Question # 1

In land intensive method which mean production is used comparativelymore

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Labour

Land

Capital

Organization

The diamond water paradox can be explained by suggesting that the price of a product is determined by.

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Consumer incomes

Its marginal utility

Consumer surplus

Diminishing marginal utility

If the price elasticity is -0.3 this means.

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Demand is upward sloping

Demand is price elastic

A price fall would increase revenue

Demand is price inelastic

Which of the following is a determinant of consumption.

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Expectations about future prices

Level of indebtedness of consumers

The price level

All of the above

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

Companies in the private sector are owned by

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The government

Shareholders

Employees

The community

In a free market the combination of products produced will be determined by.

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Market forces of supply and demand

The government

The law

The public sector

If demand is price inelastic.

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An increase in price must raise profits

An increase in price decreases revenue

An increase in price increase revenue

A decrease in price reduces sales.

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

In cartels.

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Firms complete against each other

Price wars are common

Firms use price to win market share from competitors

Firms collude

An increase in aggregate demand is more likely to lead to demand pull inflation if.

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Aggregate supply is perfectly elastic

Aggregate supply is perfectly inelastic

Aggregate supply is unit elastic

Aggregate supply is relatively elastic

The marginal propensity to consume in a less Developed Country is likely to be.

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_{Less than 0}

Nearly 0

High

Low

If input price adjusted very slowly to output prices, the Phillip's curve would be.

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Downward sloping

Vertical or nearly vertical

Upward sloping

Horizontal or nearly horizontal

Investment is an out stable element of aggregate demand because is depends heavily on.

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Government policy

Expectations

National income

Historic trends

Injection are

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Assumed to be exogenous

Assumed to be a function of national income

Decrease aggregate demand

Decrease the investment into an economy

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 an increase in investment leads to a bigger increase in national income this is called the.

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Accelerator

Aggregate demand

Monetarism

Multiplier

A contraction in supply occurs when

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Demand shifts out wards

The supply curve shifts inwards

The quantity supplied falls when the price falls

The supply curve shifts outwards

A significant increase in the government budget deficit is likely to.

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Reduce injections into the economy

Reduce national income

Move the economy away from full employment

Boost aggregate demand

According to classical models the level of employment is determined primarily by

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Interest rates

The level of prices

The level of aggregate supply in the economy

The level of aggregate demand for goods and services

Which of the following is not an obvious or direct determinant of a country's imports.

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Real exchange rate

Income

Tariff rates

Interest rate

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