Economics MCQs

Option A: $100, 2 million barrels per day $60 million

Option B: $80, 4 million barrels per day $70 million

Option C: $60, 6 million barrels per day, $20 million

Option D: $40, 8 million barrels per day, $0 million

Correct Answer: $40, 8 million barrels per day, $0 million ✔

Option A: World Bank

Option B: International Monetary Fund

Option C: Council on Foreign Relations

Option D: Organization of petroleum Exporting Countries

Correct Answer: World Bank ✔

Option A: is the first of the East Asian countries to be recognized for a successful outward-oriented development strategy

Option B: has retained to the present time its strategy of import substitution as a source of economic growth

Option C: has always accounted for a significant share of international trade, given its very large population

Option D: has significantly increased its openness to international trade and foreign investment in recent decades

Correct Answer: has significantly increased its openness to international trade and foreign investment in recent decades ✔

Option A: has shown that is easy to achieve cooperation among cartel members

Option B: was successful in raising oil prices in the 1970s but was disbanded in the 1980s

Option C: has shown greater success in realizing profits during periods of global recession

Option D: has had a level of success in raising oil prices that other developing countries are unlikely to achieve with other primary commodities

Correct Answer: has had a level of success in raising oil prices that other developing countries are unlikely to achieve with other primary commodities ✔

Option A: labor forces increase

Option B: capital stocks increase

Option C: new inventions increase productivity

Option D: All of the above

Correct Answer: All of the above ✔

Option A: relatively greater than

Option B: relatively less than

Option C: the same as

Option D: Any of the above

Correct Answer: relatively less than ✔

Option A: purchase; decrease

Option B: purchase; increase

Option C: sell; increase

Option D: sell; decrease

Correct Answer: sell; increase ✔

Option A: developing country export to advanced countries to receive preferential tariff treatment

Option B: developing country imports from advanced countries to receive preferential tariff treatment

Option C: any developing country to ignore the most-favored nation clause

Option D: any advanced country to ignore the most favored-nation clause

Correct Answer: developing country export to advanced countries to receive preferential tariff treatment ✔

Option A: relatively low import tariffs maintained by advanced countries

Option B: highly elastic demand for these products in advanced countries

Option C: declines in the supplies of these products on world markets

Option D: sluggish demand for these products in advanced countries

Correct Answer: sluggish demand for these products in advanced countries ✔

Option A: higher than

Option B: equal to

Option C: lower than

Option D: there is no general pattern

Correct Answer: lower than ✔

Option A: primary products such as tin and bauxite

Option B: intermediate products

Option C: labor-intensive agricultural products

Option D: labor-intensive manufacturing products

Correct Answer: primary products such as tin and bauxite ✔

Option A: lower tariff rates on goods from nations with normal trade relation status

Option B: lower tariff rates on goods from nations with most favored nation status

Option C: low or zero tariffs on goods from certain developing countries

Option D: identical tariff rates in products from all countries of the world

Correct Answer: identical tariff rates in products from all countries of the world ✔

Option A: the world Bank

Option B: the international Monetary Fund

Option C: The Generalized System of Preferences

Option D: All of the above

Correct Answer: All of the above ✔

Option A: tariff-rate quotas applied to imported goods

Option B: production and export controls

Option C: buffer stocks

Option D: multilateral contracts

Correct Answer: tariff-rate quotas applied to imported goods ✔

Option A: international commodity agreements program

Option B: multilateral contract program

Option C: generalized system of preferences program

Option D: export-led growth program

Correct Answer: generalized system of preferences program ✔

Option A: be a manufactured goods

Option B: be a primary product

Option C: have high price elasticity of supply

Option D: have a low price elasticity of demand

Correct Answer: have a low price elasticity of demand ✔

Option A: normal trade relation status

Option B: most favored nation status

Option C: offshore assembly provisions

Option D: Generalized System of Preferences

Correct Answer: Generalized System of Preferences ✔

Option A: mixed evidence that does not substantiate the deterioration hypothesis

Option B: overwhelming support for the deterioration hypothesis

Option C: overwhelming opposition to the deterioration hypothesis

Option D: None of the above

Correct Answer: mixed evidence that does not substantiate the deterioration hypothesis ✔

