WorksheetsHow the Macroeconomy Works
Total questions: 10
Worksheet time: 10mins
All other things being equal, which one of the following is most likely to lead to an increase in imports? A fall in
the exchange rate
national income
government expenditure
the savings ratio
Which one of the following statements concerning UK investment is correct?
Increased investment leads to a reduction in saving.
Investment is the largest component of aggregate demand.
Investment is a withdrawal from the circular flow of income.
Investment can increase the capital stock of the economy.
All other things being equal, a large increase in interest rates in the UK is most likely to
decrease the size of the government budget deficit.
increase aggregate investment.
lead to an increase in bank lending.
decrease house prices.
Which one of the following is most likely to result in a demand-side shock to the UK economy? A large rise in
world commodity prices
UK wages due to a wave of strikes
UK interest rates
the price of imported semi-manufactured goods
Which one of the following is most likely to result in a rightward shift of the short-run aggregate supply curve?
A decrease in wage rates
A decrease in government spending
An increase in taxation
An increase in investment expenditure
Which one of the following is most likely to affect aggregate demand in the short run?
An increased rate of innovation
An increase in labour productivity
An increase in government spending
An increase in the mobility of labour
A leftward shift of aggregate demand could be explained by an increase in
imports
the price level
costs of production
investment
Which one of the following is most likely to reduce the level of investment in a particular economy? A fall in
the value of a country’s currency on the foreign exchange market.
aggregate demand in the economy.
the level of unemployment.
the spare capacity of the economy.
The relationship between the growth of national income and the resulting increase in investment is known as the
accelerator
output gap
economic cycle
multiplier
All other things remaining equal, the shift in the short-run aggregate supply curve to the right could have been caused by a decrease in
the savings ratio
energy prices
labour productivity
imports of consumer goods
