Ask Question, Ask an Expert


Ask International Economics Expert

problem 1: If nominal GNP increases at a rate of 10 % per year while the GNP deflator increases at 8 % per year, then:

A) Real GNP remains constant
B) Real GNP rises by 10 %
C) Real GNP falls by 8 %
D) Real GNP rises by 2 %

problem 2: Assume that national income is initially at its equilibrium level when desired investment falls. We would expect:

A) A fall in national income, however not by as much as the fall in desired investment.
B) No change in national income even although desired investment spending drops.
C) An increase in national income by an amount equivalent to the reduction in investment spending.
D) A fall in national income by some multiple of the fall in desired investment spending.

problem 3: If the MPC for the economy is 0.8, then:

A) MPS is 1/0.8
B) The multiplier is 4
C) The multiplier is undefined
D) The MPS is 0.2

problem 4: The prevention of main swings in economic activity can be handled most simply by the:

A) Household sector.
B) Business sector.
C) Financial sector.
D) Government sector.

problem 5: Expansionary fiscal policy:

A) Reduces aggregate demand.
B) Takes place when the government takes actions to stimulate the economy.
C) Takes place when the government cuts spending.
D) Takes place when the government reforms the public sector through privatization.


problem 6: Commercial banks make money by:

A) Loaning out pounds they receive as deposits.
B) Printing currency.
C) Collecting bad debts.
D) Earning profits.


problem 7: Assume that Mr. Robinson deposits pounds 600 in currency at a bank. Later that day Ms. Volker borrows pounds 1200 from the same bank. The money supply will have:

A) Raised by pounds 1200.
B) Raised by pounds 600.
C) Reduced by pounds 600.
D) Stayed the same.

Describe how?

problem 8: Assume that the per capita income in Alfaland (with initial high per capita income) is growing faster than it is in Betaland (with initial low per capita income).Then:

A) The real value of the output generated by Alfaland exceeds that of Betaland.
B) The difference in living standards between Alfaland and Betaland remain constant over time.
C) The gap in standard of living among the two countries reduces over time.
D) The gap in the standard of living among the two countries widens over time


problem 9: If the Bank of England wanted to discourage investment spending and decrease aggregate demand, it could:

A) Decrease the required reserve ratio.
B) Sell securities on open market.
C) Lower the discount rate.
D) Buy securities on open market.


problem 10: Assume that the marginal propensity to consume (MPC) is 0.9. Starting from equilibrium, investment demand increases by 50. How much equilibrium income increase?

A) 50
B) 100
C) 250
D) 500

Show the computation and elucidate the mechanism.

International Economics, Economics

  • Category:- International Economics
  • Reference No.:- M91880

Have any Question? 

Related Questions in International Economics

Microeconomicsinstructionsplease use a word processor such

MICROECONOMICS INSTRUCTIONS: Please use a word processor such as Microsoft Word, Apple Pages or OpenOffice for your answers. If you have trouble editing the graphs, you can also sketch them on paper, take pictures of the ...

Bullfollowing is the discussion topic on which your

• Following is the discussion topic on which your response needs to be reviewed. Your original response to this discussion is required to be approximately 150 words long. If you pay attention to many of the products and ...

1 list out agenciesfunds noticed by government of india for

1. List out agencies/funds noticed by government of India for the purpose of deemed export benefits. 2. What is the problem of International Liquidity? In what manner this problem has been solved by IMF?   3. What are th ...

Assignmenta textile manufacturer is closing its north

Assignment A textile manufacturer is closing its North Carolina plant and moving the production of its products to a developing nation in Southeast Asia. The primary reason for the move is the lower labor cost that the o ...

1 what do we mean by economies of scale2 what are internal

1. What do we mean by economies of scale? 2. What are internal economies of scale? What are external economies of scale? 3. What is learning by doing (LBD)? What are LBD spillovers? 4. In medieval Europe, the production ...

1this is your assignment 1 your essay questions should be

1.This is your assignment #1 ...Your essay questions should be answered in a short essay format form, no less than a full page of writing content per question, at least 300 words minimum. (each question is worth 5 points ...

Assignmentflying fish specializes in shipping fresh seafood

Assignment Flying Fish specializes in shipping fresh seafood up and down the coast. To improve service, the company wants to develop an in-house application called 53 (Super Shipping System). When 53 is operational, ship ...

Economics assignmentdevelop a 1750-word analysis of the

Economics Assignment Develop a 1,750-word analysis of the international economy in which you do the following: • Analyze measures of economic growth, and comparative and absolute advantage in international trade for the ...

Chapter 3- read chapter 3 write detailed answers to end of

Chapter 3 - Read Chapter 3. Write detailed answers to end of chapter Questions for Discussion numbers 2 and 5. - View on YouTube: BBC - South Korea as a Place to do Business in Scrutiny (Oct 6; 3:40 minutes) Why is doing ...

Developing economies1 why are some countries today much

Developing Economies 1. Why are some countries today much poorer than other countries? Are today's poor countries destined to always be poorer than today's rich countries? If so, explain why. If not, explain how today's ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

A cola-dispensing machine is set to dispense 9 ounces of

A cola-dispensing machine is set to dispense 9 ounces of cola per cup, with a standard deviation of 1.0 ounce. The manuf

What is marketingbullwhat is marketing think back to your

What is Marketing? • "What is marketing"? Think back to your impressions before you started this class versus how you

Question -your client david smith runs a small it

QUESTION - Your client, David Smith runs a small IT consulting business specialising in computer software and techno

Inspection of a random sample of 22 aircraft showed that 15

Inspection of a random sample of 22 aircraft showed that 15 needed repairs to fix a wiring problem that might compromise

Effective hrmquestionhow can an effective hrm system help

Effective HRM Question How can an effective HRM system help facilitate the achievement of an organization's strate