Ask Question, Ask an Expert

+61-413 786 465

info@mywordsolution.com

Ask Macroeconomics Expert

problem 1: John Maynard Keynes argued that the basic problem which led to the world depression was:

a) Inadequate demand for goods and services. 
b) The shortage of goods and services. 
c) Negative net exports on goods and services. 
d) Decreasing supply of goods and services.

problem 2: When an economy is producing a level of output that is higher than the equilibrium level, planned expenditures ________ total output and ________ goods and services are being generated than are being demanded.

a) Exceed; fewer
b) Are less than; more 
c) Are less than; fewer
d) Exceed; more

problem 3: When the consumption function is C = 25 + 0.9y and income rises by $100, then consumer spending will rise by:

a) $10.
b) $25.
c) $90.
d) $115.

problem 4: Assume that Ca = 40, MPC = 0.8, I = 10. Equilibrium income is:

2057_equilibrium income.jpg

a) 40.
b) 50.
c) 250.
d) 400.

problem 5: If MPC = 0.75, then the government spending multiplier would be:

a) 0.25.
b) -7.5.
c) 4.
d) 25.

problem 6: The tax multiplier is negative as:

a) Increases in taxes decrease disposable personal income and lead to the reduction in consumption spending. 
b) Taxes always have a negative impact on economy. 
c) Tax rates are inversely related to the tax revenues. 
d) Rises in consumption spending have a negative impact on the tax revenues.

problem 7: When firms receive an economic forecast predicting future raises in the growth of real GDP, they are likely to respond through:

a) Raising their level of investment spending to raise current production capacity. 
b) Raising their level of investment spending to raise future production capacity. 
c) Reducing their level of investment spending to reduce future production capacity. 
d) Reducing their level of investment spending to reduce current production capacity.

problem 8: If you wish for to purchase a new sports car in four years for $75,000, how much would you require having in your bank account now, so after four years you will have $75,000 to buy the car? Suppose that your bank pays 6 percent interest.

a) $51,226
b) $59,408
c) $60,484
d) $70,755

problem 9: Assume that you have $400 and the inflation rate is 5 percent. In order to earn a real return of $16 on your investment, the nominal interest rate requires being near:

a) 0 percent.
b) 4 percent.
c) 6 percent.
d) 9 percent.

problem 10: When a firm wants to finance a new project, it can get financing by:

a) Employing its retained earnings.
b) Selling corporate bonds to public. 
c) Issuing and selling new shares of stock.
d) All the above.

problem 11: Financial intermediaries decrease risk by:

a) Gaining expertise in evaluating and monitoring the investments. 
b) Investing in a big number of projects with independent returns. 
c) Investing in a small number of projects with independent returns. 
d) Limiting the diversity of their investment portfolios.

problem 12: In the ________ increases in the supply of money will ________.

a) Short run; increase total demand and output.
b) Short run; reduce total demand and output. 
c) Long run; lead to lower prices 
d) Long run; increase total demand and output.

Macroeconomics, Economics

  • Category:- Macroeconomics
  • Reference No.:- M9453

Have any Question? 


Related Questions in Macroeconomics

Question there is a buyer and a seller the buyer has a

Question: There is a buyer and a seller. The buyer has a valuation 40 for a usable product. The seller has a cost 0 of producing a bad product and a cost 20 of producing a good product. The sequence of events is as follo ...

Question competitive firms located in lesotho africa sell

Question: Competitive firms located in Lesotho (Africa) sell their tube socks only in Europe and theUnited States (which do not produce the good themselves). The industry's supply curve isupward sloping. a. Show the init ...

Question janes juice bar has the following cost schedules

Question: Jane's juice bar has the following cost schedules: quantity variable cost total cost 0 vats of juice 0 30 1 10 40 2 25 55 3 45 75 4 70 100 5 100 130 6 135 165 a. calculate average variable cost, average toal co ...

Question - a 1000 utility bond with 14 years remaining

Question - A $1000 utility bond with 14 years remaining before maturity can now be purchased for $760. It pays interest of $20 each 6-month period. What rate of return is earned by purchasing the bond at the current mark ...

Question you do not need to have seen the movie the

Question: You do not need to have seen the movie, the question is based on Carl Menger's Theory of the Good. In the movie, "Cast Away," Tom Hanks played the character Chuck Noland, who was stranded on a deserted island f ...

Question use an internet search or the university library

Question: Use an internet search or the University Library to locate information on the Consumer Price Index (CPI). Internet sites you might find useful include the Bureau of Labor Statistics (BLS) and the Federal Reserv ...

Question - suppose an economy is described by the following

Question - Suppose an economy is described by the following aggregate demand and short-run aggregate supply curves. The potential level of output is $10 trillion. Aggregate Quantity of Goods and Services Price Level Dema ...

Question pepsico produces both a cola and a major brand of

Question: PepsiCo produces both a cola and a major brand of potato chips. Coca-Cola produces only drinks. When might it make sense for PepsiCo to divest its potato chip operations? For Coca-Cola to begin manufacturing sn ...

Assignment 1 this assignment will enable you to apply the

Assignment 1: This assignment will enable you to apply the determinants of supply and demand, market equilibrium, and price elasticity for a product This assignment will cover the following course outcomes: Describe and ...

Question 1 suppose the marginal propensity to consume is 06

Question: 1. Suppose the marginal propensity to consume is 0.6, the marginal tax rate is 0.25, and the the marginal propensity to import is 0.2. What is the multiplier? 2. Suppose that in the economy described in the pre ...

  • 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

Why might a bank avoid the use of interest rate swaps even

Why might a bank avoid the use of interest rate swaps, even when the institution is exposed to significant interest rate

Describe the difference between zero coupon bonds and

Describe the difference between zero coupon bonds and coupon bonds. Under what conditions will a coupon bond sell at a p

Compute the present value of an annuity of 880 per year

Compute the present value of an annuity of $ 880 per year for 16 years, given a discount rate of 6 percent per annum. As

Compute the present value of an 1150 payment made in ten

Compute the present value of an $1,150 payment made in ten years when the discount rate is 12 percent. (Do not round int

Compute the present value of an annuity of 699 per year

Compute the present value of an annuity of $ 699 per year for 19 years, given a discount rate of 6 percent per annum. As