The BMZ Academy @ 061 262
THE BMZ ACADEMY
@061 262 1185/068 053 8213
BMZ ACADEMY 061 262 1185/068 053 8213
,7/6/25, 10:46 AM Assessment 2: Attempt review
UNISA 2025 ECS1601-25-Y Welcome Message Assessment 2
QUIZ
Started on Sunday, 6 July 2025, 9:54 AM
State Finished
Completed on Sunday, 6 July 2025, 10:45 AM
Time taken 51 mins 21 secs
Marks 20.00/20.00
Grade 100.00 out of 100.00
Question 1
Correct
Mark 1.00 out of 1.00
What does it mean when there is a surplus on a country’s current account?
Select one:
a. The value of a country’s liabilities is more than the value of its assets.
b. The value of a country’s imports is more than the value of its exports.
c. The value of a country’s assets is more than the value of its liabilities.
d. The value of a country’s exports is more than the value of its imports.
Question 2
Correct
Mark 1.00 out of 1.00
If nominal GDP rises ...
Select one:
a. we can be certain that the price level has risen.
b. real GDP may either rise, fall or stay the same.
c. real GDP must fall.
d. real GDP must also rise.
Question 3
Correct
Mark 1.00 out of 1.00
In the Keynesian model, GDP is determined by …
Select one:
a. level of aggregate spending.
b. level of taxes.
c. price level.
d. level of aggregate supply.
https://mymodules.dtls.unisa.ac.za/mod/quiz/review.php?attempt=28208068&cmid=1102903 1/9
,7/6/25, 10:46 AM Assessment 2: Attempt review
Question 4
Correct
Mark 1.00 out of 1.00
With respect to the aggregate expenditure function, it is true that …
a. at any point below the 45-degree line and above the aggregate expenditure function, it is likely that inventories must
rise to reach equilibrium.
b. at any and every point on the 45-degree line the economy is in equilibrium.
c. at any point below the 45-degree line and above the aggregate expenditure function, inventories are zero.
d. at any point on the 45-degree line, inventories are falling.
e. The equilibrium level of income is larger when the aggregate expenditure function is flatter
At any point below the 45-degree line, there is excess supply as total production is greater than aggregate spending. Thus, at
any point below the 45-degree line and above the aggregate expenditure function, the inventories are rising. However, in order
to reach equilibrium, the inventories must fall. At any and every point on the 45 degree line, the economy is in equilibrium, that
is, 𝑌=𝐴.
Question 5
Correct
Mark 1.00 out of 1.00
Which one of the following factors will increase the size of the multiplier?
a. an increase in government spending
b. an increase in the marginal propensity to consume
c. an increase in the marginal propensity to save
d. increase in autonomous consumption
Government spending and Autonomous Consumption in the Keynesian model are autonomous expenditures, consequently
an increase in government spending or autonomous consumption will only increase aggregate spending. An increase in the
marginal propensity to save will decrease the marginal propensity to consume as MPS = 1-MPC, the lower MPC will reduce
the size of the multiplier.
https://mymodules.dtls.unisa.ac.za/mod/quiz/review.php?attempt=28208068&cmid=1102903 2/9
, 7/6/25, 10:46 AM Assessment 2: Attempt review
Question 6
Correct
Mark 1.00 out of 1.00
Which of the following is likely to shift the consumption schedule upwards?
a. Expectations of a rise in interest rates.
b. Consumer prices are expected to fall.
c. A currently large stock of durable goods in the possession of consumers.
d. The expectation of a future rise in the consumer price index.
Any increase in autonomous consumption will shift the consumption curve upwards. Therefore, any factor that causes an
increase in autonomous expenditure will shift the consumption function upwards. An expectation that interest rates will rise
may cause a decrease in consumption, as people may decide to borrow less because they expect interest rates to rise and
their interest payments to become more in future, shifting the consumption function downward.
If prices are expected to fall, consumers will most likely wait for the prices to fall before spending more on consumption.
Therefore, such an expectation will not shift the consumption function upwards. If consumers have a large stock of durable
goods, this means they don’t have to spend more on such goods now, and therefore the consumption function will most likely
not shift upwards.
If prices are expected to rise, it is highly likely that consumers will now spend more before the price rise actually takes place,
leading to an upward shift of the consumption function. Refer to Box 6-2 where the factors that may cause a shift of the
consumption function are discussed.
Question 7
Correct
Mark 1.00 out of 1.00
Which of the following statements is/are correct?
a) Induced consumption refers to the fixed part of consumption spending which does not change as the level of income
changes.
b) The slope of the consumption function is always greater than that of the aggregate spending curve.
c) If the marginal propensity to save increases, the equilibrium level of income will increase.
a. All the statements are correct.
b. a and b
c. b and c
d. a and c
e. None of the statements are correct.
