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King: Economics

Chapter 19

Instructions

Answer the following questions and then press 'Submit' to get your score.

Question 1

Which of the following must always be equal?

Question 2

Which of the following statements is correct in the case of a four-sector economy?

Question 3

Suppose that one month, injections in a four-sector economy are greater than withdrawals. Which of the following statements is false?

Question 4

Suppose we draw the consumption function for a two-sector economy, with disposable income, YDIS, on the horizontal axis and planned consumption, C, on the vertical axis. Suppose we also add a 45° line through the origin, and find that the consumption function intersects this at a YDIS equal to £1,000 billion a year. Which of the following statements is false?

Question 5

Which of the following factors might cause a country's consumption function to shift upwards?

Question 6

Consider a two-sector economy. Output has settled in equilibrium at the level where the injections line, J, intersects the withdrawals line, W. Which of the following statements is false?

Question 7

In a four-sector economy, which of the following is assumed always to increase when GDP increases?

Question 8

In a four-sector economy, which of the following would not cause a change in MPEy?

Question 9

Suppose the government increases the tax on tobacco products, and suppose the demand for these products is inelastic. How should this be analyzed on the multiplier model? Which of the following statements is true?

Question 10

Which of the following statements about multipliers is false?