AP (Advanced Placement) Macroeconomics: Questions 580 - 583 of 750

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Question 580

Question

MCQ▾

Which among the following is correct for the discretionary fiscal action?

Choices

Choice (5)Response

a.

A managed change in level of Government spending and/or net tax revenue.

b.

Payment of unemployment insurance.

c.

Automatic changes in net tax revenues that result from income tax structure

d.

Payment of social security to the retired individuals.

e.

Question does not provide sufficient data or is vague

Question 581

Question

MCQ▾

‘Menu cost’ in relation to inflation refers to:

Choices

Choice (5)Response

a.

Cost of the maintenance of monetary base.

b.

Cost of revaluing currency.

c.

Cost of finding better rates of return.

d.

Cost of altering price lists.

e.

Question does not provide sufficient data or is vague

Question 582

Question

MCQ▾

An increase in the quantity of money in the classical macro system will result in:

1) Increases in price level

2) No change in price level

3) Level of output and employment do not change

4) An increase in employment and output

Code:

Choices

Choice (5)Response

a.

1 and 4

b.

1 and 3

c.

1 and 2

d.

2 & 4

e.

Question does not provide sufficient data or is vague

Question 583

Question

Assertion-Reason▾

Assertion(Ꭺ)

In the short run under perfect competition, given the market demand and market supply the industry is in equilibrium at that price which clears the market.

Reason(Ꭱ)

In the long run all the firms in the industry earn profit.

Choices

Choice (5)Response

a.

Both Ꭺ and Ꭱ are true and Ꭱ is the correct explanation of Ꭺ

b.

Both Ꭺ and Ꭱ are true but Ꭱ is NOT the correct explanation of Ꭺ

c.

Ꭺ is true but Ꭱ is false

d.

Ꭺ is false but Ꭱ is true

e.

Both Ꭺ and Ꭱ are false

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