A. be reduced
B. not be affected
C. fall to zero
D. be increased
Related Mcqs:
- For the United States suppose the annual interest rate on government securities equals 8 percent while the annual inflation rate equals 4 percent, For Switzerland the annual interest rate on government securities equal 10 percent while the annual inflation rate equals 7 percent the above variables would cause investment funds to flow from ?
A. the United States to Switzerland causing the dollar to depreciate
B. the United States to Switzerland causing the dollar to appreciate
C. Switzerland to the United States causing the franc to depreciate
D. Switzerland to the United States causing the franc to appreciate - For the United States suppose the annual interest rate on government securities equals 12 percent while the annual inflation rate equals 8 percent For Japan the annual interest rate on government securities equals 10 percent while the annual inflation rate equals 5 percent the above variables would cause investment funds to flow from ?
A. The United States to Japan causing the dollar to depreciate
B. The United States to Japan causing the dollar to appreciate
C. The Japan to United States, causing the dollar to depreciate
D. The Japan to United States, causing the dollar to appreciate - Suppose the government increases its purchases by Rs16 billion. If the multiplier effect exceeds the crowding out effect, then ?
A. The aggregate supply curve shifts to the right by more than Rs 16 billion
B. The aggregate demand curve shifts to the left by more than Rs 16 billion
C. The aggregate demand curve shifts to the right by more than Rs 16 billion
D. the aggregate supply curve shifts to the left by more than Rs 16 billion - If the nominal interest rate is 7 percent and the inflation rate is 3 percent, then the real interest rate is ?
A. 4 percent
B. 10 percent
C. -4 percent
D. 3 percent
E. 21 percent - By financial crowding out economist mean ?
A. credit rationing
B. government borrowing drives up interest rates
C. Bank of England controls on commercial bank lending
D. what the government borrows cannot be used for private investment - The quantity theory of money says that changes in ____lead to equivalent changes in ____ but have no effect on ______?
A. prices, wages, output and employment
B. output prices, employment
C. nominal money, the price level, output and employment
D. nominal money output prices - Keynes liquidity preference theory of the interest rate suggests that the interest rate is determined by ?
A. aggregate supply and aggregate demand
B. the supply and demand for loanable funds
C. the supply and demand for money
D. the supply and demand for labor - When money demand is expressed in a graph with the interest rate on the vertical axis and the quantity of money on the horizontal axis an increase in the interest rate ?
A. None of these answers
B. decrease the quantity demanded of money
C. increase the quantity demanded of money
D. decreases the demand for money
E. increases the demand for money - If inflation is 8 percent and the real interest rate is 3 percent, then the nominal interest rate must be ?
A. 3/8 percent
B. 5 percent
C. 11 percent
D. 24 percent - Assume there is no government or foreign setor, If the MPC is 75 a Rs20 million decrease in planned investment will cause aggregate output to decrease by ?
A. Rs80 million
B. Rs20 million
C. Rs 15 million
D. Rs26.67 million
