Important Economic Curves and Indicators CDS Questions

CDS Economy

Important Economic Curves and Indicators MCQ Questions


13.
A reduction in the RATE of inflation (inflation still positive but slowing) is called:
A.
Deflation
B.
Disinflation
C.
Reflation
D.
Hyperinflation
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ANSWER :
B. Disinflation
14.
Which curve is most relevant for studying how consumption of food changes with household income?
A.
Engel Curve
B.
Laffer Curve
C.
Phillips Curve
D.
Lorenz Curve
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ANSWER :
A. Engel Curve
15.
If the Engel Curve for a good is a straight line passing through the origin, the income elasticity of demand for that good is:
A.
Zero
B.
Exactly equal to one (unitary)
C.
Negative
D.
Infinite
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ANSWER :
B. Exactly equal to one (unitary)
16.
Which curve is primarily a tool of fiscal/tax policy analysis?
A.
Indifference Curve
B.
Phillips Curve
C.
Engel Curve
D.
Laffer Curve
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ANSWER :
D. Laffer Curve
17.
Match correctly: (1) Phillips Curve (2) Laffer Curve (3) Engel Curve
A.
1-Income & consumption, 2-Inflation & unemployment, 3-Tax & revenue
B.
1-Inflation & unemployment, 2-Income & consumption, 3-Tax & revenue
C.
1-Tax & revenue, 2-Income & consumption, 3-Inflation & unemployment
D.
1-Inflation & unemployment, 2-Tax rate & revenue, 3-Income & consumption
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ANSWER :
D. 1-Inflation & unemployment, 2-Tax rate & revenue, 3-Income & consumption
18.
The line of perfect equality in a Lorenz Curve diagram is:
A.
A horizontal line
B.
An inverted-U curve
C.
A 45-degree diagonal line
D.
A vertical line
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ANSWER :
C. A 45-degree diagonal line