ECO401 questions solved by Naveed
K@sh Again
Which of the following is not a reason why the aggregate demand curve slopes downward?
Select correct option:
The exchange-rate effect
The wealth effect.
The classical dichotomy/monetary neutrality effects.
The interest-rate effect
Question # 6 of 15 ( Start time: 02:41:04 PM ) Total Marks: 1
If diminishing marginal utility holds, and a person consumes less of a good, then all else being equal:
Select correct option:
The price of the good will rise.
Marginal utility will rise
Expenditure on the good will increase
Marginal utility will decline
An important difference between the approaches of the classical and Keynesian economists use to achieve a macroeconomic equilibrium is that:
Select correct option:
Keynesian economists actively promote the use of fiscal policy; the classical economists do not
Keynesian economists actively promote the use of monetary policy to improve aggregate economic performance; classical economists do not
classical economists believe that monetary policy will certainly affect the level of output; Keynesians believe that money growth affects only prices
classical economists believe that fiscal policy is an effective tool for achieving economic stability; Keynesians do not
reason: JIN I m not sure about it but in my point of view frist option should b right because kainsians economists were in faver of government interruption and fiscal policy is also made by government . but u can say it is not more that my TUKKA
In Keynesian economics, equilibrium can occur:
Select correct option:
Only at full employment.
Only at levels less than full employment.
Only at levels greater than full employment.
At any level of aggregate output equal to aggregate expenditures.
Reason ; can’t explain
Question # 1 of 15 ( Start time: 02:34:38 PM ) Total Marks: 1
Which of the following events shifts the short-run aggregate supply curve to the right?
Select correct option:
A decrease in the money supply
A drop in oil prices
An increase in government spending on military equipment
An increase in price expectations
Reference: by the definition of aggregate supply we know that it is the total value of products that firms of economy r willing to produce and this will may increase by their expectations about increasing price
Question # 2 of 15 ( Start time: 02:36:15 PM ) Total Marks: 1
Which of the following is not a reason why the aggregate demand curve slopes downward?
Select correct option:
The exchange-rate effect
The wealth effect.
The classical dichotomy/monetary neutrality effects.
The interest-rate effect
Question # 4 of 15 ( Start time: 02:38:45 PM ) Total Marks: 1
Due to capacity constraints, the price elasticity of supply for most products is:
Select correct option:
The same in the long run and the short run.
Greater in the long run than in the short run.
Greater in the short run than in the long run.
Too uncertain to be estimated.
Reason : in long run firms can increase their capacity so in long run price elasticity of supply is greater in long run
Question # 5 of 15 ( Start time: 02:40:17 PM ) Total Marks: 1
The trend of unemployment over the last forty years is:
Select correct option:
A decrease in unemployment.
It has remained largely unchanged.
An increase in unemployment.
It is too difficult to tell so don't bother.
Reason : unemployment was at its peak in the year 1930 that was the time of great deprecation and it is told by SIR ALI ABBAS in the lectures about unemployment that unemployment after the time of great detraction is goes on decreasing til now
Question # 6 of 15 ( Start time: 02:41:04 PM ) Total Marks: 1
If diminishing marginal utility holds, and a person consumes less of a good, then all else being equal:
Select correct option:
The price of the good will rise.
Marginal utility will rise
Expenditure on the good will increase
Marginal utility will decline
Question # 7 of 15 ( Start time: 02:42:12 PM ) Total Marks: 1
A nation's balance of payments can be affected by changes in:
Select correct option:
Foreign income.
The differential between domestic and foreign interest rates.
The real exchange rate.
All of the given options.
Reason: because payment r made in form of foreign exchange so if the value of nation’s currency increases or decreases with respect to foreign exchange it causes change in exchange rate and also effect the balance of payments
Question # 8 of 15 ( Start time: 02:43:42 PM ) Total Marks: 1
In the Keynesian cross model, the 45-degree line has a slope of:
Select correct option:
1.
0.
45.
Infinity.
Reason: because sloop of 45 line is always equal to 1
Question # 9 of 15 ( Start time: 02:45:24 PM ) Total Marks: 1
At the equilibrium price:
Select correct option:
There will be a shortage
There will be neither a shortage nor a surplus
There will be a surplus
There are forces that cause the price to change
Reason : equilibrium is a condition when supply of something becomes equal to its demand. So at that state there will be neither a shortage nor a surplus
Question # 10 of 15 ( Start time: 02:45:56 PM ) Total Marks: 1
The unemployment rate is equal to :
Select correct option:
Number of employed persons / labour force x 100.
Number of unemployed persons + labour force.
(Number of unemployed persons / labour force) x 100.
None of the given options.
Reference : this formula is given in our handouts in unemployment lectures
Question # 11 of 15 ( Start time: 02:47:05 PM ) Total Marks: 1
An important difference between the approaches of the classical and Keynesian economists use to achieve a macroeconomic equilibrium is that:
Select correct option:
Keynesian economists actively promote the use of fiscal policy; the classical economists do not
Keynesian economists actively promote the use of monetary policy to improve aggregate economic performance; classical economists do not
classical economists believe that monetary policy will certainly affect the level of output; Keynesians believe that money growth affects only prices
classical economists believe that fiscal policy is an effective tool for achieving economic stability; Keynesians do not
reason: JIN I m not sure about it but in my point of view frist option should b right because kainsians economists were in faver of government interruption and fiscal policy is also made by government . but u can say it is not more that my TUKKA
Question # 12 of 15 ( Start time: 02:48:35 PM ) Total Marks: 1
Profit is maximized when:
Select correct option:
Marginal revenue product is greater than marginal input cost
Marginal revenue product equals marginal input cost
Marginal revenue product is less than marginal input cost
Output is maximized
REASON: any frims profit maximaizes when MC=MR . graphically it is the point at which MC curve touches MR curve
Question # 13 of 15 ( Start time: 02:49:52 PM ) Total Marks: 1
In Keynesian economics, equilibrium can occur:
Select correct option:
Only at full employment.
Only at levels less than full employment.
Only at levels greater than full employment.
At any level of aggregate output equal to aggregate expenditures.
Reason ; can’t explain
Question # 14 of 15 ( Start time: 02:51:20 PM ) Total Marks: 1
A price taker is:
Select correct option:
A firm that accepts different prices from different customers.
A monopolistically competitive firm.
A firm that cannot influence the market price.
An oligopolistic firm.
Reason : there exists two types of firms in market one Is price maker that can influence price and other is price taker that has to accept the price prevailing in market
Question # 15 of 15 ( Start time: 02:52:56 PM ) Total Marks: 1
If firms in a competitive industry are experiencing losses in the short run, then:
Select correct option:
The firms will try to raise prices.
Some firms will choose to shut down.
The industry will cease to exist.
New firms will enter the industry.
Reason : the firm will try to increases its prices because it has no other option due to the reason of short run. Firm can’t shut down because it is short run .
Note
Dear fellows I m not sure about the accuracy of my solved quiz. I tried my level best to solve it but if somebody find mistakes in it then plz reply it .
--
JIN
"روشنی" Roshni
Which of the following is not a reason why the aggregate demand curve slopes downward?
Select correct option:
The exchange-rate effect
The wealth effect.
The classical dichotomy/monetary neutrality effects.
The interest-rate effect
Question # 6 of 15 ( Start time: 02:41:04 PM ) Total Marks: 1
If diminishing marginal utility holds, and a person consumes less of a good, then all else being equal:
Select correct option:
The price of the good will rise.
Marginal utility will rise
Expenditure on the good will increase
Marginal utility will decline--
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