Question # 1

The demand for a product would be more inelastic.

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The greater is the time under consideration

The greater is the number of substitutes available to buyers

The less expensive is the product in relation to incomes

all of the above.

An increase in demand for a product should.

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Increase equilibrium price and quantity.

Decrease equilibrium price and quantity.

Increase equilibrium price and decrease quantity.

Decrease equilibrium price and increase quantity.

A deflationary policy could include

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Increasing injections

Reducing taxation rates

Reducing interest rates

Reducing government spending

Game theory

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Firm are assumed to act independently

Firms are assumed to cooperate with each other

Firm collude as part of a cartel

Firms consider the actions of others before deciding what to do.

The standard of living is often measured by

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Real GDP per capita

Real GDP

Real GDP * Population

Real GDP Plus depreciation

Companies in the private sector are owned by

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The government

Shareholders

Employees

The community

Economists use the term utility to mean

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The value of a product before it has been advertised

The satisfaction a consumer obtains from a good or service

any characteristic of a good or service which cannot be measured

The contribution a good or service makes to social welfare

Free trade is based on the principle of

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Comparative advantage

Comparative scale

Economics of advantage

Production possibility advantage

The law of demand states that.

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As the quantity demanded rises, the price rises.

As the price rises the quantity demanded rises

As the price rises, the quantity demanded falls.

As supply rises, the demand rises.

To reduce cyclical unemployment the government might.

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Increase the budget surplus

Increase the balance of payments deficit

Reduce interest rates

Reduce government expenditure

Profit is measured by

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Revenue - Fixed costs

Fixed cost + revenue

Revenue - sales

Revenues - total costs

As the MPS increases, the multiplier will

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Increase

Either increase or decrease depending on the size of the change in investment

Remain constant

Decrease

To prevent the external value of the currency from failing the government might

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Reduce interest rates

Sell its own currency

Buy its own currency with foreign reserves

Increase its own spending

If injection are less than with drawls at the full employment level of national income there is.

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an inflationary gap

Equilibrium

A deflationary gap

Hyperinflation

If marginal revenue equals marginal cost

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No profit is being made

total revenue equals total cost

Profits are maximized

Producing another unit would increase profits

Aggregate demand refers to the total demand for all domestically produced goods and services in an economy generated from.

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The household and government sectors

The household sector

All sectors except the rest of the world

All sectors including the rest of the world.

If the economy grows the government's budget position will automatically

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Worsen

Improve

Stay the same

Increase with inflaction

If there is a price celling which of the following is NOT likely to occur.

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Rationing by first come first served

Black markets

Gray markets

Sellers providing goods for free that were formerly not free

Sales taxes are generally considered to be.

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Proportional taxes

Regressive taxes

Progressive taxes

Indirect taxes

If the price elasticity of demand for a product in market A is -0.2 and in market B is -3 a price discriminator will charge.

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The higher price in market A

The higher price in market B

The same price in both markets

There are many sellers

The agricultural price support program is an example of.

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A price celling

A price floor

Equilibrium pricing

None of these

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