aggregate demand. Aggregate supply

TEST ECONOMY (DE - MACRO)

Topic: SNA and macroeconomic indicators

1. Provided that personal consumption expenditures are reduced by 30 den. units, government spending increased by 25 den. units, gross investment increased by 15 den. units, the volume of imports increased by 10 den. units, and the volume of exports decreased by 5 den. units GDP...

will be reduced by 5 den. units

will increase by 15 den. units

will increase by 5 den. units

will be reduced by 15 den. units

Solution:

GDP is one of the main macroeconomic indicators evaluating the results of economic activity. When calculating GDP by expenditures, expenditures on final consumption of goods and services by households, the state are summed up; gross investment and net exports. An increase in the volume of each element leads to an increase in GDP. It should be noted that the “net export” indicator is equal to the difference between exports and imports, so an increase in exports leads to an increase in GDP, and an increase in imports leads to a decrease in GDP.

The total change in GDP will be: den. units

2. Personal disposable income will be _____ den. units provided that the GDP is 9300 den. units, depreciation deductions 800 den. units, transfer payments 750 den. units, indirect taxes 480 den. units, individual taxes 640 den.un., social security contributions 700 den. units

3. Personal disposable income, provided that the GDP is 10,000 den. units, depreciation deductions 700 den. units, transfer payments 1000 den. units, indirect taxes 500 den. units, individual taxes 1400 den.un., social security contributions 400 den. units, will be _____ den. units

Solution:

Course of economic theory: General foundations of economic theory. Microeconomics. Macroeconomics. Fundamentals of the national economy: textbook. allowance for university students / hands. ed. team and scientific ed. A. V. Sidorovich; Moscow State University M. V. Lomonosov. - M .: Business and Service, 2007. - S. 322-323.

4. The following data on the elements of GNI are known: wages of employees 2625 billion den. units, gross profit 3600 billion den. units, net indirect taxes 1275 billion den. units, net exports 1125 billion den. units, the balance of income from abroad -300 billion den. units This means that GNI amounted to _____ billion den. units

Solution:

GNI can be determined from these data using the income stream method: billion den. units

5. Personal disposable income will be _____ den. units provided that the GDP is 9300 den. units, depreciation deductions 800 den. units, transfer payments 750 den. units, indirect taxes 480 den. units, individual taxes 640 den.un., social security contributions 700 den. units

Solution:

Personal disposable income is calculated by subtracting depreciation, indirect taxes, individual taxes, social security contributions, income taxes, retained earnings from GDP and adding transfer payments: den. units

6. The following data on the elements of GDP are known: wages of employees 3,000 billion den. units, government spending on the purchase of goods and services 1450 billion den. units, gross private investment 1350 billion den. units, net indirect taxes 1300 billion den. units, gross profit 3150 billion den. units, consumer spending of households 3200 billion den. units, export 2200 billion den. units, imports 750 billion den. units This means that GDP, calculated using the expenditure stream method, amounted to _____ billion denier. units

Solution:

There are two ways to determine GDP from these data: 1) by the flow of expenses, billion den. units 2) by income stream billion den. units

7. Provided that the GDP is equal to 9000 den. units, depreciation deductions 1350 den. units, transfer payments 750 den. units, net exports 1050 den. units, consumer spending 3200 den. unit, net gross product (GDP) will be ____ den. units

8. If in 2009 household consumption spending was €500 billion, gross private domestic investment €250 billion, government purchases of goods €200 billion, indirect taxes €220 billion, net exports €60 billion, then nominal GDP is _________ billion euros.

Topic: Aggregate demand. Aggregate offer.

multivariate test.

