A profit maximising firm will invest up to the level of investment where ? A. The cost of borrowing equals the marginal efficiency of capital B. The cost of borrowing is greater than the marginal efficiency of capitalC. The cost of borrowing is less then the marginal efficiency of capital D. The cost of borrowing…
The accelerator assumes ? A. The marginal propensity to consume is constant B. The economy is at full employmentC. There is a constant relationship between net investment and the rate of change of output D. The multiplier is constant
An outward shift in the Marginal Efficiency of Capital should ? A. Decrease consumption B. Increase aggregate demandC. Reduce aggregate supply D. Slow economic growth
The marginal propensity to consume is equal to ? A. Total spending / total consumption B. Total consumption / total income C. change in consumption / change in income D. Change in consumption / change in savings
Lower interest rates are likely to ? A. Decrease consumptionB. increase cost of borrowing C. Encourage saving D. Increase spending
As income increase ? A. The average propensity to consume gets nearer in value of the marginal propensity to consume B. The average propensity to consume diverges in value from the marginal propensity to consumeC. The average propensity to consume falls D. The average propensity to consume always approaches 0
An increase in the marginal propensity to consume will ? A. increase the size of the multiplierB. Increase the marginal propensity to save C. Decrease national income D. Reduce injections into the economy
When an economy first begins to grow more slowly ? A. GDP increase B. Inflation is likely to increaseC. Stock levels are likely to increase D. Investment in equipment is likely to increase
If the Keynesian consumption function is C = 10 + 0.8 Td when disposable income is Rs1000 the marginal propensity to consume is what ? A. 0.8 B. 800 C. 810D. 0.81
Economic growth can be seen by an outward shift of ? A. The Production Possibility Frontier B. The Gross Domestic Barrier C. The Marginal Consumption FrontierD. The Minimum Efficient Scale