The demand for money to take advantage of changes in bond prices is the
Unforeseen motive
Transaction motive
Speculative motive
Precautionary motive
Correct answer is C
Speculative demand for money refers to a desire to hold cash/money in order to be ready to take advantage of any attractive investment opportunity requiring a cash expenditure. Example holding money so as to invest in shares or bonds when opportunity arises.
A fall in national output will necessitate
A rise in expenditure on imports
A rise in the level of savings
An increase in the consumption of expenditure
A rise in the standard of living
Correct answer is B
An economy's level of output occurs when all available resources are used efficiently. It equals the highest level of production an economy can sustain. A fall in the level of output will invariably lead to reduced consumption and high savings. When the people do not have products to spend their monies on, they will be forced to safe the leftover after consumption.
When a country's net income from abroad is added to its total output, the result is
Gross domestic product
Net national product
Gross national product
Net domestic product
Correct answer is C
Gross national product is the total value of goods produced and services provided by a country during one year, equal to the gross domestic product plus the net income from foreign investments. GNP calculation includes income earned by domestic residents abroad minus the income of foreigners earned in the domestic economy.
GNP is calculated by taking the sum of personal consumption expenditures, private domestic investment, government expenditure, net exports and any income earned by residents from overseas investments, minus income earned within the domestic economy by foreign residents.
Rate of tax is constant at all income levels
Rate of tax decrease as income increases
Rate of tax increases as income increases
Tax is direct rather than indirect
Correct answer is B
A regressive tax is a tax applied uniformly, taking a larger percentage of income from low-income earners than from high-income earners. Regressive taxes place more burden on low-income earners. Since they are flat taxes, they take a higher percentage of income on the poor than on high-income earners.
The taxable rate reduces as income increases, and it increases as income decreases.
National income is used to measure
A country's population size
A country's economic growth
The human level of development
The flow of imports to a country
Correct answer is B
National income measures the monetary value of the flow of output of goods and services produced in an economy over a period of time. This is otherwise considered as measuring the economic growth.