1. Aggregate demand is:

Total consumer spending at a constant price level
Sum of spending on consumption and investment
The value of goods purchased by both residents of the country and non-residents
Different quantities of goods and services to be purchased at all possible average price levels

2. An increase in the average price level leads to:

Increased consumer spending and reduced investment
Increase in consumer and investment spending
Reducing consumer and investment spending
Reduce consumer spending and increase investment

3. If the average price level falls, then other things being equal:

Financial assets lose their purchasing power
Owners of financial assets may increase purchases of consumer goods due to increased wealth
The aggregate demand curve will shift to the left
Everything is wrong
That's right

4. The aggregate supply curve shows that:

Changing the average price level
With a low level of production, it is relatively difficult to increase production.
Inverse relationship between the average price level and total output
If output rises, it is relatively easy to increase production further.

5. The vertical segment of the aggregate supply curve is called:

Keynesian
Classic
intermediate
Everything is wrong
That's right

6. Keynesian segment of the aggregate supply curve:

Looks like an ascending curve
Is vertical
Is horizontal
Has a negative slope

7. If an increase in aggregate demand occurs on a vertical segment of the aggregate supply curve, then:

Real output and price level will rise
Real output and price level will fall
Real output will increase and the price level will fall
Real output will not change, but the price level will rise

8. Which of the following will cause a reduction in aggregate supply:

Rise in the price level
Falling price level
Production crisis
Decrease in s / s production

9. A reduction in aggregate supply, ceteris paribus, will cause:

Decrease in real output and increase in the price level
Decrease in real output and lower price level
Increasing real output and lowering the price level
An increase in real output and an increase in the price level

True False

The aggregate demand curve is the sum of the individual demand curves for goods and services

(Wrong)

The aggregate demand curve has a negative slope, because an increase in the average price level leads to a decrease in total costs.

(Right)

An increase in investment shifts the aggregate demand curve to the right. A decrease in the price level, ceteris paribus, will lead to an increase in the consumption of goods and services, but the aggregate demand curve will not shift.

(Right)

If the level of real output rises, then the slope of the aggregate supply curve will increase.

(Wrong)

An increase in aggregate demand is not related to the shape of the aggregate supply curve.

(Right)

Since the aggregate supply curve always has a vertical segment, therefore, any increase in aggregate demand will lead to an increase in the price level.

(Wrong)

The vertical segment of the aggregate supply curve is called the classical segment.

(Right)

An increase in aggregate demand, ceteris paribus, always leads to an increase in real output.

(Wrong)

Ceteris paribus, an increase in aggregate supply will lead to an increase in real output and a decrease in the average price level.

(Right)

Finish the sentence.

Decrease in the average price level leads to an increase in aggregate demand. Increased consumption and investment, other things being equal, always leads to an increase in aggregate demand.
The curve reflecting the relationship between total spending on goods/services and the average price level is called aggregate demand curve .
The horizontal section of the aggregate supply curve is called Keynesian line segment. Vertical cut - classical line segment.
If the aggregate supply curve is horizontal, then an increase in aggregate demand, ceteris paribus, will lead to an increase in volume of GDP (production) , a average price level Will not change.
If the aggregate supply curve is vertical, then an increase in aggregate demand will increase average price level , a GDP (production) it will not change.
If the economy is experiencing high unemployment, then the government can reduce unemployment and increase real output by applying policies that will cause the aggregate demand curve to shift. right up and the aggregate supply curve left down .
The government can reduce high inflation by applying policies that will cause the aggregate demand curve to shift left down , and the aggregate supply curve right up .

Exercises.

1. The table presents data on the aggregate demand of the economy of country A:

Plot the aggregate demand curve

Price level AS AS 1

140- AS=AD AD=AS 1

130-

120-

110-

100-

90-AD

80 -

0 40 80 120 160 200 240 280 GDP

If country A's aggregate supply curve data is:

Plot the aggregate supply curve using the same ordinates.

What is the equilibrium price level and real output.

Average price level - 110

Production volume - 160

2. Based on the previous task, suppose that total supply increased by $60 million at each average price level.

Complete the Aggregate Supply Table

Draw a new aggregate supply curve (AS 1) using the previous graphs.
Suppose demand has changed. What will be the new price level? Real production volume?

