Consider a Simple Macro Model with Demand- Determined Output

question 30

Multiple Choice

Consider a simple macro model with demand- determined output. An exogenous increase in the domestic price level will

• A)pivot the net export function and the AE curve upward.
• B)shift the net export function downward and the AE curve upward.
• C)shift both the net export function and the AE curve upward.
• D)shift the net export function upward and the AE curve downward.
• E)shift both the net export function and the AE curve downward.

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Definitions:

Actual Production

The real quantity of goods or services produced over a specified period, as opposed to planned or expected production levels.

Direct Material Price Variance

The difference between the actual cost of direct materials used in production and the expected (or standard) cost of those materials.

Cost Standards

The benchmarks or norms established for the cost of materials, labor, and overhead that are used in measuring and controlling performance.

Actual Results

The outcomes or data obtained from real operations or experiments, not based on forecasts or estimates.