Name:________________________________
Economics 121 A & B
Fall 1996 - Prof. Becker
1. (2 points) During which administration was GDP
growth the greatest? How much was it?
2. (2 points) During which administration was inflation
the greatest? How much was it?
3. (4 points) Why should the ratio of net investment
to GDP be more important in determining the level of future growth
than either the real or nominal level of net investment?
4. (6 points) Draw a graph of aggregate demand (AD)
and aggregate supply (AS). Shift the curves in a way consistent
with the changes in the price level (% CPI) and real output (%
real GDP) during the Kennedy/Johnson administration (1961-1965).
Explain your graph briefly.