Welcome to your Grade 12 Economics chapter 4
After carefully reading the following 30 questions, choose the correct answer.
1.
Which policy involves the use of government expenditure and revenue collection to influence the economy?
2.
What is the primary purpose of expansionary fiscal policy?
3.
Which of the following is an instrument of contractionary fiscal policy?
4.
Monetary policy is primarily controlled by which entity in a country?
5.
What happens to the money supply when the central bank increases the reserve requirement?
6.
Which term describes the lowest wage per hour that a worker may be paid as mandated by law?
7.
What is the effect of an appreciation of the domestic currency on imports?
8.
Which policy is adopted to control the situation of excess demand in an economy?
9.
In the context of foreign exchange, what does "devaluation" mean?
10.
Which of these is a tool used by the National Bank to influence the cost of money?
11.
What is the main goal of income policy?
12.
An increase in the bank rate by the central bank usually leads to:
13.
Open market operations involve:
14.
To encourage exports and overcome foreign exchange shortages, a country might:
15.
Which situation describes "deficient demand"?
16.
What is the purpose of the reserve requirement for commercial banks?
17.
How does a decrease in government expenditure affect aggregate demand?
18.
Fixed exchange rates are determined by:
19.
Which of these is a direct tool of fiscal policy?
20.
In a floating exchange rate system, the value of a currency is determined by:
21.
What is the impact of expansionary monetary policy on interest rates?
22.
Which policy is specifically used to address the "black market" for foreign exchange?
23.
A surplus in the government budget occurs when:
24.
The primary objective of "Income Policy" in many countries is to:
25.
What is "revaluation" of a currency?
26.
Which of the following describes "excess demand"?
27.
In perfectly competitive labor markets, what does the market labor supply curve measure?
28.
How can the government reduce the level of aggregate demand using fiscal tools?
29.
The purpose of "Moral Suasion" by a central bank is to:
30.
Which exchange rate system involves the value being pegged to a major currency like the US Dollar?
