Question # 1

The liquidity trap occurs when the demand for money

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Is perfectly interest elastic

Is perfectly interest inelastic

Means that an increase in money supply leads to a fall int he interest rate

Means that an increase in the money supply leads to an increase in the interest rate

As long as the principle of diminishing marginal utility is operating any increased consumption of a good.

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Lowers total utility

Produces negative total utility

Lowers marginal utility and therefore total utility

Lowers marginal utility, but may raise total utility.

Why do people keep currency in their pockets when bank deposits pay interest.

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Because banks might steal your money

Because currency is more liquid

Because bank deposits lose value due to inflation

Because bank deposits lose value due to exchange in interest rates.

Why does it make sense in assume that people are rational, if you want to predict their behavior.

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People are not guided by emotions when making decisions

People wheo act in the way that best gets them what they want will tend to repeat that behavior, and will tend to learn from mistakes that they do make

People never make mistakes, and tend to make the correct choices all of the time

People always logically figure out what to do.

Which of the following is a patriarchal value.

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Sympthy

Domination

Cooperation

Love

If the government increase spending and raises taxes by just enough to finance the increase it will.

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Leave output unchagned

Increase output

Reduce output

Increase the MPC

Keynesian economists think general equilibrium is not attained quickly because.

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The real interest rate adjusts slowly

The level of output adjusts slowly

The real wage rate adjusts slowly

The price level adjusts quickly

Capitalism refers to

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the use of markets

Government ownership fo capital goods

Private ownership of capital goods

Private ownership of homes and cars

Allocative efficiency is achieved under which of the following market structures.

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Perfect competition

Monopolistic competition

Oligopoly

Monopoly

A current account surplus implies that

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The country is a net lender to the rest of the world

The country is running a net capital account surplus

Foreign investment in domestic securities is at very low levels

All of the above

Increases in government spending increase interest rates and aggregate output in the ISLM framework this is a ____ shift of the _____ curve.

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Left ward ; LM

Right ; LM

Left ward ; IS

Left ward ; AD

using money as a medium of exchange.

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Requires people to math goods wanted with goods available.

Reduces the range of feasible exchanges in the economy

Inhibits economic transactions

Reduces the need for barter in the economy.

Economic transition involves high inflation because ______ and _____

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High monetary growth, high wages.

High budget deficits, devaluation

High monetary growth, devaluation

Prices surge from an artificially low level to their equilibrium level the inflation tax is required as source of government revenue.

In the circular flow diagram firms.

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Receive revenue and supply resources in the resource market

Incur costs and demand resources in the resource market.

Receive revenue and demand resources in the product market.

Incur costs and supply goods and services in the product market.

If the demand curve for a good is downward sloping then the good must be.

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Normal

Inferior

Giffen

Either a or b

If two sets contains the same number of distinct elements but not the same elements are called.

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Pie diagram

Venn diagrams

Histogram

Ogives

Ordinal measurement approach was not presented by

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Allen

Hicks

Edge worth

Robbins

Which of the following is not a macro economic issue.

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Unempolyment

Inflaction

The wages paid to footballers

Economic growth

Perfect price discrimination means that every customer.

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Buys the same amount

Pays the same price

Pays what she thinks the product is worth

Contributes the same revenue.

Which of the following is NOT characteristics of underdeveloped nations.

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Low per capita income

Low growth rate of GNP

General needs for substantive investment in the infrastructure

Low population growth rates

A decline in the money__________ shifts the LM curve to the ____ causing the interest rate to rise and output to fall.

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Demand ; right

demand ; left

supply ; right

supply ; left

A single value that represent the average characteristics of tis frequency distribution.

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quarterlies

Grouped data

Central tendency

Range

All of the following are parts of the business cycle except.

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Boom

slump

Recovery

Acceleration

A fall in interest rates is likely to

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Increase aggregate demand

Increase savings

Decrease consumption

Decrease exports

What characteristic does statistics emphasizes, as a Method or as a singular noun.

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Descriptive

Analytical

Inferential

Comparative

The difference between what consumers have to pay for a particular and what they are willing to pay is known as.

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Consumer surplus

Producer surplus

Dead weight costs

Dead weight surplus

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

Fiscal defect in the budget means.

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Revenue Deficit plus the net borrowings of the government.

Budgetary deficit plus the net borrowings of the government

Capital deficit plus revenue deficit

Primacy deficit minus capital deficit

The movement to free international trade is most likely to generate short term unemployment in which industries'.

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Industries in which there are neither imports nor exports

Import competing industries.

Industries that sell to domestic and foreign buyers

Industries that sell to only foreign buyers

The values are represented by identical symbol or picture's

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Bar charts

Pictograms

Circle charts

graphs

Since 1960 the rage of economic growth in the country has been

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On the decline continuously

Increasing continuously

increasing occasionally.

Static in real terms

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