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1. Multiple Choice: Which of the following is not a component of the Aggregate Demand (AD) curve? a) Consumer Spending b) Investment Spending c) Net Exports d) Stock Market Index Answer: d) Stock Market Index Rationale: The AD curve represents the total spending on goods and services in an economy at a given price level and includes consumer spending, investment spending, government spending, and net exports. The stock market index is not a direct component of AD. 2. True/False: The Phillips Curve illustrates an inverse relationship between inflation and unemployment. Answer: True Rationale: The Phillips Curve suggests that there is a trade-off between inflation and unemployment, with lower unemployment rates typically associated with higher rates of inflation. 3. Fill-in-the-blank: The term "
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