New price level - 100

Real production volume - 200

3. Using the theory of aggregate demand - aggregate supply, show graphically what effect the following events will have on the price level and output (other conditions are not changed).

The aggregate supply curve is an intermediate segment. Investment and consumption are on the rise.

P AS

AD 1

GDP

The society will increase income, price level and GDP,

The aggregate supply curve is a horizontal line. Government spending is on the rise.

The model "aggregate demand - aggregate supply" ("AD - AS") shows the relationship (like any model - ceteris paribus) between the price level (expressed, for example, through the GNP deflator) and the real national (domestic) product (gross or net ), which is bought and sold.

aggregate demand. Aggregate demand (AD) is the amount of goods and services produced in a given national economy that all consumers are willing to buy, depending on the price level. The aggregate demand curve - AD 1 has a descending form (Fig. 12-1), which means an inverse relationship between the price level and the volume of aggregate demand for national goods and services. Thus, if there is inflation in the economy, then it reduces the amount of aggregate demand for national goods and services. This dependence is similar to the law of demand. But the factors that explained the desires and capabilities of consumers in the market for a particular product do not explain the behavior of the AD curve. .

Rice. 12-1. Aggregate demand and its change

Firstly, it is impossible to achieve full satisfaction of needs in all goods and services that make up the national product: some will always be sorely lacking anyway. Second, on a macroeconomic scale, most consumers are at the same time suppliers of resources, and the increase in their spending as buyers due to rising prices simultaneously means a proportional increase in their income as sellers. The negative slope of AO is explained by several factors. On the one hand, inflation reduces the real value of those financial assets that have a fixed nominal value (cash, term deposits, bonds, bills, etc.) and induces to compensate for losses by spending less on purchases, goods and services: this is the wealth effect . Another factor that determines the shape of the AO curve, the interest rate effect, is associated with an increase in the lending rate during inflation (with the money supply unchanged), which reduces both private investment and consumer spending using credit funds. Finally, there is the net export effect: an increase in the price of national goods reduces the volume of foreign demand for them and at the same time increases the demand for imported goods.

In the Russian economy, in conditions of extremely high inflation, a fading investment process, and the underdevelopment of reliable savings and lending instruments, the first two effects, apparently, hardly manifest themselves. In addition, inflationary expectations, especially at high rates of price growth, stimulate rush demand, which leads to an increase in current household consumption. Therefore, aggregate demand is relatively inelastic.

Change in aggregate demand. In reality, aggregate demand rarely stays stable for long. It consists of the total demand for national goods and services from four large groups of consumers: the population, private firms, government agencies and foreigners. Any significant change in the needs and capabilities of any of these groups will be reflected in aggregate demand, causing it to increase or decrease. Monetarist economists believe that the main reason for the instability of aggregate demand is an excess or shortage of the money supply in circulation.

The growth of aggregate demand looks on the chart as a shift of the AD curve to the right and up (from AD 1 to AD 2). This means that now all consumers, taken together, are ready to buy more of the national product at the same price level, or the same amount of national product at higher prices.

Figure 12-1 shows that an increase in aggregate demand can be accompanied by a reduction in real aggregate spending with a very large increase in prices (movement from point a to point b), and a decrease in prices - with a very large increase in aggregate demand (movement from point a to point b). point c). The only thing that can not be observed in this case is a simultaneous reduction in real costs and lower prices.

Accordingly, the decrease in aggregate demand looks on the graph as a shift of the AD curve to the left and down (from AD 1 to AD 3). The main difficulty in determining and forecasting aggregate demand is related to the extreme diversity of interests and intentions of numerous consumer groups that are under the simultaneous influence of many factors of different strength and nature, often acting in opposite directions. For example, an increase in taxes on personal and firm incomes will cause a reduction in consumer spending and private investment, which will push the AD curve down to the left; but the funds received from additional taxes will partly return to the population in the form of transfer payments and payments for resources, increasing consumption, partly will be spent by the state on the purchase of national goods and services - all this will push the AD curve upwards to the right. The final result in terms of aggregate demand is rather uncertain.

