Aggregate Demand and Economic Activity (AQA A-Level Economics): Quizzes
📚Quizzes
Practise the questions
10 questions from this quiz
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Practise the questions
10 questions from this quiz
What does economic activity refer to?
What does economic activity refer to?
Overall level of production & consumption
When aggregate demand increases, what happens to real output and employment?
When aggregate demand increases, what happens to real output and employment?
Both increase
What does the national income multiplier measure?
What does the national income multiplier measure?
Initial change in AD & resulting change
If income rises from £2000bn to £2050bn after £10bn spending increase, what is the multiplier?
If income rises from £2000bn to £2050bn after £10bn spending increase, what is the multiplier?
5
What are the government spending and tax multipliers collectively known as?
What are the government spending and tax multipliers collectively known as?
Fiscal policy multipliers
What is the relationship between MPC and MPS?
What is the relationship between MPC and MPS?
MPC + MPS = 1
If MPC = 0.6, what is the multiplier value using ?
If MPC = 0.6, what is the multiplier value using ?
2.5
What is the effect of a high MPC on multiplier size?
What is the effect of a high MPC on multiplier size?
Creates a large multiplier
Why are tax and import multipliers always negative?
Why are tax and import multipliers always negative?
They are withdrawals from circular flow
When SRAS slopes upward, how does the real multiplier compare to the nominal multiplier?
When SRAS slopes upward, how does the real multiplier compare to the nominal multiplier?
Real multiplier is smaller