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Bihar Board Class 12 (Arts) Theory of Consumer Behaviour & Demand — practice questions — page 7

Explore 192 free Theory of Consumer Behaviour & Demand questions in Bihar Board Class 12 (Arts) Economics. Open each question or exercise to read its content, reference answers and available explanation.

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Theory of Consumer Behaviour & Demand questions and exercises with answers

Showing questions 181–192 of 192.

A general price increase across the entire economy is called what?Read the answer and worked solution →Economists measure changes in the general price level using what?Read the answer and worked solution →Which theory links price level changes to money supply?Read the answer and worked solution →The short run in macroeconomics refers to a few years and focuses mainly on what?Read the answer and worked solution →The long-run emphasis in macroeconomics is on determinants of what?Read the answer and worked solution →Stabilization policy mainly uses which two sets of tools?Read the answer and worked solution →Central banks conduct monetary policy mainly by adjusting what?Read the answer and worked solution →Expansionary monetary policy does what to interest rates?Read the answer and worked solution →Fiscal policy uses which two instruments to influence the economy?Read the answer and worked solution →Government spending that limits resources for private firms is an example of what?Read the answer and worked solution →Which model, invented by John Hicks in 1936, shows equilibrium in goods and money markets?Read the answer and worked solution →In the AD-AS model, the aggregate demand curve slopes in which direction?Read the answer and worked solution →

Worked practice questions

A general price increase across the entire economy is called what?

  1. Deflation
  2. Stagnation
  3. Inflation
  4. Devaluation
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Correct answer: C. Inflation

Inflation is a general rise in prices across the economy, while a general fall is deflation.

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Economists measure changes in the general price level using what?

  1. Interest rates
  2. Exchange rates
  3. Tax slabs
  4. Price indexes
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Correct answer: D. Price indexes

Price indexes track how the average level of prices changes over time.

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Which theory links price level changes to money supply?

  1. Quantity theory of money
  2. Law of diminishing returns
  3. Okun law of output
  4. Say law of markets
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Correct answer: A. Quantity theory of money

The monetarist quantity theory of money links price level changes directly to money supply changes.

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