Growth in the level of aggregate demand. Aggregate offer. Consider an economy in a deep, protracted depression, with stable prices and mass unemployment. If aggregate demand begins to grow in such an economy (for example, due to government orders), firms, sensing this, will increase production volumes, hiring more workers, buying more raw materials and fuel, increasing the degree of production capacity utilization, etc. Will prices rise as a result? Only in the case of an increase in average costs. But given the same technology, the only reason for this could be a rise in resource prices (assume that only a negligible fraction of the resources are purchased from abroad). The growth in production is accompanied by an increase in demand for resources, but this will not cause their rise in price: their excess is too great, there are too many idle resources. So, there is an increase in the production and sale of the national product without a noticeable increase in the price level (Fig. 12-2).

With a further increase in aggregate demand, as the economy approaches full employment, prices for many resources begin to rise. This is due, firstly, to the fact that various resources are far from being completely interchangeable and are used in different industries, besides, the demand for the products of different industries is growing at different rates, so the state of full employment, exhausted production possibilities in a number of industries is reached earlier, than in the economy as a whole. Secondly, the resources have different quality (which determines their consumption per unit of output with the same technology), and the best quality resources are used in the first place. Thirdly, as the load on the capacity of the enterprise increases, the law of diminishing returns of variable resources begins to operate. As a result, average costs and prices for many goods and services will rise - inflation will begin and the mechanisms of its self-reproduction will turn on. So, further growth in aggregate demand will be accompanied by an increase in the national product with some, as a rule, moderate inflation (Fig. 12-3) - up to full employment. If the growth of aggregate demand continues at full employment of resources, the economy will be unable to produce more goods and services, and all the energy of the growing demand will be spent on raising the inflation rate (Figure 12-4).

Rice. 12-4. Aggregate supply curve

The trajectory that the point of macroeconomic equilibrium describes following the growing aggregate demand from a position of deep depression to a position of full employment (Figure 12-4) is called the aggregate supply curve. It consists of three segments:

1) horizontal (plot ab), corresponding to an economy in a deep crisis or depression (it is also called Keynesian, after the English economist J.M. Keynes, who discovered this phenomenon);

2) vertical (section cd), corresponding to full employment (also called classical - according to the economic school, whose followers claim that the entire AS curve in a normal economy consists of this one segment);

3) intermediate (section bс), connecting the other two.

Reducing aggregate demand. Ratchet effect. Let us now see how the equilibrium will shift with a reduction in aggregate demand.

Rice. 12-5. Ratchet effect

J. Keynes showed that prices behave very differently under pressure on them up and down. Upward (for example, following the growing demand), prices take off easily, “willingly”, and almost without delay (time lag). But with downward pressure on them, they instantly lose their flexibility and offer stubborn resistance. This interesting and important property of prices has been called the ratchet effect by economists (Figure 12-5). The main reason for this is the limited competition both in many markets for goods and services, where supply and, consequently, prices are controlled by large firms, and in resource markets, where, among other things, institutional constraints are strong (trade unions, labor laws, etc.). ). The psychological unwillingness of people to voluntarily agree to a reduction in nominal income also has a great influence, even the owners of private firms themselves try to avoid such measures as much as possible. So, large firms support prices in an effort to reduce the loss of profits, but in a crisis, falling demand, this can only be done by reducing production (and jobs). Therefore, it is more likely that the economy will end up not at point M, but at point N, in a general downturn.

Growth in aggregate supply. From the above analysis, it follows that the position on the vertical segment of the AS curve is adequate to the position on the production possibilities curve, and the position on the horizontal segment of the AS curve is adequate to the position deep within the production possibilities sector (Fig. 12-6).

