Important Economic Curves and Indicators CDS Questions

CDS Economy

Important Economic Curves and Indicators MCQ Questions


1.
The Phillips Curve shows the relationship between:
A.
Inflation and Unemployment
B.
Tax Rates and Revenue
C.
Income and Consumption
D.
Supply and Demand
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ANSWER :
A. Inflation and Unemployment
2.
What does the Laffer Curve represent?
A.
Relationship between Inflation and Output
B.
Relationship between Tax Rates and Tax Revenue
C.
Relationship between Income and Savings
D.
Relationship between Demand and Supply
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ANSWER :
B. Relationship between Tax Rates and Tax Revenue
3.
Engel Curve primarily focuses on the relationship between:
A.
Income and Savings
B.
Income and Consumption
C.
Tax Rates and Revenue
D.
Unemployment and Inflation
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ANSWER :
B. Income and Consumption
4.
According to the Phillips Curve, as unemployment decreases:
A.
Inflation increases
B.
Inflation decreases
C.
Tax revenue increases
D.
Consumption decreases
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ANSWER :
A. Inflation increases
5.
If a good is considered inferior, its Engel curve will:
A.
Always slope upward
B.
Always slope downward
C.
Initially slope upward, then bend backward
D.
Be a vertical line
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ANSWER :
C. Initially slope upward, then bend backward
6.
What does the term 'elasticity' in economics refer to?
A.
The strength of consumer preferences
B.
The responsiveness of demand to changes in price
C.
The slope of the Engel Curve
D.
The stability of inflation rates
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ANSWER :
B. The responsiveness of demand to changes in price