Deck 11: Macroeconomics and Economic Theories

Question 1

The marginal propensity to save is defined as:

A)1-?C/?Y
B)S/Y
C)Y/S
D)Y/?S

Answer 1

1-?C/?Y

Question 2

-------------is associated with the theory of multiplier:

A)Adam Smith
B)Malthus
C)Malthus.
D)Keynes

Answer 2

Keynes

Question 3

The MPC has a value:

A)Greater than one but less than two
B)Less than one but greater than zero
C)Greater than two
D)None of these

Answer 3

Less than one but greater than zero

Question 4

Which of the following is not a stock variable:

A)Vapital
B)Wealth
C)Money supply
D)Saving

Question 5

An official reduction in the value of home currency in terms of foreign currency is known as:

A)Revaluation
B)Devaluation
C)Depreciation
D)Appreciation

Question 6

The value of investment multiplier depends on:

A)APC
B)APS
C)MPC
D)MPS

Question 7

Wage cut as a solution of unemployment in classical theory is suggested by:

A)J
B)Say B. A.C. Pigou
C)Keynes
D)Marshall

Question 8

The word macro was first used in Economics by:

A)Keynes
B)Ragner Frisch
C)J.R. Hicks
D)J.B. Say

Question 9

Personal Disposable income is:

A)Always equal to personal income
B)Always more than personal income
C)Equal to personal income minus direct taxes
D)Equal to personal income minus indirect taxes

Question 10

When the method of Statics is called upon to study a changing process, it is referred to as the method of:

A)Statics
B)Dynamics
C)Comparative statics
D)None of these

Question 11

Leakages are the factors which:

A)Keep the power of multiplier stable
B)Increase the power of multiplier
C)Reduce the power of multiplier
D)Reduce the power multiplier to zero.

Question 12

The phenomenon of increase in money wages that leads to increases in unemployment is shown by:

A)Speculative demand curve
B)Phillip's curve
C)Aggregate supply
D)Income consumption curve

Question 13

Which of the following is Keynesian saving function?

A)S = f(i)
B)S = f(P)
C)S = f (Y)
D)S = f (W)

Question 14

Usually an IS curve is a -------line.

A)Vertical
B)Downward Slopping
C)Horizontal
D)Upward slopping

Question 15

When consumption and income are equal, saving is ------------

A)Negative
B)Positive
C)Zero
D)Increasing

Question 16

When of the following is correct:

A)1/MPS = value of the multiplier
B)1/MPS = Accelerator co-efficient
C)1/MPS = MEC
D)None of these

Question 17

"Treatise on money' is a book written by:

A)Pigou
B)Marshall
C)Robertson
D)Keynes

Question 18

Value of money:

A)Is inversely related to the price level
B)Is directly related to the price level
C)Is independent of the price level
D)None of these

Question 19

The major primary function of money in modern Economics is to serve as:

A)A store of value
B)A medium of exchange
C)A transfer of value
D)A standard fordeferred payments

Question 20

1- C/Y is defined as:

A)Average propensity to consume
B)Marginal propensity co consume
C)Average propensity to save
D)Marginal propensity to save

Question 21

Say's Law of market says:

A)Demand creates supply
B)Supply creates demand
C)Income generates demand
D)Savings create demand in the market.

Question 22

The curve showing the possibilities of production of desired good is known as:

A)Indifference curve
B)Production possibility curve
C)Revealed preference curve
D)None of these

Question 23

Which one of the following definition of Economics is associated with the name of Lionel Robbins?

A)Welfare definition
B)Scarcity definition
C)Growth definition
D)Wealth definition