Question # 1

An upward shift in marginal cost ___________ output and an upward shift in _____ marginal revenue __ output.

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Reduce , reduce

Reduce , increase

Increased, increased

Increases, reduces

The imposition of a tariff causes consumption to _______ and imports to.

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rise , rise

fall , rise

fall , fall

rise , fall

If desired spending in the economy exceeds income we would expect.

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House hold to save more

Firm to produce less

Firms is produce more

the MPC to change

If the income tax rate changes from 30% to 40% on incomes over L 30,000 and a person's income is l 31,000 then her marginal tax rate is.

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30%

10%

70%

40%

Normative economics form ______ based on.

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Positive statements facts

Opinions, personal values

Positive statements values

Opinions facts

The multiplier tells us how much __________ chagnes after a shift in.

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Consumption, income

Investment , output

Savings, investment

output, aggregate demand

Skilled labour is relatively scarce because.

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There are too few teachers

Too few student places in higher education

It is costly to acquire human capital

Teachers salaries are too low

Aggregate demand in an economy trading internationally with a government sector can be written s.

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AD = C+1

AD = C + 1+ G

AD = C +1+G+X+Z

AD+C+1+G+X-Z

An advocate of the classical model of the economy would claim that unemployment a created when the ___________ is above its equilibrium level in the.

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Price level, agregate economy

Tax rate, government ebudget

Wage rate, labour market

Interest rate, market for loanable funds

Taxes create a wedge between the sales price and purchase price that prevents the price system equaling _________ and

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Marginal costs, marginal benefits

Demand, supply

Marginal cost, marginal revenue

Marginal cost, average cost

A dominant strategy is.

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A winning strategy

A losing strategy

A players best strategy when moving fist

a player's best strategy whatever the strategies adopted by rivals

A straight line diagram can be drawn knowing the _______ and _____

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Vertical axis and horizontal axis

Intercept and slope

Scale and slope

Intercept and scale.

Starting from a balanced budget, for a given tax rate an increase in income will cause the government budget to.

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Move into surplus

Move into deficit

Remain unchanged

None of these

An optimal tariff is one which reduces imports to the level at which ___ equals

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imports , exports

The balance of trade, zero

The demand for currency, the supply of currency

Social marginal cost social marginal benefit

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

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%

The quantity theory of money says that changes in ______ lead to equivalent changes in ______ but have no effect on.

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Prices, wages, output and employment.

Output, prices, employment

Nominal money, the price level output and employment.

Nominal money output prices

The retail price index is used to.

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Construct price lists

Compare shop prices

Measure changes in the cost of living

None of the above

The short run marginal cost curve cuts the short run total cost curve and short run average variable cost curve.

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At their lowest points

When they are declining

When they are increasing.

When marginal revenue is zero

The opportunity cost of a student is.

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Course fees and rent

A loan from the bank

What the student could have earned in the best job available by not studying.

What the student will earn after graduation.

If goods are exported for less than society's marginal production cost and the marginal benefit to domestic consumers, it is likely that they benefit from.

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An import subsidy

A quota

Comparative advantage

An export subsidy

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