Starting from a position of internal and external balance a reduction in aggregate demand will cause a current account ?

Related Mcqs:

1. Starting from a position where the nation’s money demand equals the money supply and its balance of payments is in equilibrium economic theory suggests that the nation’s balance of payments would move into a surplus position if there occurred in the nation a (an) ?

   A. increase in the money demand
   B. decrease in the money demand
   C. increase in the money demand
   D. None of the above

2. Starting from a position where the nation’s money demand equals the money supply and its balance of payments is in equilibrium its balance of payments would move into a surplus position if there occurred in the nation a (an) ?

   A. decrease in the money supply
   B. increase in the money supply
   C. decrease in the money demand
   D. None of the above

3. The Phillips curve is an extension of the model of aggregate supply and aggregate demand because, in the short run, an increase in aggregate demand increase price and ?

   A. decreases unemployment
   B. decrease growth
   C. increases unemployment
   D. decreases inflation

4. If the economy is at the peak of the business cycle, aggregate demand ____ unemployment _______ inflation _______ and the current account of the balance of payments is likely to move towards _______?

   A. rise; falls; rise; deficit
   B. falls; rises; falls; surplus
   C. falls; falls; falls; surplus
   D. is static; low; rises; deficit

5. If the economy is in the though phase of the business cycle, aggregate demand ____ unemployment ______ inflation ______ and the current account of the balance of payments is likely to move towards ________?

   A. falls; falls; falls; surplus
   B. falls; rises; falls; surplus
   C. is static; low; rises; deficit
   D. rises; falls; rises; deficit

6. If the economy is in the recessionary phase of the business cycle, aggregate demand ___ unemployment ____ inflation ___ and the current account of the balance of payments is likely to move towards ____?

   A. falls; falls; falls; surplus
   B. is static; low; rises; deficit
   C. falls; rises; falls; surplus
   D. rises; falls; rises; deficit

7. The difference between the balance on current account and the balance on capital account is the ?

   A. statistical discrepancy
   B. balance of payments
   C. balance of trade
   D. trade deficit

8. According to the model of aggregate supply and aggregate demand in the long run an increase in the money supply should cause ?

   A. Prices to rise and output to rise
   B. Price to fall and output to remain unchanged
   C. Prices to fall and output to fall
   D. prices to rise and output to remain unchanged

9. When aggregate supply exceeds aggregate demand ?

   A. Business inventory accumulate
   B. Unemployment exists
   C. Price of consumer goods rise
   D. People save more than they intended to save

10. In the model of aggregate demand and aggregate supply, the initial impact of an increase in consumer optimism is to ?

    A. shift the short-run aggregate supply curve to the left
    B. shift the aggregate demand curve to the right
    C. shift the short-run aggregate supply curve to the right
    D. shift the aggregate demand curve to the left