Rice. 12-6. Relationship between macroeconomic equilibrium and resource use.

An increase in aggregate supply looks like a shift in the AS curve to the right and down (Figure 12-7). This is tantamount to expanding the productive possibilities of the national economy and is reflected on the production possibilities curve as economic growth.

Rice. 12-7. Changing the Production Possibility Curve as Aggregate Supply Grows

Similarly, a contraction in aggregate supply, in which the AS curve shifts to the left and up (Figure 12-8), means a narrowing of the economy's productive possibilities.

Rice. 12-8. Changing the Production Possibility Curve as Aggregate Supply Decreases

Let us now consider the macroeconomic consequences of a change in aggregate supply, assuming, for simplicity, aggregate demand to be unchanged.

Rice. 12-9 Consequences of economic growth

On fig. 12-9, the consequences of economic growth or any other expansion of national production possibilities are clearly visible - this is the most favorable and desirable thing that can happen to the economy, while the growth of the national product necessarily occurs, and prices are pressed down by a powerful factor of growing productivity, which, in contrast from falling demand, they are "willingly" ready to obey. True, in reality, deflation (price reduction) is unlikely, since the growth of production will certainly be accompanied by an expansion of aggregate demand and the equilibrium will shift from point E 1 not to point E 2 , but to point E 3 . Economic growth is almost always accompanied by some moderate inflation, but, on the other hand, the growth of aggregate demand creates additional incentives for the expansion of production and accumulation, and a decrease in average costs restrains inflation, preventing it from “dispersing”.

Reducing the aggregate supply. As much as the consequences of economic growth are beneficial for the economy, the most unpleasant and sad thing that can happen to it is a reduction in national production capabilities, the consequences of which are a simultaneous drop in production and an increase in prices (Fig. 12-10). This state of the economy is sometimes called stagflation - this is the so-called inflation of growing costs, the root cause of which is the deterioration in the resource supply of the economy.

Rice. 12-10. Consequences of the economic downturn

The main danger of such a state of the economy is that it drives the macroeconomic stabilization policy into a dead end: the fact is that anti-crisis policy usually gives the economy some inflationary impetus, while anti-inflationary policy leads to some decline in production and loss of jobs (due to the ratchet effect). If you look at the graph, it is easy to understand that in conditions of stagflation, the traditional methods of macroeconomic regulation are unacceptable, otherwise, by solving one problem, we will exacerbate another (and then at best).

However, in a normally developing economy of the "Western" type, the spontaneous occurrence of stagflation is unlikely due to the highest adaptive potential. The economies of developed countries faced this phenomenon seriously relatively recently, in the 70s, due to the coincidence of a number of unfavorable factors, the main of which was external: the rapid rise in oil prices due to the actions of the OPEC cartel and the prices of many other resources. The situation was saved by private initiative and scientific and technological revolution: in developed countries, a deep structural restructuring of the economy began in the direction of transition to resource-saving technologies, to a real intensive model of economic growth, i.e. stagflation was largely defeated at the microeconomic level: by the efforts of private firms rather than governments.

This is exactly how, in conditions of severe stagflation, the general crisis of the Russian economy is developing today. But the initial blow - a sharp reduction in production capabilities in the early 1990s - was so strong that it did not "tilt the barrel dangerously", as was the case with the "Western" economy in the 70s, but "tipped" it. At the same time, the absolute structural, institutional, psychological and professional unpreparedness of the Russian national economy, state and human resources for market relations and for such a catastrophe did not allow us to hope for a solution to problems “from below”.

"Shock therapy" further aggravated the situation. The liberalization of prices and all economic activity in January 1992 was carried out in conditions of extremely limited competition, extremely low productivity and high resource intensity, inflationary expectations pushed to the limit, a complete and general lack of adequate experience, in an economy with a "obsessed" with itself and highly militarized industrial structure. The immediate results were a shock rise in average costs in all industries, the "disappearance" of working capital, the transition of inflationary expectations "beyond all limits" and the beginning of a monstrous restructuring of the economy in terms of scale, nature, pace and consequences, including the almost complete curtailment of the accumulation process.

