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Take this quiz! Other things being equal, increased innovation in an economy is likely to lead to a Which one of the following state…
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Take this quiz! Other things being equal, increased innovation in an economy is likely to lead to a Which one of the following statements about saving is correct? As a component of aggregate demand,
Economics
Take this quiz! Other things being equal, increased innovation in an economy is likely to lead to a Which one of the following statements about saving is correct? As a component of aggregate demand,
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Economics
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monik
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1
Other things being equal, increased innovation in an economy is likely to lead to a
fall in the equilibrium level of output.
fall in the size of the labour force.
leftward shift of the aggregate demand curve.
rightward shift of the long-run aggregate supply curve.
2
Which one of the following statements about saving is correct?
Saving is a component of aggregate demand.
Saving can finance investment expenditure.
In the short run, less household saving means less consumption.
Increased saving increases demand-pull inflationary pressure.
3
As a component of aggregate demand, consumption is best defined as total expenditure in the economy
on all goods and services including imports.
on all goods and services minus expenditure on exports.
by households on all goods and services.
by households, government and firms plus expenditure on exports less expenditure on imports.
4
Which one of the following is most likely to shift the short run aggregate supply curve to the right?
A fall in money wages
A reduction in government spending
A fall in the exchange rate
A decrease in the productivity of labour
5
‘The multiplier’ usually refers to the effect of a change in the level of
aggregate demand upon imports.
national income upon aggregate demand.
saving upon investment.
investment upon national income.
6
Expansionary monetary policy is most likely to
shift the long run aggregate supply curve to the left.
result from a reduction in taxation.
cause a surplus on the current account of the balance of payments.
shift the aggregate demand curve to the right.
7
All other things being equal, an economy is most likely to experience inflation if
aggregate supply increases at a faster rate than aggregate demand.
the country runs a balance of trade deficit at full employment.
aggregate demand is increased when the economy is on its production possibility frontier.
the government runs a budget deficit when long run aggregate supply increases.
8
A rise in the level of domestic investment will most likely result from a rise in
the current account deficit.
interest rates.
company profits.
the exchange rate.
9
A sustained rise in the exchange rate is most likely to increase
inflation.
unemployment.
economic growth.
international competitiveness.
10
Which one of the following is most likely to be an example of a contractionary fiscal policy designed to reduce inflationary pressures?
A reduction in the exchange rate
A reduction in the supply of money available to banks for lending purposes
Higher interest rates
An increase in the government budget surplus
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