The 'multiplier-accelerator interaction' explains: MCQ with Answer and Explanation

Question
The 'multiplier-accelerator interaction' explains:
A. inflation only
B. business cycles and fluctuations in income
C. monetary policy only
D. exchange rates
Answer: Option B
Solution (By JKSSB Mock Tests)
Multiplier-accelerator interaction explains cyclical fluctuations in income.
This question belongs to: Economy GK Economy Set 1
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Practice More Economy Set 1 Questions

Question #1
Which of the following is a characteristic of the long-run equilibrium in perfect competition?
A. Price is greater than marginal cost
B. Firms earn supernormal profits
C. Price equals minimum average cost and firms earn normal profits
D. Firms operate with excess capacity
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Correct Answer: Option C

Explanation:
In long-run equilibrium under perfect competition, free entry and exit ensure that price equals minimum long-run average cost and firms earn only normal profits.
This question belongs to: Economy GK Economy Set 1
Question #2
The 'World Trade Organization' headquarters is in:
A. New York
B. Geneva
C. Washington D.C.
D. Paris
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Correct Answer: Option B

Explanation:
WTO headquarters is in Geneva.
This question belongs to: Economy GK Economy Set 1
Question #3
The 'World Bank's World Development Indicators' is a publication that:
A. tracks military spending
B. provides development data on countries
C. publishes stock prices
D. sets interest rates
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Correct Answer: Option B

Explanation:
World Development Indicators provides comprehensive development data.
This question belongs to: Economy GK Economy Set 1
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