Here are your updates on the UK Economy and a multiple choice quiz!

UK Economy

• England's road-building budget cut by 5% (could this effect productivity?)
• It was revealed in the spring budget that the UK’s annual debt servicing costs are £102bn (how much we spend on debt interest - think of the opportunity cost!!!)
• The Bank of England set to raise deposit guarantee from £85,000 to £110,000 (the money protected in your bank account if the bank defaults - in an attempt to encourage savings to reduce inflation)
• Britain’s largest banks, technology, and telecom companies like HSBC, Amazon, and BT have agreed to share live updates about fraud which cost an estimated an estimated £6.8bn each year

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Time to test your knowledge! Here are 5 multiple choice questions with the answers at the bottom - good luck!

1) A good with a negative income elasticity of demand is classified as?

A) A normal good

B) A substitute good

C) A luxury good

D) An inferior good

2) The marginal propensity to consume (MPC) is 0.75. What is the value of the multiplier?

A) 2

B) 3

C) 4

D) 5

3) Which of the following is an example of dynamic efficiency?

A) A firm reducing waste and costs in the short term

B) A firm investing in new technology that improves productivity over time

C) A firm lowering its prices to achieve allocative efficiency

D) A firm charging prices equal to marginal cost

4) Which of the following is a primary objective of the European Central Bank (ECB)?

A) Achieving full employment in member states

B) Maintaining price stability within the Eurozone

C) Managing the fiscal policies of EU member countries

D) Regulating financial markets across the European

5) Which of the following is an advantage of "hot money flows" in the short run?

A) They lead to a stable exchange rate

B) They provide temporary foreign currency reserves

C) They reduce inflationary pressures

D) They provide temporary foreign currency reserves

Answers

D

C

B

B

D

If you got 5/5 reply to this for a prize!