Economics MCQs

Page No. 294

The refinancing rate is ?


aThe interest rate at Which commercial banks lend to and borrow from each other


bThe interest rate the European Central Bank pays on reserves


cThe interest rates the public pays when borrowing from banks


dThe interest rates the European Central Bank charges on loans to banks



Reserve requirements that may be imposed on an economy’s banks by its central bank specify that banks by its central bank specify that banks reserve must be a minimum percentage of them ?


aassets


bdeposits


cloans


dgovernment bonds


View Answer deposits

If the banks in an economy operate with a reserve ratio of 20 percent then the money multiplier is ?


a 4


b 20


c25


d5


View Answer 5

Which of the following statements about money is not true ?


aA debit card is not really money because it is only a means of transferring money between accounts


bAll the wealth that people hold, in whatever form, should be considered as money


cWealth held in the current account you hold with your bank is almost as convenient for buying things as wealth held in your wallet so the wealth in current accounts should be included in measures of money


d In a complex economy it is not easy to draw a clear dividing line between assets that should be considered as money and those that should not



An example of fiat money is ?


aPaper euros


b gold


c Silver coins


dcigarettes


View Answer Paper euros

Money is ?


aThe value of all coins and currency in circulation at any time


bAnything that is generally accepted as a medium of exchange


cThe same as income


dAll of the above



Which of the following best defines price discrimination ?


acharging different prices on the basis of race


bcharging different prices for goods with different costs of production


ccharging different prices based on cost-of-service differences


d selling a certain product of given quality and cost per unit at different prices to different buyers



Compared to the case of perfect competition, a monopolist is more likely to ?


acharge a higher price


bproduce a lower quantity of the product


cmake a greater amount of economic profit


d all of the above


View Answer all of the above

In pure monopoly, what is the relation between the price and the marginal revenue ?


athe price is greater than the marginal revenue


b the price is less than the marginal revenue


cthere is no relation


dthey are equal



If a marginal revenue exceeds marginal cost, a monopolists should?


a increase should


bdecrease output


ckeep output the same because profits are maximized when marginal revenue exceeds marginal cost


d raise the price


View Answer increase should

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