Option A: export promotion

Option B: import promotion

Option C: international commodity agreements

Option D: multilateral contracts

Correct Answer: export promotion ✔

Option A: international dumping

Option B: countervailing duties

Option C: Strategic trade policy

Option D: export promotion policy

Correct Answer: Strategic trade policy ✔

Option A: eliminate all tariffs between countries

Option B: increase all tariffs between countries

Option C: maintain a nondiscriminatory structure of tariffs

Option D: maintain a discriminatory structure of tariffs

Correct Answer: maintain a nondiscriminatory structure of tariffs ✔

Option A: increase consumer surplus in the importing country

Option B: decrease producer surplus in the importing country

Option C: impose a price floor on foreign prices in the importing country

Option D: impose a price ceiling on foreign price in the importing country

Correct Answer: impose a price floor on foreign prices in the importing country ✔

Option A: predatory dumping represents the most common form of dumping by U.S firms

Option B: U.S firms can obtain protection from foreign dumping, even though this protection tends to harm overall U.S welfare

Option C: dumping can never be a profit-maximizing strategy for U.S firms to pursue

Option D: U.S firms rarely if ever, engage in distress dumping or persistent dumping

Correct Answer: U.S firms can obtain protection from foreign dumping, even though this protection tends to harm overall U.S welfare ✔

Option A: generalized system of preference

Option B: countervailing duty

Option C: domestic content

Option D: safeguards

Correct Answer: safeguards ✔

Option A: are abolished by the World Trade Organization

Option B: result in decreases in consumer surplus for domestic households

Option C: are imposed by industrial countries but not developing countries

Option D: result in lower-priced goods for domestic consumers

Correct Answer: result in decreases in consumer surplus for domestic households ✔

Option A: it reduces the sovereignty of member countries

Option B: favors free trade over the quality of the environment

Option C: it has no way to solve trade disputes among member countries

Option D: it is a puppet of multinational corporations

Correct Answer: it has no way to solve trade disputes among member countries ✔

Option A: decreases, decreases

Option B: decreases, increases

Option C: increases, decreases

Option D: increases, increases

Correct Answer: decreases, increases ✔

Option A: 5 radios

Option B: 10 radios

Option C: 15 radios

Option D: zero radios

Correct Answer: zero radios ✔

Option A: decrease the level of national security

Option B: provide benefits to some particular industry

Option C: provide benefits to the entire nation

Option D: not yield welfare losses for the nation

Correct Answer: provide benefits to the entire nation ✔

Option A: the WTO

Option B: the GATT

Option C: the IMF

Option D: the World Bank

Correct Answer: the GATT ✔

Option A: Nontariff barriers (NTBs) and tariffs have increased in relative importance

Option B: NTBs and tariffs have decreased in relative importance

Option C: NTBs have increased and tariffs have decreased in relative importance

Option D: NTBs have decreased and tariffs have increased in relative importance

Correct Answer: NTBs have increased and tariffs have decreased in relative importance ✔

Option A: U.S grains consumers and producers of bread

Option B: U.S farmers and grains companies

Option C: Grain Producers in foreign countries

Option D: Grain consumers in foreign countries

Correct Answer: U.S farmers and grains companies ✔

Option A: are prohibited by the World Trade Organization

Option B: affect international trade but not international financial flows

Option C: involve restrictions on imports, but not exports

Option D: involve restrictions in imports exports and or financial flows

Correct Answer: involve restrictions in imports exports and or financial flows ✔

Option A: have tariff rates equal to zero suggesting a free trade policy for the United States

Option B: have lower tariff rates than the rates that apply to any other country sending goods to the United States

Option C: have tariff rates that are identical to the rates that apply to other countries to which the U.S grants most-favored nation treatment

Option D: have lower tariff rates than the rates that apply to other countries to which the U.S grants most favored nation treatment

Correct Answer: have tariff rates that are identical to the rates that apply to other countries to which the U.S grants most-favored nation treatment ✔