All of these factors immediately threw the A8 curve of the Russian economy sharply to the left and continue to put powerful pressure on it in the same direction. Of course, these processes cannot develop without end - in the same way as any fire will stop by itself, but what remains after the fire will bear little resemblance to the original building.

E) Change in the money supply.

117. Ceteris paribus, an increase in aggregate demand at full employment of resources leads to:

A) demand-pull inflation.

C) a decrease in the real interest rate.

C) To excess of export over import.

D) To an increase in the real interest rate.

E) To the growth of private investment.

118. An intermediate segment on the aggregate supply curve:

A) Has a positive slope.

B) Has a negative slope.

C) Represented by a horizontal line.

D) Represented by a vertical line.

E) Represented as a bisector.

119. An increase in aggregate spending in the Keynesian model will lead to a shift in the aggregate demand curve:

A) to the left by the amount of reduction in total costs, multiplied by the value of the multiplier

C) to the right by the amount of growth in total costs, multiplied by the value of the multiplier

C) to the left by the amount of growth in total costs, multiplied by the value of the multiplier

D) to the right by the amount of reduction in total costs, multiplied by the value of the multiplier

E) there are no correct answers

120. The multiple increase in NNP due to a slight increase in investment costs is caused by:

A) the multiplier effect

B) the paradox of thrift

C) A. Smith effect

D) technical revolution

E) all answers are correct

121. A recessionary gap is:

C) the amount of total costs

D) equilibrium volume of NNP

E) the amount of savings

122. Which of the listed concepts of the classical macroeconomic theory was criticized by D. Keynes?

A) the principle of state intervention

C) the principle of equality of savings and investments

C) the principle of state non-intervention

D) the principle of inequality of savings and investments

E) all answers are correct

123. The inflationary gap is:

A) the amount by which total spending is less than the level of NNP at full employment

C) the amount by which total spending exceeds the level of NNP at full employment

C) the amount of total costs

D) equilibrium volume of NNP

E) the amount of savings

124. If the volume of aggregate demand increases the level of GNP achieved at full employment, then this means that in the economy:

A) there is a recessionary gap

B) there is an inflationary gap

C) there will be an increase in production costs

D) there will be a reduction in production costs

E) partial equilibrium reached

125. If the volume of equilibrium GNP is greater than its potential level, then:

A) the price level will rise

B) the price level will fall

C) the price level will not change

D) there will be an increase in production costs

E) there will be a decrease in production costs

126. The aggregate demand curve expresses the relationship between:

E) there is no correct answer

127. When the position of the economy corresponds to the Keynesian segment of the curve

aggregate supply, an increase in aggregate demand will:

A) to reduce the volume of GDP in real terms, but will not affect the price level

C) to increase the volume of GDP in real terms, but will not affect the price level

C) to a decrease in the volume of GDP in real terms and to a decrease in the price level

D) to an increase in the volume of GDP in real terms and to an increase in the price level

E) to an increase in the volume of GDP in real terms and to a decrease in the price level

128. The aggregate supply curve expresses the relationship between:

A) the price level and total expenditure on the purchase of goods and services

C) the price level and the volume of GDP produced in real terms

C) the price level and the total cost of producing goods and services

D) the price level and the level of disposable income

E) there is no correct answer

129. If the state tightens requirements for the preservation of the environment, this causes:

A) a decrease in production costs per unit of output and a shift in the aggregate supply curve to the left

B) an increase in production costs per unit of output and a shift in the aggregate supply curve to the left

C) a decrease in production costs per unit of output and a shift in the aggregate supply curve to the right

D) an increase in production costs per unit of output and a shift in the aggregate supply curve to the right

E) there is no correct answer

4.3 Production and the labor market

130. To study the short-term period in the economy, an assumption is made about:

A) Price inflexibility;

B) Rising fixed costs;

C) Flexible investment rate;

D) Change in factors of production;

E) Constant economies of scale growth.

