Q11. It is true that a stable economy occurs when a. total injections into the c

Question

Q11. It is true that a stable economy occurs when
   a. total injections into the circular flow are large enough to make up for government tax leakages
   b. total leakages from the circular flow are great enough to offset the effects of government spending
   c. total planned leakages from the circular flow are exactly equal to total planned injections into the circular flow
   d. actual saving is equal to planned investment

Q12. The measure of income received by persons from all sources is known as
   a. personal income
   b. national income
   c. gross domestic product
   d. net national product

Q13. The best measure of a change in the standard of living is the change in
   a. nominal GDP
   b. real GDP
   c. real per capita disposable income
   d. net national product

Q14. GDP overstates national income because it does not make any adjustment for national debt.
   a. true
   b. false

Q15. The operation of the total economy can best be demonstrated by a
   a. merry-go-round
   b. circular flow
   c. Ferris wheel
   d. roller coaster

Explanation / Answer

Q11. It is true that a stable economy occurs when

   c. total planned leakages from the circular flow are exactly equal to total planned injections into the circular flow
   An economy with fairly constant output growth and low and stable inflation would be considered economically stable.

Q12. The measure of income received by persons from all sources is known as
   a. Personal Income

personal income means that an individual’s total earnings from deferent way like wages, investment and other ventures. Sum of all the income actually received by all the individuals.

Q13. The best measure of a change in the standard of living is the change in
   c. real per capita disposable income

Real income per capita is an inaccurate and insufficient indicator of living standards. For many economists, there is a growing disconnect between GDP and wellbeing

   

Q14. GDP overstates national income because it does not make any adjustment for national debt.
   b. False

Q15. The operation of the total economy can best be demonstrated by a
   
   b. circular flow

  the circular flow of income is basic concept of economics it implies that a simple economy consisting solely of businesses and individuals, and can be represented in a so-called "circular flow diagram."

Roller coaster: this is the best suitable for the business cycle. Every economy experiences ups and down

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