test 1

This course focuses on the macroceonomy in the short and medium run. Of particular interest are the effects of monetary policy and fiscal policy in open and closed economies. The course has the following themes: 1. Repetition of basic concepts and the global economy Circular flow model, Keynesian cross, the demand side of the world economy. 2. Demand side equilibrium in one economy Balance of payments, the foreign exchange market, Mundell‑Fleming model for the demand side equilibrium in one economy 3. The labour market and unemployment The supply side of the economy in the short and medium term, reasons for temporary and long term unemployment. 4. The economy in the short and medium term Integration of the supply and the demand side in the AD‑AS model, the influence of shocks and policy measures on prices and income, the Phillipps curve. 5. Budget deficits and public debt Neoclassical and Keynesian analysis, Ricardian equivalence 6. Public debt and sovereign debt crises debt dynamics

In the Keynesian cross model...

a decrease in the marginal propensity to consume decreases the slope of the AE curve

In the IS-LM model, the IS curve ...

is derived using the same equilibrium condition as in the Keynesian cross model.

depicts all the combinations of GDP and the interest rate that result in a goods market equilibrium.

consider the closed economy Keynesian cross equilibrium condition LaTeX: Y = C + I + GY = C + I + G.

The government spending multiplier is unaffected by taxes in this case.
The government spending multiplier is equal to 2.
 

Mark the correct statements about money demand and the LM curve.
Correct!
 
Correct!
 

i =

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