Under the George W - Indiana State University



[A, at the end]

Under the George W. Bush Administration, federal income taxes were cut twice and boosted defense spending substantially. Taken together these actions are likely to have

a) increased aggregate demand

b) decreased aggregate demand

c) increased aggregate supply

d) decreased aggregate supply

[A, at the end]

If, in response to a weak employment picture, a law was passed to increase the number of lanes on all interstate highways by at least one lane this would likely

a) increase aggregate demand

b) decrease aggregate demand

c) increase aggregate supply

d) decrease aggregate supply

[C, at the end]

If Iraq were to become a stable oil producing friend of the U.S., this would likely

a) increase aggregate demand

b) decrease aggregate demand

c) increase aggregate supply

d) decrease aggregate supply

[C, at the end]

If there was a significant find of natural gas in a readily accessible location in the U.S. this would likely

a) increase aggregate demand

b) decrease aggregate demand

c) increase aggregate supply

d) decrease aggregate supply

[B, at the end]

Suppose the U.S. was to experience a series of terrorists attacks aimed at keeping consumers away from large shopping areas. Suppose further that the primary effect is for consumer confidence to decrease, this would likely

a) increase aggregate demand

b) decrease aggregate demand

c) increase aggregate supply

d) decrease aggregate supply

[D, at the end]

Suppose the U.S. was to experience a series of terrorists attacks aimed at the electricity grid. This would likely

a) increase aggregate demand

b) decrease aggregate demand

c) increase aggregate supply

d) decrease aggregate supply

[A, at the end]

Suppose as a reaction to terrorist attacks the U.S. government were to create a new branch of the military employing 1,000,000 new service men and women to monitor malls, large sporting events, and infrastructure (bridges, dams, refineries, etc.) Hiring and paying these people would likely

a) increase aggregate demand

b) decrease aggregate demand

c) increase aggregate supply

d) decrease aggregate supply

[A, at the end]

In reaction to the terrorist attacks of September 11, 2001 the Federal Reserve moved to lower interest rates. This was intended to

a) increase aggregate demand

b) decrease aggregate demand

c) increase aggregate supply

d) decrease aggregate supply

[A, at the end]

In reaction to the recession of 2001, a tax cut was passed in which tax rebate checks were sent to millions of American families. This was intended to

a) increase aggregate demand

b) decrease aggregate demand

c) increase aggregate supply

d) decrease aggregate supply

[B, at the end]

Suppose the Federal Reserve wanted to fight inflation by increasing interest rates. Doing so would

a) increase aggregate demand

b) decrease aggregate demand

c) increase aggregate supply

d) decrease aggregate supply

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