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King: Economics

Chapter 22

Instructions

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

Question 1

Which of the following groups of people are not regarded as economically inactive?

Question 2

Which of the following statements is false as far as the UK is concerned?

Question 3

If all the following events occurred in 2013, which one would put upward pressure on the rate of natural unemployment in the UK in 2013?

Question 4

Which of the following will not cause the level of unemployment to settle above the level where the aggregate supply curve of labour intersects the aggregate demand curve for labour?

Question 5

What is the main reason that led classical economists to believe that the government need not respond to a demand shock which led to unemployment?

Question 6

According to the idea of the neutrality of money, or the classical dichotomy, which of the following statements describes the long-run effect of a rise in the money stock?

Question 7

According to the quantity theory of money, what long-run effect will a 10% rise in the money stock have on the price level?

Question 8

Keynes suggested several reasons why the government should not rely on flexible real wages to remove demand-deficient unemployment. Which of the following was not one of these reasons?

Question 9

Faced with a choice between fiscal and monetary policy to try and increase aggregate demand, Keynes believed that fiscal policy would have more effect. Which of the following was not one of his key reasons for holding this belief?

Question 10

Faced with a choice between fiscal and monetary policy to try and increase aggregate demand, monetarists believed that monetary policy would have more effect. Which of the following was not one of their key reasons for holding this belief?