A. shift the aggregate supply curve to the right
B. shift the aggregate supply curve to the left
C. shift the aggregate demand curve to the left
D. shift the aggregate demand curve to the right
Economics Mcqs
Fiscal policy is weak under floating exchanges rates as fiscal expansion ?
A. crowds out imports
B. crowds out public consumption
C. crowds out exports
D. reduces the budget deficit
Suppose a wave of investor and consumer pessimism in the USA causes a reduction in spending If the US federal Reserve (Which has a broader remit than the Bank of England Which is charged only with controlling inflation) chooses to engage in activist stabilization policy it should ?
A. Increase government spending and decrease taxes
B. decrease the money supply
C. decrease government spending and increase taxes
D. decrease interest rates
The main features of the European Monetary system are ?
A. The ECU
B. currency swap agreement between member
C. the exchange rate mechanism
D. all of the above
If the marginal propensity of consume MPC is 0.75 the value of the multiplier is ?
A. 4
B. 7.5
C. 5
D. 0.75
The single European Act committed …….. governments to a …….. in 1992?
A. European union, single market
B. Western European, single currency area
C. European Union, single currency area
D. Western European, single market
Suppose a wave of investor and consumer optimisms has increased spending so that the current level of input exceeds the long-run natural rate If policy makers choose to engage in activist stabilization policy they should ?
A. decrease government spending Which the shifts the aggregate demand curve to the left
B. decrease taxes, which shifts the aggregate demand curve to the right
C. decrease taxes, which shifts the aggregate demand curve to the left
D. decrease government spending which shifts the aggregate demand curve to the right
A monetary union means …….., …….. and ……..?
A. permanently fixed capital movements floating exchange rates a fixed structure of interest rates
B. permanently fixed exchange rates, free capital movements, a single interest rates
C. a common currency a single central bank, common monetary policy
D. a common currency floating exchange rates common monetary policy
Which of the following statements regarding taxes is correct ?
A. Most economists believe that in the short run the greatest impact of a change in taxes is on aggregate supply, not aggregate demand
B. An increase in taxes shifts the aggregate demand curve to the right
C. A decrease in taxes shifts the aggregate supply curve to the left
D. A permanent change in taxes has a greater effect on aggregate demand than a temporary change in taxes.
The Maastricht criteria for entry to the EMU are that applicants should have ?
A. low inflation
B. low interest rates
C. stable nominal exchange rates
D. budget deficits and government debt under control
E. all of the above