Question # 1

The AD schedule indicates that______ inflation is associated with______ output.

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higher , lower

Higher , higher

Lower , lower

zero ,zero

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

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

In an economy, measuring total value (1) added, total value(2) spending on final goods and 3 total factor earning gives the result that.

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3>2>1

3 +2>1

3<2<1

Any measure can be larger or smaller than any other

Extremality's arise because there is a divergence between ____ and _

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Private costs, private benefits

Private costs, social costs of benefits

Social cost, social benefit

Insiders, outsiders

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

An increase in consumer income will increase demand for a __________ for decrease demand for a.

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Substitute good interior good

Normal good, interior good

Interior good, normal good.

Normal good, complementary good.

When real income increases, other things equal we fan expect the demand for real money holdings to.

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Fall

Not change

Increase

Decrease

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

When we know the quantity of a product that buyers wish to purchases at each possible price we know.

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Demand

Supply

excess demand

Excess supply

a demand curve can shift because of changing.

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Incomes

Prices of related goods

Testes

All of the above

Marginal revenue is the ________ when output is.

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Change in average revenue, inversed.

change in total revenue, increased by one unit

change in average revenue, increased by one unit

Change in total revenue, incresed.

In the UK under a _________ of the labour force belong to a trade union.

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Quarter

Third

Half

Three quarters

Expansionary fiscal policy in the classical model will cause aggregate demand to ______ potential output.

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Exceed

Fall below

Fluclaute around

Remain equal to.

Moral Hazard means that the act of insuring __________ that the desired outcome will occur.

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Reduces the likelihood

Increase the likelihood

Guarantees

None of the above

A production technique is technically efficient if.

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Output is maximized

Input are minimized

there is no way to make a given output using less of one input and no more of the other inputs.

costs are minimized

The business cycle is not transmitted from one country to another through.

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Private sector imports and exports

Economic policy

The duration of compulsory education

Labour supply changes

On a graph a positive linear relation ship.

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Moves down to the right

Moves up to the left

Moves up to the right

Modes down to the left

When the S/L exchange rate rises the pounds______ and whent he S/L rate falls the pounds.

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depreciates, appreciates

revalues, devalues

appreciates, deprecates

becomes more expensive, becomes cheaper

Market failure may arise because of.

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Imperfect competition

Taxation

Externalities

All of the above

The real value can be derived from a nominal value by

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Adjusting changes over time

Adjusting for data collection errors

Adjusting for population changes

Adjusting for changes in prices

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