Question # 1

An increase in national income is.

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Likely to increase exports

Likely to decrease savings

Likely to decrease investment

Likely to increase spending on imports

"Reducing inflation is a more important objective than economic growth" is an example of.

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Normative economics

Positive economics

Objective economics

Reality economics

Economic theory assumes that people

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Act in greedy and selfish ways, without regard for the welfare of others.

Act without regard for their own interests.

Are not motivated by self interest

Are motivated by self interest but still might be concerned for the welfare of others.

Economics is the study of.

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All business, including how they operate why the exist and how they afect

Decisions that people must make because goods and services are limited.

How to save money, spend money invest savings, and balance a checkbook

The stock market the bond market and investment strategies

Big business and its impact on our live

Sales taxes are generally considered to be.

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Proportional taxes

Regressive taxes

Progressive taxes

Indirect taxes

In a recession, GDP.

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Grows negatively

Grows by 0%

Grows slowly

Grows rapidly

Laboratory experiments cannot be performed in economics because.

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Of resource scarcity

Economics is a natural science

Of the difficulty of distinguishing between normative and positive statements.

Economics is a social science

The accelerator theory of investment says that induced investments determined by.

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The rate of change of national income

Expectations

The level of national income

The level of aggregate demand

In perfect competation.

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The price equals the marginal revenue

The price equals the average variable cost

The fixed cost equals the variable costs

The price equals the total costs

Any combination of products inside the production possibility frontier is

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Allocatively inefficient

X inefficient

Consumer inefficient

Productively inefficient

In the long run in perfect competition

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Price = average= cost = marginal cost

Price = average cost = total cost

The price covers fixed cost

total revenue = total variable cost

In a recession a government.

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Is likely to want to increase demand in the economy

Is likely to want to decrease demand in the economy

Is likely to want to stabilize demand in the economy

Is likely to want to increase supply in the economy

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.

The price mechanism cannot.

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Act as a signal

Act as an incentive

Act as a rationing device

Shift the demand curve

As income increases.

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the average propensity to consume gets nearer in value to the marginal propensity to consume

the average propensity to consume diverges in value from the marginal propensity to consume

the average propensity to consume falls

The averge propensity to consume always approaches 0

Ordinal measurement approach was not presented by

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Allen

Hicks

Edge worth

Robbins

An increase in price all other things unchanged leads to.

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A shift in supply out wards

A shift in supply in wards

A contraction of supply

An extension of supply

In a command economy

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The price mechanism acts as an incentive

Resources are allocated by market forces

Individual firms make decisions for themselves about what to produce and how to produce it.

The public sector is large

Which of the following is not a global organization?

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IMF

World bank

Competition commission

WTO

If marginal cost is positive and falling.

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Total cost is falling

Total cost is increasing at a falling rate

Total cost is falling at a falling rate

Total cost is increasing at an increasing rate.

If the exchange rate is above the equilibrium level.

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There is excess demand and teh exchange rate will fall

There is excess supply and the exchange rate will fall

There is excess demand and the exchange rate will rise

There is excess supply and the exchange rate will rise

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