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39) An increase in the interest rate A) increases the the opportunity cost of ho

ID: 1129100 • Letter: 3

Question

39) An increase in the interest rate A) increases the the opportunity cost of holding money B) dlecreases C) increases the opportunity cost of holding money D) decreases the percentage yield of holding money 40) The formula for aggregate expenditure is C) AE C I depreciation- Nx. 41) is defined as the value of a household's assets minus the value of its liabitities B) Household …ith D) Planned household investment 41) C) Personal household consumption 42) Silver is an example of a B) barter money A) commodity money. C) fiat money. 43) The long-run aggregate supply curve A) has a negative slope. C) has a steep but positive slope. B) is vertical. D) is horizontal. Figure 11-3 Real aggregate (trillions of 2000 dollars) AE, AE, 45 GDP, Real GDP, (trillions of GDP, 2000 dollars) 44) Refer to Figure 11-3. Suppose that investment spending increases by $10 million, shifting up the4 aggregate expenditure line and GDP increases from GDP1 to GDP2. If the MPC is 0.9, then what is the change in GDP? A) $9 million B) S10 million C) $90 million D) $100 million

Explanation / Answer

Answer:- An increase in the interest rate

Correct Answer:- increases the opportunity cost of holding money.

Answer:- formula for aggregate expenditure

Correct Answer:- AE=C+I+G+NX

Answer:- ____ is defined as the value of a household's assets minus the value of its liabilities

Correct Answer:- household wealth

Answer:- silver is an example of

Correct Answer:- commodity money

Answer:- the long run aggregate supply curve

Correct Answer:- is vertical

Answer:- Suppose that investment spending increases by $10 million, shifting up the aggregate expenditure line and GDP increases from GDP1 to GDP2. If the MPC is 0.9, then what is the change in GDP?

Correct Answer:- $100 million

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