131. In the long run, an assumption is made about:

A) Price and wage flexibility;

B) the constancy of all factors of production;

C) Rigidity of the investment rate;

D) Change only the variable factor;

E) Decreasing economies of scale of growth.

132. The firm will hire an additional worker for the time being (w/P is the real wage; MP L is the marginal product of labor).

133. The production function in general terms is represented as:

A) Y = F (K, L);

B) Y = F(K) - F(L);

D) Y = F (K, L) - F (P);

134. The total income is equal to:

A) The amount of tenge received by producers as profit;

C) The total amount of tenge earned by workers;

C) the total product of the economy;

D) the total rent collected by the owners of capital;

E) Total savings.

135. A competitive firm accepts:

A) Prices for their products and factors of production as given;

C) given prices for products of production, but not for factors of production;

C) Set prices for factors of production, but not for their output;

D) Not given prices for manufactured products, nor for factors of production;

E) The decision is independent of market conditions.

136. The production function has the property of constant returns to scale:

A) if capital and labor are increased by 10%, then output will decrease by 10%;

C) if capital and labor are increased by 5%, then output will increase by 10%;

C) if you increase capital and labor by 10%, then output will also increase by 10%; D) if capital is increased by Z1 and labor by Z2, then output will increase by Z3;

E) if K is increased by 10%, and L by 5%, then output will increase by 7.5%.

137. What characterizes the marginal product of capital:

A) how much output will increase when using an additional unit of capital;

B) how much output will decrease when using an additional unit of capital;

C) technology level;

D) the rate of replacement of capital by labor;

E) the level of growth in the value of fixed capital.

138. According to what law, when an additional unit of capital is involved, the return on its use decreases.

A) the law of marginal diminishing returns;

B) Okun's law;

C) the law of demand;

D) diminishing effect of the scale of growth;

E) the law of rational expectations.

139. What factor does not affect the growth of national income?

A) increase in labor productivity.

B) an increase in the working day in the sphere of material production.

C) growth in the number of employees in the public sector.

D) increasing the intensity of labor.

E) an increase in the number of hired workers in the sphere of material production.

140. In the long run, the level of output in the economy is determined by:

A) The preferences of the population.

B) The amount of capital and labor, as well as the level of technology used.

C) the level of the interest rate.

D) the price level.

E) The money supply, the level of government spending and taxes.

141. Production function Y = F(K, L) has constant returns to scale if:

142. The Keynesian model considers:

A) The price level.

B) The functioning of the economy in relatively short periods of time.

C) salary.

D) production costs.

E) product release.

143. If the production function has increasing returns to scale, then there is:

A) mixed growth.

B) uncertainty.

C) decline in production.

D) extensive growth.

E) intensive growth.

144. The capital-labor ratio of labor is:

A) Capital produced over a long period of time.

B) The amount of capital per employee.

C) The ratio of the number of employees to the monetary value of capital.

D) The number of shares held by employees.

E) Capital produced during the year.

145. Equilibrium is established in the labor market when:

A) The magnitude of the demand for labor is equal to the number of people employed in the economy.

B) The supply of labor is equal to the number of workers.

C) The marginal product of labor is equal to the demand price of labor.

D) The marginal product of labor is equal to the supply price of labor;

E) The monetary value of marginal product is equal to the nominal wage rate.

146. According to the classical model, when the labor market is in equilibrium, then:

A) There is full employment.

B) Some people who want to work for real wages cannot find a job.

C) Jobs are created because firms cannot hire the required number of workers.

D) Potential GNP is higher than actual.

E) Taxes allow the labor market to achieve an efficient distribution of labor.

4.4 The market for goods

147. What taxes are indirect:

A) excise taxes, value added tax

B) personal income tax

C) property tax