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Worksheetseco part 1
Total questions: 64
Worksheet time: 32mins
Macroeconomics approaches
from the viewpoint of
individual firms
individual consumer
government units
the entire economy
Which of the following is a macroeconomic statement?
the gross profit of all Malaysian businesses were 10 billion last year
the price of beef declined by 1% last year
general motor's profits increased in the year 2003
the productivity of steel works increased by 1% in the year 2003
Economic growth would most likely be stimulated by
higher unemployment rates
price level stability
sustained economic growth
high level of environmental quality
Economic growth would most likely be stimulated by
higher unemployment rates
faster rates of technological progress
increases in membership of labour unions
consumption of more viewpoint of consumer goods
Economic growth would result from technological advances or increases in the resources available or
reduced rates of employment outsourcing
the federal budget deficit
aggregate demand
an increase in the country's terms of trade
Economic growth most unambiguously occurs when there are increases in
potential real GDP
aggregate demand
ederal budget surpluses
the population of a country
Fiscal policy attempts to achieve all of the following objectives except
full employment
economic growth
price level stability
stable money supply
Excessive monetary growth was viewed as the dominant influence in determining
inflation
deflation
unemployment
price stability
All else constant, decreases in aggregate demand tend to cause increases in
employment
nominal interest rate
GDP and National Income
unemployment
What is the meaning of equilibrium in macroeconomics?
aggregate demand is more than aggregate supply
aggregate demand is less than aggregate supply
aggregate demand is equal to aggregate supply
total value of output produced is more than total value of expenditure
Economic functions of the government are all of the following except
to control the price level of public goods
to create a stable economic environment
to increase the level of education
to distribute income and wealth
The deficit budget occurs when
the public debt deceases
the government's total expenditure equals revenue
tax collection is more tha government expenditure
the government's total expenditure exceededs revenue
The budget deficit tends to decrease when
GDP deceases rapidly
GDP remains unchanged
GDP increases
GDP decreases slightly
The surplus budget occurs when
the public debt deceases
the government's total expenditure equals revenue
tax collection is more than government expenditure
the government's total expenditure exceeded revenue
The balance budget occurs when
the public debt decreases
the government's total expenditure equals revenue
tax collection is more than government expenditure
the government's total expenditure exceeded revenue
National budget can be divided into the following categories:
balance budget
surplus budget
deficit budget
all of above
The source of government revenue comes from
direct tax
indirect tax
non-tax revenue
A up to C
In Malaysia, the biggest contributor of sources of government income is
sales and service tax
petroleum tax
income tax
indirect taxes
Government revenue obtained from fees for issue of license and
permit is
non-tax revenue
tax revenue
indirect tax
direct tax
Generally, the government budget is intended for the following purposes :
operational
development
both above
political
Government operating expenditure consists of
social services
public utilities
grant and transfers
trade and industry
Security and defense
expenditure, economie services, and social services fall under
operating expenditure
development expenditure
operating and development expenditure
none of the above
National debt from internal sources are all the following except
the sale of treasury
investment certificates and government securities to the employees
sales of government securities in the international financial markets
insurance companies
The disadvantages of the country's loans is
reduces the money supply in the economy
higher loan coast
outflow of funds abroad
exposed to the risk of exchange rate changes
A cut in defense spending is an example of
an expansionary fiscal policy
a contractionary monetary policy
an expansionary monetary policy
a contractionary monetary policy
The government imposes the expansionary fiscal policy by
increasing government taxes and increasing government expenditure
decreasing government taxes and decreasing government expenditure
increasing government taxes and decreasing government expenditure
decreasing government taxes and increasing government expenditure
The quamtitaive monetary policy includes all of the following except
selective loan control
open market operation
need for statutory reserve
discount operation
Which of the following is not a qualitative monetary policy?
