1st Year Principles of Economics Chapter 11 TestBusiness Cycle / Trade Cycle

Q1. Multiple choice questions (Attempt all · 10 × 1 = 10)

1. During depression:

   1. Employment increases

   2. Prices decrease

   3. Profit increases

   4. Price increase

2. During the phase of depression, level of national income and employment is:

   1. Highest

   2. Falling

   3. Lowest

   4. Increasing

3. Psychological theory of trade cycles is presented by:

   1. Prof Jevons

   2. Prof Pigou and Bagehot

   3. Prof Keynes

   4. Prof Hawtery

4. "A trade cycle is fluctuation in employment, production and prices" This definition of trade cycle is stated by:

   1. Prof Keynes

   2. Prof Mitchall

   3. Prof Hanson

   4. Prof Haberler

5. Economy gets prosperity during:

   1. Recession

   2. Depression

   3. Boom

   4. Recovery

6. During depressions, the government prepares ...... budget:

   1. Balanced

   2. Surplus

   3. Deficit

   4. Unbalanced

7. During the phase of recession prices of goods:

   1. Start rising

   2. Start falling

   3. Are highest

   4. Are lowest

8. The period in which an economy comes back from prosperity to depression is called:

   1. Recovery

   2. Recession

   3. Boom

   4. Depression

9. The living standard increase in:

   1. Boom

   2. Depression

   3. Recession

   4. Recovery

10. The economic circumstances are prosperous in:

    1. Boom

    2. Recession

    3. Depression

    4. Recovery