It\'s extremely imperative I get the correct answer on these questions, which wi

Question

It's extremely imperative I get the correct answer on these questions, which will help me learn the material for an upcoming exam. Please try to answer these questions correctly!

1. If autonomous investment increases by 100 and government purchases decrease by 100, which of the following is true?

a. Income will increase by 100
b. Income will increase by 200
c. Income will increase by the multiplier times 100
d. Income will decrease by the multiplier times 100
e. Income will not change

2. Based on the national income identity, S-I = BD, which of the following is likely to happen if there is an increase in the budget surplus.?

a. Imports will increase more than exports
b. Exports will increase more than imports
c. Private domestic saving will increase more than private domestic investment
d. Private domestic investment will remain the same while private domestic saving will increase
e. Private domestic investment will decrease

3. While the Fed can influence the money stock, the ratio of currency to deposits in the country at any given time is determined

a. By the Treasury
b. Jointly by the Treasury and the Fed
c. Only by lending institutions which provide banking services
d. Only by the actions of the Treasury Department
e. By the public, as households and businesses hold money in the form they prefer

4. The unemployment rate is most likely to decrease if
a. The number of people who are out of work but expecting to be recalled from a layoff increases

b. The number of people living in the country increases
c. The labor force decreases more than the overall population
d. More people who are currently out of work decide to give up looking for a job
e. None of the above

5. Expansionary monetary policy will increase nominal GDP
a. In the Keynesian case
b. In the classical case
c. In the medium run
d. Only A and C

Explanation / Answer

1.a. Income will increase by 100 Govt investment is synonymous with taxes, so get extra 100 2.b. Exports will increase more than imports more budget surplus means more foreign exchange 3.c. Only by lending institutions which provide banking services FACT 4.b. The number of people living in the country increases FACT 5.b. In the classical case i found this answer on google (its correct) PLEASE RATE

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