Consumer wealth is not a determinant of aggregate demand TRUE FALSE 7 When the economy appears to be slowing down and to the right of a cycle peak A policy makers are most likely to implement expansionary policy B policy makers are most likely to implement contractionary policy C policy makers are most likely to implement restrictive policy D policy makers are most likely to end quantitative easing 8 Classical economists might say that federal budgets have built in stabilizers such as A a progressive tax system B jobless claims C both a and b D the ability to sell assets 11 Most of the United States Federal Govenments debt is owned by A China B intergovernmental agencies C jet lag D TARP E Donald Trump

Consumer wealth is an asset that can not be recovered once spent. Thus it is not a source of income and will not be creating any aggregate demand out of it.
ANSWER : FALSE

7. Slowing down of n economy or an economy prevailing to the right of cycle peak implies that the economy is running through recession. Thus as a result, the economy is suffering from lack of money supply. Hence to increase money upply an expansionary fiscal policy is to be implimented.
ANSWER : (A)
A contractionary policy and a restrictive policy is implimented when the economy is running through inflation and suffering from increase in money supply. Hence B & C are incorrect.
Quantitative easing is a process when central bank purchases government bond so that money supply increases. This is a expansionary policy. But ending easing implies decreasing money supply which is not evidable for an economy suffering through recession. Hence D is incorrect.

8. Under federal budget, a progressive tax system is adopted which incurs a good revenue to the government.
ANSWER : (A) progressive tax system
Ability of selling asset is independent of federal budget because this tool is used to increase money supply.

11. Most of the debt is owned by China, its about 1.1 trillion dollar.
ANSWER : China
Holding of debt for rest of the options are lesser than China and hence are incorrect.