Topic 1 - National Income - Multiple Choice Exercise
Choose the correct answer for each question in the quiz
Which of the following is a possible government objective as opposed to a policy?
- Lower interest rates.
- Lower taxation rates.
- Lower government spending.
- Lower inflation.
Which of the following is NOT a leakage from the circular flow of income?
- Imports.
- Government purchases.
- Taxes net of government transfers.
- Saving.
Which of the following is a policy instrument as opposed to a government objective?
- Lower interest rates.
- Government purchases.
- Taxes net of government transfers.
- Saving.
If injections are greater than leakages, then
- National income will increase.
- Government purchases.
- Taxes net of government transfers.
- Saving.
To adjust GDP from market prices to factor cost:
- Add indirect taxes.
- Subtract subsidies.
- Deduct indirect taxes and deduct subsidies.
- Deduct indirect taxes and add subsidies.
Real GDP is a measure of a country's
- Wealth.
- Money.
- Physical Output.
- Economic transactions
GDP is likely to increase with:
- An increase in consumer spending.
- An increase in taxation rates.
- A decrease in government spending.
- A fall in investment.
Gross National Product equals:
- Net National Product adjusted for inflation.
- Gross Domestic Product adjusted for inflation.
- Gross Domestic Product plus/minus net property income from abroad.
- Net National Product plus net property income from abroad.
The standard of living is often measured by:
- Real GDP per capita.
- Real GDP.
- Real GDP * Population.
- Real GDP plus depreciation.
Which of the following is an injection into the economy?
- Savings
- Investment
- Taxation.
- Import spending.