Induced consumption is the component of consumption that is determined by the income level (cY). c is incorrect as an
increase in the marginal propensity to save will reduce the multiplier (by reducing the marginal propensity to consume)
reducing equilibrium income, consequently option c is incorrect. Slope of the consumption function is less than the
aggregate expenditure curve, as a result option b is incorrect.
https://mymodules.dtls.unisa.ac.za/mod/quiz/review.php?attempt=28208068&cmid=1102903 3/9
THE BMZ ACADEMY
@061 262 1185/068 053 8213
BMZ ACADEMY 061 262 1185/068 053 8213
,7/6/25, 10:46 AM Assessment 2: Attempt review
UNISA 2025 ECS1601-25-Y Welcome Message Assessment 2
QUIZ
Started on Sunday, 6 July 2025, 9:54 AM
State Finished
Completed on Sunday, 6 July 2025, 10:45 AM
Time taken 51 mins 21 secs
Marks 20.00/20.00
Grade 100.00 out of 100.00
Question 1
Correct
Mark 1.00 out of 1.00
What does it mean when there is a surplus on a country’s current account?
Select one:
a. The value of a country’s liabilities is more than the value of its assets.
b. The value of a country’s imports is more than the value of its exports.
c. The value of a country’s assets is more than the value of its liabilities.
d. The value of a country’s exports is more than the value of its imports.
Question 2
Correct
Mark 1.00 out of 1.00
If nominal GDP rises ...
Select one:
a. we can be certain that the price level has risen.
b. real GDP may either rise, fall or stay the same.
c. real GDP must fall.
d. real GDP must also rise.
Question 3
Correct
Mark 1.00 out of 1.00
In the Keynesian model, GDP is determined by …
Select one:
a. level of aggregate spending.
b. level of taxes.
c. price level.
d. level of aggregate supply.
https://mymodules.dtls.unisa.ac.za/mod/quiz/review.php?attempt=28208068&cmid=1102903 1/9
,7/6/25, 10:46 AM Assessment 2: Attempt review
Question 4
Correct
Mark 1.00 out of 1.00
With respect to the aggregate expenditure function, it is true that …
a. at any point below the 45-degree line and above the aggregate expenditure function, it is likely that inventories must
rise to reach equilibrium.
b. at any and every point on the 45-degree line the economy is in equilibrium.
c. at any point below the 45-degree line and above the aggregate expenditure function, inventories are zero.
d. at any point on the 45-degree line, inventories are falling.
e. The equilibrium level of income is larger when the aggregate expenditure function is flatter
At any point below the 45-degree line, there is excess supply as total production is greater than aggregate spending. Thus, at
any point below the 45-degree line and above the aggregate expenditure function, the inventories are rising. However, in order
to reach equilibrium, the inventories must fall. At any and every point on the 45 degree line, the economy is in equilibrium, that
is, 𝑌=𝐴.
Question 5
Correct
Mark 1.00 out of 1.00
Which one of the following factors will increase the size of the multiplier?
a. an increase in government spending
b. an increase in the marginal propensity to consume
c. an increase in the marginal propensity to save
d. increase in autonomous consumption
Government spending and Autonomous Consumption in the Keynesian model are autonomous expenditures, consequently
an increase in government spending or autonomous consumption will only increase aggregate spending. An increase in the
marginal propensity to save will decrease the marginal propensity to consume as MPS = 1-MPC, the lower MPC will reduce
the size of the multiplier.
https://mymodules.dtls.unisa.ac.za/mod/quiz/review.php?attempt=28208068&cmid=1102903 2/9
, 7/6/25, 10:46 AM Assessment 2: Attempt review
Question 6
Correct
Mark 1.00 out of 1.00
Which of the following is likely to shift the consumption schedule upwards?
a. Expectations of a rise in interest rates.
b. Consumer prices are expected to fall.
c. A currently large stock of durable goods in the possession of consumers.
d. The expectation of a future rise in the consumer price index.
Any increase in autonomous consumption will shift the consumption curve upwards. Therefore, any factor that causes an
increase in autonomous expenditure will shift the consumption function upwards. An expectation that interest rates will rise
may cause a decrease in consumption, as people may decide to borrow less because they expect interest rates to rise and
their interest payments to become more in future, shifting the consumption function downward.
If prices are expected to fall, consumers will most likely wait for the prices to fall before spending more on consumption.
Therefore, such an expectation will not shift the consumption function upwards. If consumers have a large stock of durable
goods, this means they don’t have to spend more on such goods now, and therefore the consumption function will most likely
not shift upwards.
If prices are expected to rise, it is highly likely that consumers will now spend more before the price rise actually takes place,
leading to an upward shift of the consumption function. Refer to Box 6-2 where the factors that may cause a shift of the
consumption function are discussed.
Question 7
Correct
Mark 1.00 out of 1.00
Which of the following statements is/are correct?
a) Induced consumption refers to the fixed part of consumption spending which does not change as the level of income
changes.
b) The slope of the consumption function is always greater than that of the aggregate spending curve.
c) If the marginal propensity to save increases, the equilibrium level of income will increase.
a. All the statements are correct.
b. a and b
c. b and c
d. a and c
e. None of the statements are correct.
Induced consumption is the component of consumption that is determined by the income level (cY). c is incorrect as an
increase in the marginal propensity to save will reduce the multiplier (by reducing the marginal propensity to consume)
reducing equilibrium income, consequently option c is incorrect. Slope of the consumption function is less than the
aggregate expenditure curve, as a result option b is incorrect.
https://mymodules.dtls.unisa.ac.za/mod/quiz/review.php?attempt=28208068&cmid=1102903 3/9