Option A: World Bank

Option B: International Trade Commission

Option C: Department of justice

Option D: World Trade Organization

Correct Answer: World Trade Organization ✔

Option A: Kennedy Round of 1964-1967

Option B: Tokyo Round of 1973-1979

Option C: Uruguay Round of 1986-1993

Option D: Doha Round of 2003-2007

Correct Answer: Uruguay Round of 1986-1993 ✔

Option A: embargoes

Option B: tariff-rate quotas

Option C: voluntary export restraints

Option D: nontariff barriers

Correct Answer: embargoes ✔

Option A: increase

Option B: decrease

Option C: not change

Option D: None of These

Correct Answer: increase ✔

Option A: Canada

Option B: Australia

Option C: Japan

Option D: China

Correct Answer: China ✔

Option A: General Agreement on Tariffs and Trade

Option B: World Trade Organization

Option C: Smoot Hawley Organization

Option D: McKinley Agreement on Trade policy

Correct Answer: General Agreement on Tariffs and Trade ✔

Option A: bilateral tariff reductions to promote trade liberalization

Option B: the use of the most-favored nation clause (normal trade relations)

Option C: nondiscrimination in trading relationships

Option D: the prohibition of import quotas and export quotas

Correct Answer: bilateral tariff reductions to promote trade liberalization ✔

Option A: The price of radios in Mexico equals $60 and its imports equal 30 radios

Option B: The price of radios in Mexico equals $30 and its imports equal 30 radios

Option C: The price of radios in Mexico equals $40 and its imports equals 20 radios

Option D: Th price of radios in Mexico equals $20 and its imports equal 40 radios

Correct Answer: The price of radios in Mexico equals $30 and its imports equal 30 radios ✔

Option A: foreign dumping of goods in the U.S

Option B: subsidies granted to foreign firms that export to the U.S

Option C: buy national policies of foreign government

Option D: stringent environmental regulations of foreign government s

Correct Answer: subsidies granted to foreign firms that export to the U.S ✔

Option A: charge the nation’s products a lower tariff than any other nation’s

Option B: charge that nation’s products a tariff rate no higher than that on any other nation

Option C: charge that nation’s products a higher tariff than any other nation’s

Option D: exports to that nation any products that it wants to purchase

Correct Answer: B. charge that nation’s products a tariff rate no higher than that on any other nation ✔

Option A: domestic workers lobbying for import restriction

Option B: domestic workers lobbying for export restrictions

Option C: domestic consumers lobbying for export restrictions

Option D: domestic consumers lobbying for import restrictions

Correct Answer: domestic consumers lobbying for import restrictions ✔

Option A: lesser it initial dependence on foreign produce goods.

Option B: more elastic the target country demand schedule

Option C: greater then available output from alternative suppliers

Option D: more in elastic the target country supply scheduleB.

