so. An increase in Swedish demand for Heinz ketchup from the U.S. will lead to a
ID: 1128069 • Letter: S
Question
so. An increase in Swedish demand for Heinz ketchup from the U.S. will lead to a a stronger dollar, a weaker krona and an increase in U.S. aggregate demand. b. a weaker dollar, a stronger krona and a decrease in U.S. aggregate supply. c. a weaker dollar, a weaker krona and an increase in U.S. aggregate demand. d. a stronger dollar, a weaker krona and a decrease in U.S aggregate demand. S1. if the Federal Reserve implements a policy to reduce inflation, which of the following is most likely to increase? a. Tax rates b. Investment c. Interest rates d. Government spending -52. An increase in the marginal propensity to consume causes an increase in which of the following? a. Marginal propensity to save b. Spending multiplier c. Savings rate d. Exports -53. An increase in government spending leads to a(n) a. lower price level. b. lower deficit. c. lower interest rates d. increase in aggregate demand 54, which of the following will have a positive effect on aggregate demand? a. Increase in imports. b. Increase in taxes. c. Decrease in consumer income. d. Increase in exports -55. The long-run growth of an economy will be increased by an increase in all of the following EXCEPT a. capital stock b. labor supply. c. real interest. d. spending on education and research.Explanation / Answer
Ans)
50.
a. a stronger dollar,a weaker Krona and an increase in US aggregate demand
IF the demand for US products go up by Swedish people,then they will pucrhase dollars with their currency, as a result the demand for dollars will go up and it will become stronger.Since the exports go up the aggregate demand also increases(AD=C+I+G+NX)
51.
c. Interest rates
The most common way of counteracting inflation is by using a contractionary monetary policy by increasing interest rates.
52.
b. Spending multiplier
An increase in the MPC drives up consumption per dollar hence it drives down MPS and savings.Since multiplier is 1/MPS a decrease in MPS will increase the multiplier
53.
d.increase in aggregate demand
An increase in the government spending would lead to an increase in the aggregate demand (AD=C+I+G+NX)
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