(A) AS: fully horizontal; AD: downward sloping
(B) AS: horizontal only till the full capacity level; AD: downward sloping
(C) AS: vertical; AD: upward sloping
(D) AS: horizontal; AD: vertical
Category: Economics Mcqs
Users will find here Economics Mcqs for NTS, CSS, PMS, PPSC, FPSC, KPPSC, AJKPSC, BPSC, PTS, SPSC, Lecturer and all other types of Competitive Exams and Interviews. Economics students can prepare their Economics Portion for all test from here.
Say’s law states that:
(A) Supply creates its own demand.
(B) Demand creates its own supply.
(C) There is no such things as a free lunch
(D) Macroeconomic policy activism is essential to ensure full-employment.
A group of modern economists who believe that markets clear very rapidly and that expanding the money supply will always increase prices rather than employment are the?
(A) New-Keynesians.
(B) Keynesians.
(C) Monetarists.
(D) The Classical school.
Neo-Classical theories were an attempt to explain?
(A) how unemployment could have persisted for so long during the Great
Depression.
(B) the stagflation of the 1970s.
(C) why policy changes that are perceived as permanent have more of an
impact on a person’s behaviour than policy changes that are viewed as
temporary.
(D) the increase in the growth rate of real output in the 1950s.
The hypothesis that people know the ‘true model’ of the economy and that they use this model and all available information to form their expectations of the future is the?
(A) rational-expectations hypothesis.
(B) active-expectations hypothesis.
(C) atic-expectations hypothesis.
(D) adaptive-expectations hypothesis.
Rapid increases in the price level during periods of recession or high unemployment are known as?
(A) slump.
(B) stagnation.
(C) stagflation.
(D) inflation.
Keynes’ explanation for low firm investment during the Great Depression?
(A) low savings, which placed a constraint on investment
(B) high real borrowing rates, which discouraged firm borrowing
(C) high savings, which left consumers with less money to spend on goods
and serviced produced by firms
(D) A permanent change in Europe’s corporate ownership structures.
Monetarism became popular because it was able to, unlike Classical or Keynesian economics, explain?
(A) stagflation in the late 1970s.
(B) demand-pull inflation in the 1960s.
(C) low growth rates in the 1950s.
(D) the prolonged existence of high unemployment during the Great
Depression.