Which of these statements about taxes is correct?
Correct answer C. A permanent change in taxes has a greater effect on aggregate demand than a temporary change in taxes
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Economics MCQs
Page 75 of Economics multiple-choice questions with answers. Tap an option to check yourself.
Page 75 of 131
- Miscellaneous Economics 737
- Basic of Economics 430
- Markets, Efficiency And The Public Interest 167
- Agriculture & Irrigation System of Pakistan 126
- Market 87
- Macroeconomic Issues and Analysis 75
- Money, Interest Rates And Output 73
- Introduction To Economics 70
- Population And Development 62
- Profit Maximizing Under Perfect Competition And Monopoly 56
- Income Inequality 52
- Non-Tariff Trade Barriers 48
- Aggregate Supply, Unemployment And Inflation 45
- Natural Resources and the Environment Toward Sustainable Development 44
- Costs , Supply And Perfect Competition 44
- Human Capital 42
- Labour Market 39
- Monopoly 35
- Long Term Economic Growth 30
- Inflation & Productivity 30
- Regional Trading Arrangements 29
- Characteristics and Institutions of Developing Countries 24
- Oligopoly 23
- Consumer Theory vs. Real Consumers 20
- Applied Microeconomics 20
- Alternative Theories Of The Firm 20
- Public Goods 20
- Balance of Payments, Aid and Foreign Investment 19
- Prices, Wages & Taxes 19
- Comparative GDP 19
- Budget Deficits And The Trade Balance 18
- Macroeconomic Policy Tools 18
- Asymmetric Information 17
- Application of Economics 16
- Production Factors 16
- Monopoly & Competition 15
- Capital Formation, Investment Choice, Information Technology, And Technical Progress 15
- Monetary, Fiscal And Incomes Policy, And Inflation 15
- Average And Total Cost 14
- Poverty, Malnutrition, And Income Inequality 12
- Monetary Union 10
Under the Maastricht criteria for joining EMU, what were applicants required to have?
Correct answer E. All of the above
Higher government purchases raise some people’s incomes, and they spend part of that extra income on more consumer goods. What does this illustrate?
Correct answer C. The multiplier effects
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Within Economic and Monetary Union (EMU), how can a member country’s competitiveness change?
Correct answer D. Domestic wage and price adjustment
Which statement about stabilisation policy is NOT true?
Correct answer C. Long lags enhance the ability of policy makers to fine tune the economy
What is meant by an objective in economic policy?
Correct answer D. A target
Which sequence best explains how an increase in the money supply shifts the aggregate demand curve?
Correct answer D. The money supply shifts right, the interest rate falls, investment increases and the aggregate demand curve shifts right
Which of these does the government NOT control directly?
Correct answer B. Firms' investment decisions
On a graph with the interest rate on the vertical axis and the quantity of money on the horizontal axis, what does a rise in the interest rate do?
Correct answer A. Decreases the quantity of money demanded
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Which of these is something the government cannot directly use to control the economy?
Correct answer C. Pay rates within the private sector
For Eurozone countries, what is probably the most important reason the aggregate demand curve slopes downwards?
Correct answer D. The interest-rate effect
Which of these is a possible government objective rather than a policy?
Correct answer D. Lower inflation
What is the immediate effect of an increase in the money supply?
Correct answer D. To decrease the interest rate
The statement ‘Reducing inflation is a more important objective than economic growth’ is an example of what?
Correct answer C. Normative economics
What is the first effect of an increase in government spending?
Correct answer B. Aggregate demand shifts to the right
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How can the labour force be defined?
Correct answer C. Anyone who is working or actively seeking work
What effect does a rise in the marginal propensity to consume (MPC) have?
Correct answer B. It raises the value of the multiplier
How is a person classified if they are not working and have given up looking for work?
Correct answer A. A discouraged worker
Higher government purchases raise incomes, shift money demand to the right, push up the interest rate and reduce investment. What does this sequence demonstrate?
Correct answer A. The crowding-out effect
Which of the following describes cyclical unemployment?
Correct answer C. Unemployment that occurs during recessions and depressions