Macro Economics MCQ
Macro Economics MCQ Meaning :- Macroeconomics is the branch of economics that deals with the structure, performance, behavior, and decision-making of the whole, or aggregate, economy. The two main areas of macroeconomic research are long-term economic growth and shorter-term business cycles.
81) Choose correct option
Statement 1: Model assumes stickiness prices
Statement 2: Classical model assumes flexibility of prices
A statement one and two are correct
B statement one only correct
C statement two only correct
D both are incorrect
Answer:a
82) Interest rates and bond prices are;
A positively related
B negatively related
C not related
D Either A or B
Answer:b
83) Keynes’s motivation in developing the aggregate output determination model from his concern with explaining;
A) the hyperinflations of the 1920s.
B) why the Great Depression occurred.
C) the high unemployment in Great Britain before World War I.
D) the high unemployment in Great Britain after World War II
Answer:b
84) Statement 1:There exists an inverse relationship between market rates of interest and price of bond Statement 2:The liquidity trap is a situation when at some very low rate of interest all asset holders become bears
A both are incorrect
B both are correct
C statement one is correct and two is not correct
D statement one is incorrect and two is correct
Answer:b
85) The Foreign Trade Multiplier is the ratio of;
A) the change in equilibrium output to a change in import.
B) the change in the money supply to a change in the monetary base.
C) the change in the money supply to a change in the autonomous expenditure.
D) the change in equilibrium output to a change in the autonomous expenditure.
Answer:a
86)) An increase in planned investment spending causes aggregate output to;
A) increase by an amount equal to the change in investment spending.
B) increase by an amount less than the change in investment spending.
C) increase by an amount greater than the change in investment spending.
D) decrease by an amount less than the change in investment
Answer:a
87)Keynes assumed that the price level was fixed because
A) inflation was not a serious problem during the Great Depression.
B) his primary focus was on output and employment.
C) his primary focus was on interest rates and investment spending.
D) of both (a) and (b) of the above.
Answer:d
88) IS curve shows that when income increases
A Interest rate must fall to restore equilibrium in the goods market
B Interest rate must fall to restore Equilibrium in the asset market
C Interest rate must rise to restore equilibrium in the asset market
D Interest rate must rise t restore equilibrium in the goods market
Answer:a
89) the LM curve slope:
A vertical
B slope upward
C slope downwards
D Horizontal
Answer:b
90) the slope of IS curve
A vertical
B slope upward
C slope downwards
D Horizontal
Answer:c
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