The National Economy

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1.Which components constitute total injections in an economy?

investment plus taxes plus exportssavings combined with government spending and exportsinvestment along with government spending and importsinvestment together with government spending and exports

2.Which components are included solely in aggregate demand?

consumer spending, government spending, and investmentconsumer spending, investment, government spending, plus exports minus importsconsumer debt, investment debt, and government debt

3.How is the duration of a business cycle typically determined?

From the recession phase to the recovery phaseFrom one peak to the next peakFrom the highest point to the lowest pointFrom the lowest point to the highest point

4.Which of the following measures reflects the price index of all goods produced within a country's economy?

Index of wholesale prices (WPI)Index measuring consumer price changes (CPI)Gross Domestic Product (GDP) deflatorIndex of producer prices (PPI)

5.Which event led to the development of macroeconomic theory that highlighted Keynesian ideas and reduced emphasis on classical economics?

The inability of economic theories to account for rising inflation and unemployment occurring together in the 1970sThe failure of the classical economic framework to explain the extended period of high unemployment during the Great DepressionThe shortcomings of economic fine-tuning efforts during the 1960sThe economy's inability to sustain rapid growth throughout the 1950sThe collapse of international trade after World War II

6.Which area of economics focuses on the overall performance and behavior of the entire economy?

Markets characterized by imperfect competitionAdjustments to economic equilibrium solely in the long termAnalysis of specific industries and the choices made by firms and householdsThe study of the economy in its entiretyNone of the above