AS MCQ 2022

In the model of the circular flow of income, which of the following will cause national income to increase?

• An increase in government spending

• An increase in imports

• An increase in savings

• An increase in taxes

What type of policy is deregulation?

• Exchange rate

• Fiscal

• Monetary

• Supply side

Which of the following is a definition of hyperinflation?

• Prices are constant

• Prices are falling

• Prices are rising at a slower rate than previously

• Prices are rising excessively

Which of the following may lead to a UK balance of payments current account deficit?

• An appreciation of the UK pound

• An increase in tariffs on UK imports

• Lower UK inflation relative to other countries

• Research and development subsidies for UK firms

If government spending increases significantly during a recession, it may cause a:

• capital account surplus

• current account surplus

• cyclical budget deficit

• structural budget deficit

The table shows the value of imports and exports for a country in 2019. What was the balance of trade in goods?

• – £675bn

• – £195bn

• + £480bn

• + £1285bn

The UK government is planning to limit immigration. What impact may this have on the UK economy in the short-run?

• Shift aggregate demand to the left

• Shift aggregate demand to the right

• Shift aggregate supply to the left

• Shift aggregate supply to the right

Which of the following is most likely to occur in the boom phase of the economic cycle?

• GDP falls and unemployment increases

• GDP increases slowly and unemployment falls

• Investment expenditure and unemployment increase

• Unemployment falls and asset values increase

What is the marginal tax rate if an individual's annual income increases from £30,000 to £35,000? The table shows the tax paid by individuals at different levels of income.

• 10%

• 13%

• 30%

• 50%

Which of the following is not a component of aggregate demand?

• Consumption

• Exports

• Investment

• Wealth