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PPSC Economics Chapter 11 Assess Your Basics MCQs With Answers
Question # 1
M4 is a _________ measures of money and includes deposits at both _____________ and
Choose an answer
Narrow, banks, building societies
Wide, banks, insurance companies
narrow, banks, insurance companies
Wide, banks, building societies.
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Question # 2
If the MPC is 0.5 the multiplier is
Choose an answer
2
1/2
0.2
20
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Question # 3
Firms are assumed to ____ costs and to _______ profit.
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Incur , desire
Pay ; make
Change ;earn
Minimize ; maximize
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Question # 4
If I keep some money available in case I see a bargain this is an example of.
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Asset demand for money
Transactions demand for money
Token demand for money
Precautionary demand for money
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Question # 5
At the intersection of AD and AS equilibrium is achieved in.
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The goods market
The money market
The labour market
All of the above
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Question # 6
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
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Question # 7
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
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Question # 8
a demand curve can shift because of changing.
Choose an answer
Incomes
Prices of related goods
Testes
All of the above
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Question # 9
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
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Question # 10
A dominant strategy is.
Choose an answer
A winning strategy
A losing strategy
A players best strategy when moving fist
a player's best strategy whatever the strategies adopted by rivals
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Question # 11
The Philips curve shows the trade off between ________ and _____
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The inflation rate, interest rates
The inflation rate, the unemployment rate
interest rates, output
Output, employment
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Question # 12
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.
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Question # 13
One of the transmission mechanism of monetary policy is through consumer house hold wealth.___________ and consumption.
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rise, increases, increases
rise, falls, increases
rise, increases, falls
rise, falls, falls
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Question # 14
The participation rate in the labour force is affected by
Choose an answer
Higher real wages
Lower fixed costs of working
Lower non labor income
All of the above
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Question # 15
If a firm not operating at the output necessary to achieve al scale economies it has not achieved its.
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Efficient scale
Average efficient scale
Maximum efficient scale
Minimum efficient scale
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Question # 16
A competitive equilibrium is Pareto efficient because.
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Producers are price takers
Consumers and producer's face the same prices
Marginal costs and benefits are equal
All of the above
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Question # 17
Short run equilibrium output means that aggregate demand _ actual output
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is less than
equals
is greater than
fluctuates around
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Question # 18
The most important source of wage differentiate are.
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Reginal variation
Unionization
Relative danger
Skills
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Question # 19
The long run Philips curve is _________ at the ______
Choose an answer
Horizontal natural rate of inflation
Horizontal , natural rate of unemployment
Vertical , natural rte of inflation
Vertical , equilibrium rate of unemployment.
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Question # 20
If my neighbor burns garden waste causing my house to fil with smoke this is an example of.
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A production extremality
A second best solution
Transaction costs
A consumption externality
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Question # 21
During periods of rising inflation and rising interest rates we expect the demand for real cash to.
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rise
fall
not change
fluctuate
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