Question : Which of the following is the reason of excess demand?
Option 1: Rise in the prosperity to consume
Option 2: Reduction in taxes
Option 3: Rise in imports
Option 4: Both A and B.
Correct Answer: Both A and B.
Solution : Following are the reasons of excess demand-
Hence Option D is correct.
Question : Which of the following are the reasons of deficient demand?
Option 1: Decrease in prosperity to consume
Option 2: Increase in taxes
Option 3: Both A and B
Option 4: Neither A nor B
Option 1: Fall in imports
Option 2: Rise in exports
Option 3: Deficit financing
Option 4: All of the above.
Option 1: Increase in government expenditure
Option 2: Increase in investment
Option 3: Fall in imports
Option 4: All of the above
Question : Which of the following are the reasons of deficient demand
Option 1: Decrease in government expenditure
Option 2: Fall in investment expenditure
Option 4: Rise in imports
Question : _______________ causes the general price level to rise (also known as inflation) in the economy.
Option 1: Excess demand
Option 2: Deficient demand
Option 3: Excess supply
Option 4: Deficient supply
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