Correct Answer: ✔

Option A: Grain prices would rise in the Soviet union

Option B: Consumer surplus would decrease for the soviets

Option C: Grains prices would rise in the united States

Option D: Export revenues would decrease for U.S producers

Correct Answer: Grains prices would rise in the united States ✔

Option A: Deficit Budget

Option B: Reduction in taxation

Option C: Increase in public expenditure

Option D: Reverse of inflation

Correct Answer: Reverse of inflation ✔

Option A: Cost ratios are different

Option B: Tariff rates are different

Option C: Price ratios are different

Option D: A and C of above

Correct Answer: A and C of above ✔

Option A: Promissory note

Option B: Currency note

Option C: Exchange rate

Option D: Bank cheque

Correct Answer: Currency note ✔

Option A: Feudal System

Option B: Capitalist System

Option C: Fascist System

Option D: Communist System

Correct Answer: Communist System ✔

Option A: Gold currency

Option B: Hard currency

Option C: Silver currency

Option D: Soft currency

Correct Answer: Soft currency ✔

Option A: Brl

Option B: Bel

Option C: Bbl

Option D: Obl

Correct Answer: Bbl ✔

Option A: Policy about markets

Option B: Policy about money supply

Option C: Policy about imports and exports

Option D: Policy of controlling of prices of goods

Correct Answer: Policy about imports and exports ✔

Option A: Frankfurt

Option B: Bonn

Option C: Berlin

Option D: Stuttgart

Correct Answer: Bonn ✔

Option A: Balance of trade

Option B: Capital receipts and payments

Option C: Savings and investment account

Option D: A and B of above

Correct Answer: A and B of above ✔

Option A: Accepting public deposits

Option B: Granting loan and advances

Option C: Undertaking agency functions

Option D: Banker to the government

Correct Answer: Banker to the government ✔

Option A: Micro Finance Bank

Option B: Moderba Bank

Option C: SME- Bank

Option D: First MINI Bank

Correct Answer: Micro Finance Bank ✔

Option A: Getting short term loans

Option B: Getting long term loans

Option C: Treasury bill in not credit instrument

Option D: Treasury bill is a govt. tax bill

Correct Answer: Getting short term loans ✔

Option A: Buys govt. securities in stock market

Option B: Sells govt. securities

Option C: Lowers discount rate

Option D: B and C of above

Correct Answer: Sells govt. securities ✔

Option A: The exchange rates

Option B: The interest rates

Option C: The money supplies

Option D: The real national income

Correct Answer: The money supplies ✔

Option A: Low rate of interest

Option B: Very low rate of interest

Option C: High rate of interest

Option D: Very high rate of interest

Correct Answer: Very low rate of interest ✔

Option A: The cash reserve requirement

Option B: The amount of cash available

Option C: The number of branches of a bank

Option D: A and B of above

Correct Answer: A and B of above ✔

Option A: 1st September

Option B: 1st January

Option C: 1st April

Option D: 1st July

Correct Answer: 1st July ✔

Option A: Increase the volume of trade

Option B: Reduces the volume of trade

Option C: Has no effect on volume of trade?

