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- 1. Multiple Choice
Market-based supply-side policies do not include _________
tax cuts
privatisation of state-owned assets
deregulation
government provision of transport infrastructure
- 2. Multiple Choice
Which statement does not apply to supply-side policies?
Macroeconomic policies aimed at improving the ability of the economy to increase its aggregate supply of goods and services.
Design to make the economy more productively efficient in the long run
Used to increase the productive potential of the economy
The use and manipulation of interest rates to affect the level of economic activity
- 3. Multiple Choice
Which of the following is a supply-side policy used to reduce unemployment?
Reduce welfare benefits to the unemployed
Privatisation of state-owned assets
Regulations of the financial sector
Reduced interest rates to stimulate economic activity
- 4. Multiple Choice
Privatisation is the transfer of ...
private sector assets to the public sector
state-owned assets to the private sector
sales of private sector assets
income form private sector to the public sector
- 5. Multiple Choice
An increase on which of the following is least likely to shift the long run aggregate supply curve of an economy to the right?
investment in education
investment on infrastructure
public sector spending
spending on research and development
- 6. Multiple Choice
Which of the following is not a supply-side policy involving investment in human capital?
schemes to increase labour mobility
policies aimed at promoting job opportunities and growth in specific industries
investment expenditure in education
subsidising training programs for small and medium sized business
- 7. Multiple Choice
Which of the following is an example of labour market reform?
reducing the power of trade union
raising the upper rate of capital gains tax
investment in education and training
trade liberalization policies that encourage greater competition in a particular industries
- 8. Multiple Choice
Labour market reforms aim to increase labour market flexibility and efficiency cannot be achieved by ...
removing the national minimum wage
reducing unemployment benefits
increasing subsidies paid to the strategic industries
reducing the power of labour union
- 9. Multiple Choice
Which of the following is not a potential negative consequence of market-based supply-side policies?
Increased inequality
Increased negative externalities such as pollution
Lower incentives to work
Lower tax revenue
- 10. Multiple Choice
Which of the following is a supply side policy measure?
A decrease in government spending on education
A decrease in government spending on healthcare
An increase in corporation tax
An increase in the threshold at which people pay income tax
- 11. Multiple Choice
What is most likely to conflict with a government's full employment?
lower income tax
lower spending on imports
higher government expenditure
higher interest rate
- 12. Multiple Choice
What combination of macroeconomic aims is most likely to benefit from a decrease in government spending?
a fall in imports and price stability
economic growth and full employment
full employment and fall imports
price stability and economic growth
- 13. Multiple Choice
Which of the following may reduce the effectiveness of government policy measure?
accurate information
an absence of economic problems in other economies
an absence of policy conflicts
a time lag
- 14. Multiple Choice
Which option is not a supply-side policy?
deregulation of markets
human capital investment
progressive income tax policies
tax reforms to create incentives to work
- 15. Multiple Choice
Which pair of government actions combines a fiscal policy with a supply-side policy?
changing government spending with changing interest rates
cutting tax rates with providing information on job vacancies
limiting bank lending with the privatisation of industry
restricting credit with less control over labour markets
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