2 nd Seating Chart 3 (Front of Class) RachaelScottShelby Smith Paperw. HannahZach P.Heather Zach S. Bathroom JoshuaDavidWilliamJuhiAmanda Attendanc Shelby Stephens EmilyGarrett Boss AddieDanielle windowwindow

Seating Chart 4th (Front of Class) RachaelSierra Attndnc. SarahCoraCharlesKristen Brandon Bathroom RyanAnmolKyleJordanWill Boss Andrew CierraDylanCourtney J. MaciHunterGabrielleAlex H. Tanner Paperw. HannahAlex B.EmmaCody G. BrettAdamCliffMichael D. NicoleDanielle J.Cody J.Michael E. windowwindow

Why AD slopes downward.

AD Handout Review

Group Competition

2 nd Seating Chart 3 (Front of Class) RachaelScottShelby Smith Paperw. HannahZach P.Heather Zach S. Bathroom JoshuaDavidWilliamJuhiAmanda Attendanc Shelby Stephens EmilyGarrett Boss AddieDanielle windowwindow

Seating Chart 4th (Front of Class) RachaelSierra Attndnc. SarahCoraCharlesKristen Brandon Bathroom RyanAnmolKyleJordanWill Boss Andrew CierraDylanCourtney J. MaciHunterGabrielleAlex H. Tanner Paperw. HannahAlex B.EmmaCody G. BrettAdamCliffMichael D. NicoleDanielle J.Cody J.Michael E. windowwindow

Profit expectations on investment projects rise A) Move Along B) Increase/Shift Right C) Decrease/Shift Left

Profit expectations on investment projects rise A) C B) I C) G D) (X-M)

Income tax rates rise A) Move Along B) Increase/Shift Right C) Decrease/Shift Left

Income tax rates rise A) C B) I C) G D) (X-M)

Government increases public works spending A) Move Along B) Increase/Shift Right C) Decrease/Shift Left

Government increases public works spending A) C B) I C) G D) (X-M)

The CPI falls A) Move Along B) Increase/Shift Right C) Decrease/Shift Left

The U.S. sells more Florida orange juice to Canada A) Move Along B) Increase/Shift Right C) Decrease/Shift Left

The U.S. sells more Florida orange juice to Canada A) C B) I C) G D) (X-M)

Consumers become more confident about the future of the economy A) Move Along B) Increase/Shift Right C) Decrease/Shift Left

Consumers become more confident about the future of the economy A) C B) I C) G D) (X-M)

Consumers expect prices to rise next month A) Move Along B) Increase/Shift Right C) Decrease/Shift Left

Consumers expect prices to rise next month A) C B) I C) G D) (X-M)

Stock market indexes rise (stock prices rise, on average) A) Move Along B) Increase/Shift Right C) Decrease/Shift Left

The Federal Reserve decreases the money supply A) Move Along B) Increase/Shift Right C) Decrease/Shift Left

Inflation is rising A) Move Along B) Increase/Shift Right C) Decrease/Shift Left

AD Quiz with 2 multiplier questions at the beginning (8 questions total)

If the marginal propensity to consume in an economy is.80, the government could increase GDP by $100 billion by increasing spending by (assume maximum expansionary effects): a) $10 billion b) $20 billion c) $25 billion d) $40 billion

If the government increases expenditures by $50 billion and at the same time levies a lump-sum tax of $50 billion, the net effect on the economy will be: a) to increase GDP by less than $50 billion b) to increase GDP by more than $50 billion c) to increase GDP by $50 billion d) to make no change in GDP

The interest rate effect indicates that a(n): a. decrease in the price level will increase the demand for money, increase interest rates, and decrease consumption and investment spending b. decrease in the price level will decrease the demand for money, decrease interest rates, and increase consumption and investment spending c. increase in the price level will increase the demand for money, reduce interest rates, and decrease consumption and investment spending d. increase in the supply of money will increase interest rates, and decrease interest sensitive consumption and investment spending

Aggregate demand may be measured by adding A) consumption, investment, savings, and imports B) savings, government spending, and business inventories C) consumption, investment, government spending, and net exports D) domestic private expenditures and government spending E) domestic expenditures and imports

Which of the following events would most likely decrease aggregate demand? a. an increase in government spending b. a reduction in business and personal tax rates c. an increase in investment spending d. an increase in personal income tax rates

Which of the following would be considered to be one of the factors that shift the aggregate demand curve? A change in: a. productivity b. prices of imported resources c. domestic resource availability d. profit expectation on investment projects

The interest rate and wealth effects help explain: a) why the aggregate demand curve is down sloping b) the Keynesian range of the aggregate supply curve c) the classical range of the aggregate supply curve d) why the consumption schedule remains stable when the price level changes

What is one reason the level of domestic output purchased will be higher when the price level is lower? a. the ratchet effect b. the unemployment rate c. the net export effect d. the business cycle effect

M18 Aggregate Supply

Short-run aggregate supply PL RGDP

SRAS is upward sloping because wages are ___________.

SRAS shifters Input costs – Commodities – Wages Productivity Business Taxes – Wait, aren’t taxes a demand shifter?????

SRAS shifter cold-call

AD or SRAS?? (also: increase or decrease)

SRAS Shifter Handout

Long-run aggregate supply PL RGDP

LRAS is vertical because wages are __________ in the long-run.

LRAS shifters When LRAS shifts right, this is called: What causes ec. growth? – Amount of _________ - – Quality of _________ (i.e. education) – T____________

3 Ways to Show Economic Growth PPF Business CycleLRAS

Prod costs Productivity