Home / My Courses / 2025 Fall 1 BADM 7200E for Faik Koray (Online)
/ Module 4: Using the AD-AS and IS-LM Models / Module 4 Homework Assignment
Module 4 Homework Assignment
Status Finished
Started Wednesday, September 17, 2025, 8:27 AM
Completed Friday, September 19, 2025, 9:36 AM
Duration 2 days 1 hour
Grade 100.00 out of 100.00
Question 1
Correct 4.00 points out of 4.00
If the short-run aggregate supply curve is horizontal and the long-run aggregate supply curve is vertical,
then a change in the money supply will change ______ in the short run and change ______ in the long run.
Select one:
A. only output; only prices
B. both prices and output; both prices and output
C. only prices; only output
D. both prices and output; only prices
The correct answer is: only output; only prices
Question 2
Correct 4.00 points out of 4.00
If a short-run equilibrium occurs at a level of output above the natural rate, then in the transition to the
long run prices will ______, and output will ______.
Select one:
A. increase; decrease
B. decrease; increase
C. decrease; decrease
D. increase; increase
The correct answer is: increase; decrease
, Question 3
Correct 4.00 points out of 4.00
Stabilization policy refers to policy actions aimed at:
Select one:
A. maintaining constant shares of output going to labor and capital.
B. reducing the severity of short-run economic fluctuations.
C. preventing increases in the poverty rate.
D. equalizing incomes of households in the economy.
The correct answer is: reducing the severity of short-run economic fluctuations.
Question 4
Correct 4.00 points out of 4.00
If the short-run aggregate supply curve is horizontal, and each member of the general public chooses to
hold a larger fraction of his or her income as cash balances, then:
Select one:
A. prices will increase in the short run.
B. output and employment will increase in the short run.
C. prices will decrease in the short run.
D. output and employment will decrease in the short run.
The correct answer is: output and employment will decrease in the short run.
Question 5
Correct 4.00 points out of 4.00
In the Keynesian-cross model, if the MPC equals 0.75, then a $3 billion decrease in taxes increases planned
expenditures by ______ and increases the equilibrium level of income by ______.
Select one:
A. $3 billion; $3 billion
B. $2.25 billion; $2.25 billion
C. $3 billion; $9 billion
D. $2.25 billion; $9 billion
The correct answer is: $2.25 billion; $9 billion
/ Module 4: Using the AD-AS and IS-LM Models / Module 4 Homework Assignment
Module 4 Homework Assignment
Status Finished
Started Wednesday, September 17, 2025, 8:27 AM
Completed Friday, September 19, 2025, 9:36 AM
Duration 2 days 1 hour
Grade 100.00 out of 100.00
Question 1
Correct 4.00 points out of 4.00
If the short-run aggregate supply curve is horizontal and the long-run aggregate supply curve is vertical,
then a change in the money supply will change ______ in the short run and change ______ in the long run.
Select one:
A. only output; only prices
B. both prices and output; both prices and output
C. only prices; only output
D. both prices and output; only prices
The correct answer is: only output; only prices
Question 2
Correct 4.00 points out of 4.00
If a short-run equilibrium occurs at a level of output above the natural rate, then in the transition to the
long run prices will ______, and output will ______.
Select one:
A. increase; decrease
B. decrease; increase
C. decrease; decrease
D. increase; increase
The correct answer is: increase; decrease
, Question 3
Correct 4.00 points out of 4.00
Stabilization policy refers to policy actions aimed at:
Select one:
A. maintaining constant shares of output going to labor and capital.
B. reducing the severity of short-run economic fluctuations.
C. preventing increases in the poverty rate.
D. equalizing incomes of households in the economy.
The correct answer is: reducing the severity of short-run economic fluctuations.
Question 4
Correct 4.00 points out of 4.00
If the short-run aggregate supply curve is horizontal, and each member of the general public chooses to
hold a larger fraction of his or her income as cash balances, then:
Select one:
A. prices will increase in the short run.
B. output and employment will increase in the short run.
C. prices will decrease in the short run.
D. output and employment will decrease in the short run.
The correct answer is: output and employment will decrease in the short run.
Question 5
Correct 4.00 points out of 4.00
In the Keynesian-cross model, if the MPC equals 0.75, then a $3 billion decrease in taxes increases planned
expenditures by ______ and increases the equilibrium level of income by ______.
Select one:
A. $3 billion; $3 billion
B. $2.25 billion; $2.25 billion
C. $3 billion; $9 billion
D. $2.25 billion; $9 billion
The correct answer is: $2.25 billion; $9 billion
