Question 1

Returns to scale examines the production function in the:

Accepted Answer

A)  Short-term
B)  Medium term
C)  Long term
D)  Quinquinial C

Question 2

If marginal propensity to consume is 0.8, the value of multiplier will be:

Accepted Answer

A)  1
B)  2.5
C)  5
D)  2 C

Question 3

In a horizontal straight line demand curve, the price elasticity of demand is:

Accepted Answer

A)  Unity
B)  Infinity
C)  Zero
D)  Less than one B

Question 4

Keynesian aggregate supply curve is:

Accepted Answer

A)  Perfectly elastic
B)  Perfectly inelastic
C)  Unitary elastic
D)  Parabola

Question 5

A simplified representation of a real situation is called:

Accepted Answer

A)  Theory
B)  Hypotheses
C)  Evidence
D)  Economic Model

Exam 3: Macroeconomics, Production Functions and Keynesian Theory of Economics

Returns to scale examines the production function in the: