The Gross Domestic Product is defined as the total value of?
- A. all final goods and services produced in a country during the year
- B. all assets of a country in a particular year
- C. exports net of total value of imports
- D. all receipts
It is important to measure the National Income of a country because?
- A. it is a major determinant of the standard of living
- B. it reveals hazards of development like pollution and congestion
- C. it reveals the distribution of the citizen's savings in foreign banks
- D. its size determines the extent of political stability
The age distribution of a country’s population is of economic importance because it affects the?
- A. pattern of expenditure
- B. size of the army
- C. optimum size of firms
- D. location of industries
The higher the the dependency ratio the?
- A. larger the proportion of the employed relative to the unemployed
- B. smaller the proportion of the active labour force relative to the inactive
- C. smaller the number of the non-working age groups relative to the active labour force
- D. lower the birth rate
Under flexible exchange rates, a deficit could be corrected by?
- A. freezing the gold point
- B. appreciation of other currencies
- C. removing export subsidies
- D. removing tariffs
there is an improvement in the terms of trade of a country if?
- A. a large quantity of exports is given up to obtain a unit of imports
- B. the volume of exports is greater than the volume of imports
- C. a smaller quantity of exports is given up to obtain a unit of imports
- D. the value of exports is greater than the value of imports
One of the advantages of international trade is that it?
- A. increases world output
- B. encourages economic independence among nations
- C. restricts spread of technical knowledge
- D. promotes self-reliance and satisfaction with only what can be produced internally
Personal distribution of income implies?
- A. the way in which income is distributed among specific households or spending units
- B. the distribution of income according to basic resources
- C. dividing income according to industries
- D. dividing income between personal taxes, consumption expenditures and savings
The average tax rate is defined as
- A. total tax rate less the marginal tax rate
- B. the tax rate which applies to additional value income
- C. the ratio of total taxes paid to total income
- D. marginal tax rate for being progressive
Budget deficit is the amount by which?
- A. total expenditure exceeds revenue
- B. recurrent expenditure exceeds revenue
- C. capital expenditure exceeds revenue
- D. recurrent expenditure exceeds capital expenditure
A tax that takes an increasing fraction of income as income goes down is called?
- A. conditional
- B. regressive
- C. progressive
- D. proportional
The term ‘Stock of Capital ‘means?
- A. amount of money necessary to start a business
- B. total amount receivable by all factors of production
- C. amount of equipment plant and inventory existing at a time
- D. total amount available for economic development
Banks aid economic expansion and development by?
- A. being very strict in lending policies
- B. mobilizing savings for investment lending
- C. paying interest on deposit accounts
- D. charging high interest on loans
An effect of inflation is that it?
- A. discourages trade by barter
- B. favours debtors at the expense of creditors
- C. increases the real income of salary earners
- D. increases the value of a country's exports
Fiduciary issue is that part of?
- A. the issue of notes backed entirely by gold
- B. a country's currency which is not negotiable
- C. the issue of notes not backed by gold
- D. a country's currency officially issued
To perform its function as a store of wealth and standard for deferred payment, money must be
- A. portable
- B. in attractive form
- C. stable in value
- D. spent more on capital goods than on consumer goods
One of the functions of Development Banks is to
- A. mint money for the development of the economy
- B. provide short-term loans to commercial banks
- C. provide medium and long-term finance for the development of the banking system
- D. provide medium and long-term finance for the development of the economy
One disadvantage of trade by barter is that?
- A. people are happier when they exchange the same quantities of goods through the medium of money rather than by barter
- B. the person wishing to buy good X may not have good Y which is what the other wants
- C. one person must always be cheated when trade takes place by barter
- D. it increases the intial cost of producing goods
Industries tend to be located closer to market centers than to the sources of major raw materials if the?
- A. products are relatively cheap to transport to market centers
- B. products are relatively more expensive to transport than the major raw materials
- C. raw marterials are bulky
- D. raw marterials can also be imported
A characteristic of a debenture is that?
- A. its yeild is based on profits
- B. its yeild is a fixed rate of interest
- C. it has no redemption date
- D. there is a voting right when interest is paid
A disadvantage of a joint-stock company is?
- A. unlimited liability
- B. limited liability
- C. continuity
- D. loss of controlling interest