Engineers for the All-Terrain Bike Company have determined that a 15% increase in all inputs will cause a 15% increase in output Assuming that input prices remain constant, you correctly deduce that such a change will cause ________ as output increases?

Related Mcqs:

1. If input price prices adjusted very rapidly to output prices as classical economists argue the Philips curve would be ?

   A. Vertical or nearly vertical
   B. upward sloping
   C. downward sloping
   D. horizontal or nearly horizontal

2. Suppose there is no tariff on imported inputs and the ratio of the value of imported inputs the value of the final product is 0.5 If the nominal tariff rate on the final product is 10 percent, the effective tariff rate equals ?

   A. 5 percent
   B. 10 percent
   C. 15 percent
   D. 20 percent

3. With _______ prices rise in the first sector, remain the same in the second and increase overall?

   A. ratchet inflation
   B. inflationary expectations
   C. import substitution
   D. demand pull inflation

4. When supply exceeds demand, sellers must lower prices to stimulate sales, when demand exceeds supply, prices increase as buyers compete to buy goods. What this theory is called in economics?

   A. Cost push theory
   B. Supply and Demand theory
   C. Fundamental theory
   D. Ricardo’s theory

5. Total increases from Rs500 to Rs600 when output increases from 20 to 30 units. Fixed costs are Rs200 Which of the following is true ?

   A. Marginal cost is Rs20
   B. Average cost falls
   C. Variable cost rises by Rs100
   D. Average fixed cost is Rs10

6. Suppose the economy is initially in long-run equilibrium Then suppose there is an increase in military spending due to rising international tensions According to the model of aggregate demand and aggregate supply what happens to prices and output in the long run ?

   A. Output falls; prices are unchanged from the initial value
   B. Price fall; output is unchanged from its initial value
   C. Output and the price level are unchanged from their initial values
   D. Prices rise; output is unchanged from its initial value

7. Suppose the economy is initially in long-run equilibrium Then suppose there is an increase in military spending due to rising international tensions According to the model of aggregate demand and aggregate supply what happens to prices and output in the short run ?

   A. Price fall; output rises
   B. Price fall; output falls
   C. Price rise; output fall
   D. Price rise; output rise

8. A group of modern economists who believe that institutional factors and confidence strongly influence business behaviour and that expanding demand will usually increase output rather than prices are the ?

   A. monetarists.
   B. keynesians
   C. post-keynesians
   D. new classical school

9. A change in the relative prices of which of the following pair of goods would likely cause the smallest substitution effect ?

   A. right shoes and left shoes
   B. petrol from BP and petrol from shell
   C. kit-Kat chocolate snacks and Twix chocolate snacks
   D. coke and Pepsi

10. Total increase from Rs500 to Rs600 When output increases from 20 to 30 units Fixed costs are Rs200 Which of the following is true ?

    A. Marginal cost is Rs20
    B. Average cost rises
    C. Variable cost rises by Rs200
    D. Average fixed cost was Rs10originally