Gross Domestic Product (GDP) measures:
A) Total income earned by individuals in an economy
B) Total value of goods and services produced in an economy
C) Total government expenditure in an economy
D) Total imports and exports of a country
Inflation is defined as:
A) Increase in the general level of prices
B) Decrease in the general level of prices
C) Increase in the rate of unemployment
D) Decrease in the rate of economic growth
Unemployment rate is calculated as:
A) Number of unemployed individuals divided by total population
B) Number of unemployed individuals divided by total labor force
C) Number of employed individuals divided by total population
D) Number of employed individuals divided by total labor force
Fiscal policy refers to:
A) Government policy related to money supply and interest rates
B) Government policy related to taxation and spending
C) Central bank policy related to currency exchange rates
D) Market policy related to supply and demand
The Phillips curve illustrates the relationship between:
A) Inflation and unemployment
B) GDP and unemployment
C) Interest rates and inflation
D) Money supply and economic growth
The monetary policy is controlled by:
A) Fiscal authority
B) Central bank
C) Treasury department
D) Ministry of finance
Aggregate demand is the total:
A) Supply of goods and services in the economy
B) Demand for goods and services in the economy
C) Government expenditure in the economy
D) Savings in the economy
The multiplier effect refers to:
A) Increase in government spending to boost economic growth
B) Increase in consumer spending due to tax cuts
C) Increase in overall spending in the economy from initial change in spending
D) Decrease in overall spending in the economy from initial change in spending
Trade balance measures the difference between:
A) Exports and imports
B) Savings and investment
C) Government revenue and expenditure
D) Consumer spending and investment
Human capital refers to:
A) Physical assets owned by individuals
B) Financial resources available in the economy
C) Skills, knowledge, and experience of individuals
D) Market value of goods and services