Economics Practice MCQ Page 39
Multiple Choice questions for Economics in the sets of 10 each on one page with questions and answers. All sets are useful in the preparation of subject tests for employment or admission.
Question: 3476 In the long run, an unanticipated, one time increase in the money supply leads to
- a proportional increase in prices with no change in output or interest rates
- increase in output and prices but no change in interest rates
- increase in output and prices and a decline in interest rates
- an increase in output but no change in prices or interest rates
- an increase in output , a decline in interest rates, but no change in prices.
Question: 3477 As a result of an unanticipated one time increase in the money supply the aggregate demand curve shifts
- downward only in the short run
- down ward in the short and long run
- downward only in the long run
- upward in the short and long run
- upward only in the short run
Question: 3478 As a result of an unanticipated, one time increase in the money supply the short run aggregate supply curve shifts
- downward only in the short run
- downward in the short and long run
- downward only in the long run
- upward in the sort and long run
- upward only in the long run
Question: 3598 Rational expectations of inflation are formed on the basis of
- all available information about the economy
- only past values of all variables
- only past values of the price level
- present and past values of inflation
- correct predictions of future policies
Question: 3601 An increase in the expected rate of inflation tends to
- increase interest rates and reduce velocity
- decrease interest rates and reduce velocity
- increase interest rates and increase velocity
- decrease interest rates and increase velocity
- increase interest rates and not change velocity
Question: 3602 Supply side inflation works through the effects of increases in
- the money supply
- taxes
- firms costs
- households incomes
- government spending
Question: 3603 A permanent but unexpected, increase in the growth rate of money causes nominal interest rates to
- increase in both the short and long run
- decrease in both the short and long run
- increase in the short run and decrease in the long run
- decrease in the short run and increase in the long run
- decrease in the short run and not change in the long run
Question: 3604 Protracted and sustained inflation is most likely caused by
- fiscal tax cuts
- federal deficit spending
- excess money growth
- an unfavorable trade balance
Question: 3605 The wage /price spiral tends to
- perpetuate inflation only as long inflation is ratified by monetary policy
- cause the rate of inflation to accelerate independent of monetary policy
- perpetuate inflation regardless of monetary policy
- cause accelerating inflation even with constant money growth
- reduce inflation when money growth is very fast
Question: 3607 Monetarists believe in controlling inflation through
- income policies
- restraint in fiscal policy
- slow money growth
- wage/price controls
- combination of the above method
Question: 3609 Monetarists believe in controlling inflation through
- incomes policies
- restraint in fiscal policy
- slow money growth
- wage/price controls
- combination of the above methods
Question: 3611 Compared to monetarists, Keynesians are more concerned about
- the effects of rapid inflation
- high interest rates
- the inefficiencies of wage/price guidelines
- recessions resulting from monetary contraction
- long run growth in the economy
Answers to the questions of Economics on this page
Following list gives the correct choice for the answer of the Economics mcqs.
3476 . A
3477 . D
3478 . E
3598 . A
3601 . C
3602 . C
3603 . D
3604 . C
3605 . A
3607 . C
3609 . C
3611 . D
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