Option D: A and C of above

Correct Answer: Reduces the volume of trade ✔

Option A: The number of times a unit of money changes hands daily

Option B: The number of times as unit of money changes hands monthly

Option C: The number of times a unit of money changes hands annually

Option D: The number of times a unit of money changes value

Correct Answer: The number of times a unit of money changes hands annually ✔

Option A: Availability of gold in the country

Option B: Availability of dollars in the country

Option C: Demand for money in the country

Option D: Tax collection

Correct Answer: Demand for money in the country ✔

Option A: Increase in nominal GNP

Option B: Increase in real GNP

Option C: Increase in personal income

Option D: Increase in government revenue

Correct Answer: Increase in real GNP ✔

Option A: Bearish

Option B: Bullish

Option C: Hottest

Option D: Rising up

Correct Answer: Bullish ✔

Option A: An increases demand for its exports

Option B: Increased demand for its imports

Option C: An increased inflow of capital

Option D: None of the above

Correct Answer: Increased demand for its imports ✔

Option A: Increase in money supply

Option B: Fall in production

Option C: Increase in money supply and fall in production

Option D: Decrease in money supply and fall in production

Correct Answer: Increase in money supply ✔

Option A: Price increase demand decreases

Option B: Price decreases demand decreases

Option C: Price increased demand increases

Option D: None of these

Correct Answer: Price increase demand decreases ✔

Option A: Foreign income

Option B: Capital consumption allowance

Option C: Indirect taxes

Option D: Direct taxes

Correct Answer: Capital consumption allowance ✔

Option A: Total expenditure is more than total revenue

Option B: Current expenditure is more than current revenue

Option C: Capital expenditure is more than capital revenue

Option D: Total expenditure is more than current revenue

Correct Answer: Total expenditure is more than total revenue ✔

Option A: An increase in indirect taxes

Option B: An increase in managers salaries

Option C: An increase in progressive taxation

Option D: An increase in the rate of inflation

Correct Answer: An increase in progressive taxation ✔

Option A: Is the same as economic growth

Option B: Means improvement in lifestyle

Option C: Exists when there is equal distribution of income

Option D: All of the above

Correct Answer: Means improvement in lifestyle ✔

Option A: Investment

Option B: Subsidies

Option C: Taxation

Option D: Consumption

Correct Answer: Taxation ✔

Option A: Household’s purchases of food

Option B: Households’ purchase of a car

Option C: Household’s payment of rent for an apartment

Option D: Household’s purchase of stock in any XYZ corporation

Correct Answer: D. Household’s purchase of stock in any XYZ corporation ✔

Option A: Gross investment minus household investment

Option B: Gross investment minus govt. Investment

Option C: Gross investment minus capital consumption allowance

Option D: None of the above

Correct Answer: Gross investment minus capital consumption allowance ✔

Option A: Total sales in the economy

Option B: Total monetary transactions in an economy

Option C: The market value of all goods and services produced in an economy

Option D: Total spending in an economy

Correct Answer: The market value of all goods and services produced in an economy ✔

Option A: Expenditure method

Option B: Income method

Option C: Product method

Option D: All of the above

Correct Answer: All of the above ✔

Option A: Fall in prices due to less circulation of currency

Option B: Fall in employment due to declining production

Option C: High inflation rate combined with high unemployment and unchanged consume demand

Option D: None of these

Correct Answer: High inflation rate combined with high unemployment and unchanged consume demand ✔

Option A: Changes in price caused by changes in demand

Option B: The rate of change of sales

Option C: The responsiveness of demand to price changes

Option D: The value of sales at a given price

Correct Answer: The responsiveness of demand to price changes ✔

Option A: Increasing government spending

Option B: Increasing public ownership of firms

Option C: Increasing the role of markets

Option D: Removing the profit motive

Correct Answer: Increasing the role of markets ✔

Option A: Bank loans

Option B: The payment without work

Option C: Tax payments

Option D: Payments made to all factors of production

Correct Answer: The payment without work ✔

Option A: National income

Option B: Per capita income

Option C: Poverty ratio

Option D: None of these

Correct Answer: Per capita income ✔

Option A: Local tax

Option B: Indirect tax

Option C: Direct tax

Option D: Rate

Correct Answer: Direct tax ✔

Option A: A new investor

Option B: A old investor

Option C: A member of the stock exchange who cannot meet his obligations

Option D: None of the above

Correct Answer: A member of the stock exchange who cannot meet his obligations ✔

Option A: Reliance Industries Ltd.

Option B: British Gas

Option C: General Motors

Option D: State Bank

Correct Answer: Reliance Industries Ltd. ✔

Option A: National income

Option B: Saving

Option C: Imports at lower cost

Option D: Exports

Correct Answer: Exports ✔

Option A: Fall

Option B: Rise

Option C: Fluctuate

Option D: Remain constant

Correct Answer: Remain constant ✔

Option A: Acting as bankers to the government

Option B: Advising the government on monetary policy

Option C: Dealing in foreign exchange

Option D: Fixing the main interest rate

Correct Answer: Dealing in foreign exchange ✔

Option A: Income on which payment of tax is usually evaded

Option B: Illegally earned money

Option C: Money earned through underhand deals

Option D: None of these

Correct Answer: Income on which payment of tax is usually evaded ✔

Option A: Japan

Option B: South Korea

Option C: Taiwan

Option D: Malaysia

Correct Answer: Japan ✔

Option A: commercial bank deposits

Option B: government bank deposits

Option C: government spending

Option D: interest rates

Correct Answer: interest rates ✔

Option A: increasing bank lending

Option B: increasing import duties

Option C: reducing government expenditure

Option D: None of these

Correct Answer: reducing government expenditure ✔

Option A: Debtors

Option B: Creditors

Option C: Business class

Option D: None of these

Correct Answer: Creditors ✔

Option A: Milton Friedman

Option B: Adam smith

Option C: Alfred Marshal

Option D: Karl Marx

Correct Answer: Milton Friedman ✔

Option A: Converting rupee into gold

Option B: Lowering of the value of one currency in comparison of some foreign currency

Option C: Making rupee dearer in comparison to some foreign currency

Option D: None of these

Correct Answer: Lowering of the value of one currency in comparison of some foreign currency ✔

Option A: Stagnation

Option B: Take-off stage in economy

Option C: Stagflation

Option D: None of these

Correct Answer: Stagflation ✔