731. What is the role of the Consumer Price Index (CPI)?
A) To measure changes in the average price level of goods and services purchased by households.
B) To measure changes in the average production cost of goods and services.
C) To measure changes in the total value of goods and services produced in a country.
D) To measure changes in the total value of a country’s exports and imports.
732. What is the difference between demand-pull and cost-push inflation?
A) Demand-pull inflation is caused by a decrease in aggregate demand, while cost-push inflation is caused by an increase in aggregate demand.
B) Demand-pull inflation is caused by an increase in aggregate demand, while cost-push inflation is caused by an increase in production costs.
C) Demand-pull inflation is caused by changes in consumer preferences, while cost-push inflation is caused by changes in government spending.
D) There is no difference between demand-pull and cost-push inflation.
733. Economies of Scale meaning ?
A. Cost on all products
B. Reduced per unit Cost
C. Higher per unit Cost
D. None of these
734. The positive relationship between price and quantity supplied is called:_?
A. Profit
B. a change of supply
C. a shift to the supply curve
D. the law of supply
735. What does the term “stagflation” refer to?
A) A situation with high inflation and high unemployment.
B) A period of economic growth without inflation.
C) A combination of stagnant economic growth and high inflation.
D) A situation with low inflation and low unemployment.
736. Which of the following is a fiscal policy tool to combat a recession?
A) Decreasing government spending.
B) Decreasing taxes.
C) Increasing government spending.
D) Increasing interest rates.
737. What is the Phillips Curve?
A) A curve illustrating the trade-off between inflation and unemployment.
B) A curve showing the relationship between interest rates and investment.
C) A curve depicting the relationship between government spending and economic growth.
D) A curve representing the impact of taxes on consumer behavior.
738. In the context of monetary policy, what is the federal funds rate?
A) The interest rate charged by commercial banks to their customers.
B) The interest rate at which banks lend to each other overnight.
C) The interest rate set by the Federal Reserve for all types of loans.
D) The interest rate paid on government bonds.
739. What is the formula for calculating the unemployment rate?
A) (Number of employed / Labor force) × 100.
B) (Number of unemployed / Labor force) × 100.
C) (Labor force / Number of employed) × 100.
D) (Labor force / Number of unemployed) × 100.
740. What is the main goal of expansionary monetary policy?
A) To control inflation.
B) To reduce government spending.
C) To stimulate economic growth by increasing the money supply and lowering interest rates.
D) To decrease the money supply to combat inflation.
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