raising discount bank rate operation
moral persuasion
special directive
selective credit control
Direct control policy covers
increasing interest rate
reducing government expenditure
raising reserves requirement
developing new land
The steps taken by the government in monitoring the price movement is by
monitoring the price level of goods in the market
providing the public goods for the public facility
encouraging investment especially foreign investment
ensuring that income is distributed more fairly among the people
Money
loses its value as it become older
is always composed of coins and paper
requires a double coincidence of wants
is any commodity that is generally acceptable as a means of payment
The demand curve for money
shows the amount of money balances that businesses wish to hold at various interest rates
reflects the open market operation policy of the Central Bank
shows the amount of money individuals and businesses wish to hold various price levels
reflect the discount rate policy of the Central Bank
Money is used as a medium of exchange to buy goods. Below are the functions of money except
be a store of value or wealth
legal tender
medium of exchange
measure the value and unity of value
Money demand for speculative purposes refers to
the ability of households and firms to engage in the transactions
households and firms that need cash to buy goods and services
unexpected expenses such as hospital bills and car repair bills
people needing cash to buy bonds and stocks for generating profit
M1 includes all the following items except
traveler's cheques
saving deposits
currency owned by individuals and businesses
checking deposits owned by individuals and businesses
Money that can be directly used for transactions is
M1
M2
near money
broad money
Which of the following can reduce money supply?
reducing the reserve ratio
reducing the discount rate
increasing the reserve ratio
buying government securities in the open market
Below are the functions of Bank Negara Malaysia except
issuing government bonds
expecting current deposits from individuals
expecting deposits from commercial banks
be a holder of gold and foreign exchange
People have many reasons to hold their money. Which of the following situations describes the reasons?
(I To pay transportation services)
(II To buy groceries)
(III To make a profitable investment)
(IV To pay hospital bills)
I and II
II and III
III and IV
all of the above
Accepting deposits from individuals and firms and providing loans to the public are the basic functions of
discount houses
commercial banks
insurance companies
Bank Negara Malaysia
One role monetary policy is to control_by changing the_
inflation; price level
unemployment;level of taxation
the price level; government spending
inflation; quantity of money in circulation
Monetary policy refers to
controlling the supply of money
stimulating the potential growth of aggregate output
narrowing the gap between the higher and lower income
government policy concerning taxes and expenditure
The contractionary monetary policy is imposed by the government to
reduce problems of inflation
increase aggregate demand
reduce problems of deflation
increase the money supply in the economy
which of the following is the characteristics of money?
inadequacy
divisibility
lack of security
tough
Macroeconomics is associated with the fluctuation of the general price level in the country.
true
false
Macroeconomics explains the behaviour of individual household and business firms.
true
false
Price level stability is one of the macroeconomic goals.
true
false
The purpose of a monetary policy is to maintain the overall price level and to achieve higher economic growth.
true
false
The government implements contractionary monetary policy when recession occurs.
true
false
Monetary policy is changes in the money supply or credit conditions designed to achieve macroeconomic goals.
true
false
The tools of fiscal policy are government expenditure and taxation.
true
false
Changes in government expenditure is a fiscal budget policy.
true
false
Aggregate demand is the total aggregate output and price level of economy in a given period.
true
false
The aggregate supply curve is a positive relationship between the price level and the level of national output.
true
false
The Human Resources Minister will announce the National Budget in September or October in Parliament.
true
false
Petroleum tax is considered as direct tax.
true
false
The non-tax revenue is not generated from tax.
true
false
Management expenditure on various government departments is to maintain services.
true
false
The objective of development expenditure is to assist projects that will boost economic growth.
true
false
Payment of interest and principal repayments of external debt lead to money flowing out of the country and foreign exchange reserves will be reduced.
true
false
The government implements contractionary monetary policy when recession occurs.
true
false
Reducing personal income tax rates is an example of fiscal policy.
true
false
The contractionary monetary policy is imposed by the government to control inflation.
true
false
Direct control measures to combat unemployment is by disseminating labor market information.
true
false
