consumption expenditure in aggregate demand?
Investment in stocks
Spending on durable goods
Expenditure on nondurable goods
Expenditure on services
#9
What is the relationship between the price level and aggregate demand, according to the wealth effect?
As the price level increases, aggregate demand decreases
As the price level increases, aggregate demand increases
As the price level decreases, aggregate demand decreases
As the price level decreases, aggregate demand increases
#10
How does a decrease in the value of the currency affect aggregate demand?
Increases aggregate demand
Decreases aggregate demand
No effect on aggregate demand
Fluctuates aggregate demand
#11
How does an increase in interest rates affect aggregate demand?
Increases aggregate demand
Decreases aggregate demand
No effect on aggregate demand
Fluctuates aggregate demand
#12
What is the main assumption of the aggregate demand curve?
Prices are fixed
There is full employment in the economy
Interest rates remain constant
There are no changes in government policy
#13
What is the relationship between the exchange rate and net exports in aggregate demand?
As the exchange rate increases, net exports decrease
As the exchange rate increases, net exports increase
As the exchange rate decreases, net exports decrease
As the exchange rate decreases, net exports increase
#14
What is the primary objective of monetary policy in influencing aggregate demand?
To regulate government spending
To control inflation
To encourage consumer spending
To stimulate international trade
#15
According to the Keynesian perspective, what role does aggregate demand play in economic fluctuations?
It is the primary driver of economic fluctuations
It has no significant impact on economic fluctuations
It amplifies existing fluctuations in the economy
It dampens fluctuations in the economy