Management (Quiz) MCQs

The effects of inflation on the price competitiveness of a country’s products may be offset by

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The effects of inflation on the price competitiveness of a country’s products may be offset by

The effects of inflation on the price competitiveness of a country’s products may be offset by

    1. An appreciation of the currency
    2. A revaluation of the currency
    3. A depreciation of the currency
    4. None of the above

Correct Answer: A depreciation of the currency

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In short-run, unemployment may fall below the natural rate of unemployment if:

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In short-run, unemployment may fall below the natural rate of unemployment if:

In short-run, unemployment may fall below the natural rate of unemployment if:

    1. Nominal wages have risen less than inflation
    2. Nominal wages have risen at the same rate as inflation
    3. Nominal wages have risen more than inflation
    4. Nominal wages have risen less than unemployment

Correct Answer: Nominal wages have risen less than inflation

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An increase in aggregate is more likely to lead to demand pull inflation if:

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An increase in aggregate is more likely to lead to demand pull inflation if:

An increase in aggregate is more likely to lead to demand pull inflation if:

    1. Aggregate supply is perfectly elastic
    2. Aggregate supply is perfectly inelastic
    3. Aggregate supply is unit inelastic
    4. Aggregate supply is relatively inelastic

Correct Answer: Aggregate supply is perfectly inelastic

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According to Phillips curve unemployment will return to the natural rate when:

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According to Phillips curve unemployment will return to the natural rate when:

According to Phillips curve unemployment will return to the natural rate when:

    1. Nominal wages are equal to expected wages
    2. Real wages are back at equilibrium level
    3. Nominal wages are growing faster than inflation
    4. Inflation is higher than the growth of nominal wages

Correct Answer: Real wages are back at equilibrium level

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Which of the following is phenomenon that leads to Hyperinflation?

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Which of the following is phenomenon that leads to Hyperinflation?

Which of the following is phenomenon that leads to Hyperinflation?

    1. It is a situation when aggregate demand in an economy outpaces aggregate supply
    2. It is a situation of persistent rise in inflation along with dip in growth and increase in unemployment
    3. It is a situation caused by an increase in prices of inputs like labour, raw material etc
    4. It is a situation when a nation experiences very high and accelerating inflation

Correct Answer: It is a situation when a nation experiences very high and accelerating inflation

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Governments may end up with a high money growth rate and high inflation as a result of policies designed to

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Governments may end up with a high money growth rate and high inflation as a result of policies designed to

Governments may end up with a high money growth rate and high inflation as a result of policies designed to

  1. Lower unemployment
  2. Finance persistent government budget deficits through money creation rather than by issuing bonds
  3. Redistribute wealth from debtors to creditors
  4. Both ( a) and (b)

Correct Answer: Both (a) and (b) 

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