Which of the following statements is correct ?

Related Mcqs:

1. Which of the following statements about the burden of a tax is correct ?

   A. The tax burden generated from a tax placed on a good consumer perceive to be a necessity will fall most heavily on the sellers of the good
   B. The burden of a tax falls on the side of the market (buyers or sellers) from which it is collected
   C. The distribution of the burden of a tax is determined by the relative elasticities of determined by legislation.
   D. The tax burden falls most heavily on the side of the market (buyers and sellers) that is most willing to leave the market when price movements are unfavorable to them.

2. Which of the following statements regarding taxes is correct ?

   A. Most economists believe that in the short run the greatest impact of a change in taxes is on aggregate supply, not aggregate demand
   B. An increase in taxes shifts the aggregate demand curve to the right
   C. A decrease in taxes shifts the aggregate supply curve to the left
   D. A permanent change in taxes has a greater effect on aggregate demand than a temporary change in taxes.

3. Which of the following statements is correct ?

   A. none of these answers
   B. The nominal interest rate is the inflation rate minus the real interest rate
   C. The real interest rate is the nominal interest rate minus the inflation rate
   D. The nominal interest rate is the real interest rate minus the inflation rate.

4. Which of the following statements is True ?

   A. The overall sum of all the entries in the balance of payments must be positive
   B. A country runs a current account surplus if it sells more of its assets abroad than it buys abroad
   C. A country runs a capital account deficit if it imports more than it exports
   D. If the current account is in surplus the capital account must be in deficit

5. Which of the following statements is true about a market economy ?

   A. With a large enough computer, central planners could guide production more efficiently than markets.
   B. Market participants act as if guided by an invisible hand to produce outcomes that maximize social welfare
   C. The strength of a market system is that it tends to distribute resources evenly across consumers.
   D. Taxes help prices communicate costs and benefits to producers and consumers.

6. Which of the following statements about economic fluctuations is true ?

   A. None of these answers
   B. A depression is a mild recession
   C. A variety of spending income, and output measures can be used to measure economic fluctuation because most macroeconomic quantitties tend to fluctuate together
   D. A recession is when output rises above the natural rate of output

7. Which of the following statements supports deregulation of industries ?

   A. Technological change has made it possible for many industries to become more competitive
   B. Because few real natural monopolies exist, there is rarely a reason for government regulation.
   C. Many instances of government regulation have succeeded in reducing competition in industries where competition may be beneficial
   D. All of the above

8. The government is considering placing a tax on cigarettes to raise revenue to finance health-care benefits. The demand for cigarettes is price inelastic Which of the following statements is True ?

   A. This tax will not raise much revenue either in the short term or the long term since demand is price inelastic
   B. The tax on cigarettes may not raise as much revenue as anticipated in the years to com because the demand for cigarettes is likely to become more elastic over time.
   C. This a very good way to raise revenue both in the short term and in the long term, because there are no substitutes for cigarettes.
   D. No tax revenue can be raised in this way because sellers of cigarette will just lower their price by the amount of the tax and therefore, the price of cigarettes to consumers will not change

9. Suppose each of 20 neighbours on street values street repairs at €3000 the cost of the street repair is €40,000 which of the following statements is true ?

   A. it is efficient for the government to tax the resident €2,000 each and repair the road
   B. It is efficient for each neighbour to pay €3,000 to repair the section of street in front of his/her home
   C. None of these answers are true
   D. it is not efficient to have the street repaired

10. In making which of the following statements is an economist acting more like a scientist ?

    A. A reduction in unemployment benefits will reduce the unemployment benefits will reduce the unemployment rate.
    B. The rate of inflation should be reduced because it robs the elderly of their savings.
    C. The unemployment rate should be reduced because unemployment robs individuals of their dignity.
    D. The state should increase subsidies to universities because the future of our country depends on education.