Question # 1

In a fixed exchange rate regime, the central bank will intervene by __ pounds to ______ the exchange rate.

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Selling, increase

buying , increase

selling, reduce

both b and c

A natural monopoly has a declining ________ over a large range of output.

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Long run marginal cost

Short run marginal cost

Long run average cost

Long run marginal cost

The business cycle describes fluctuations in output around the.

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Trend path of output

Boom

Recession

Short run fluctuations in output

Polices to reduce unemployment by reducing union power tax cut reduction is unemployment benefit and investment. subsidies are examples of.

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Keynesian polices

Supply side policies

Monetarist policies

Classical policies

In the UK mergers can be referred to the competition commission of they create a firm with _______ of the market.

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15%

20%

25%

30%

Except for taxes to offset ___ taxes are.

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Imperfect competition , popular

Extremality's, distortionary

Inequality, a first best option

Poor health, unnecessary

A competitive firm produces a level of output at which.

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Price is greater than marginal cost

Price equals marginal cost

Price is less than marginal cost

None of the above

The key issues of macroeconomics are

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Unemployment

Inflation

Economic growth

All of the above

In the classical model, potential output can not be increased by

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Monetary growth

Better technology

More capital

higher labour supply

The most important source of wage differentiate are.

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Reginal variation

Unionization

Relative danger

Skills

A supply curve is directly affected by

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Technology

Input costs

Government regulation

All of the above

The single European Act committed_ governments to a ___ in 1992

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European union, single market

Western European, single currency area

European union, single currency area

Western European, single market

If a price increase of good A increases the quantity demanded of good B, then good B is a.

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substitute good

Complementary good

Bargain

Interior good

Adding up the quantities demanded of a good by different people facing the same price gives us the.

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Supply curve

Market demand curve

Demand curve

Market supply curve

Government may contribute to inflationary pressure on account of building up large.

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Numbers of employees

Welfare plans

Budget deficits

Expenditure.

Market failure may arise because of.

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Imperfect competition

Taxation

Externalities

All of the above

Real GNP measures income

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Including non market activities

Adjusted for inflation

Including externalities

Including tax evasion

If the central bank buys financial securities in the open market to increase the monetary base, this is an example of.

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Lender of last resort

Financial intermediation

Open market operations

Financial regulation.

In the economy when a steel producer sells steel to car producer it is regarded as.

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A final good

An intermediate good

an injection

a leakage

In a free market

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Government intervene

Government plan production

Government interfere

Price adjust to reconcile scarcity and desires.

International difference in opportunity costs lead to countries acquiring.

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Comparative advantage

High exchange rates

Trade exchange rates

Trade barriers

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