Basic of Economics Mcqs - Set 8

1)   The amount value of an asset in business records is not necessarily identical to the amount that the asset could bring on the open market. What is it called ?

a. Open value
b. Book value
c. Real value
d. Artificial value
Answer  Explanation 

ANSWER: Book value

Explanation:
No explanation is available for this question!


2)   Governments and corporations sell interest bearing certificates to raise money for expansion or trade. What is called these certificates ?

a. Certificates
b. Sureties
c. Security bonds
d. Bond
Answer  Explanation 

ANSWER: Bond

Explanation:
No explanation is available for this question!


3)   Term the written order which directs that a specified sum of money be paid to a specified person ?

a. Bill of Exchange BE
b. Bill of Lading
c. Bearer Cheque
d. None of them
Answer  Explanation 

ANSWER: Bill of Exchange BE

Explanation:
No explanation is available for this question!


4)   Bearer cheque is ?

a. Payable to anyone
b. payable to person holding it
c. payable through account only
d. payable after specific period
Answer  Explanation 

ANSWER: payable to person holding it

Explanation:
No explanation is available for this question!


5)   Balance of sheet is understood as ?

a. Profit in a year
b. Statements of accounts that shows debit and credit accounts under the broad heads
c. Performance of a company
d. Accurate economic position
Answer  Explanation 

ANSWER: Statements of accounts that shows debit and credit accounts under the broad heads

Explanation:
No explanation is available for this question!


6)   The balance of payment is ?

a. Balance between a nation’s expenditure on imports and its receipts from exports
b. Total sum a state owned
c. Total liabilities of a nation
d. Shortfall in budget
Answer  Explanation 

ANSWER: Balance between a nation’s expenditure on imports and its receipts from exports

Explanation:
No explanation is available for this question!


7)   What is called an arrangement of workers machines, and equipment in which the product being assembled passes consecutively from operation to operation or the process in which finished products are turned out in a mechanically efficient, though impersonal, manner ?

a. Assembly line
b. Production line
c. Both of them
d. None of them
Answer  Explanation 

ANSWER: Both of them

Explanation:
No explanation is available for this question!


8)   National Income is essentially composed of ?

a. All wealth of a nation
b. Annual Income of the central government
c. All income of the people on a year
d. Income derived from taxes by the central government
Answer  Explanation 

ANSWER: All income of the people on a year

Explanation:
No explanation is available for this question!


9)   Government policy about exports and imports is called ?

a. Monetary policy
b. Fiscal policy
c. Commercial policy
d. Finance policy
Answer  Explanation 

ANSWER: Commercial policy

Explanation:
No explanation is available for this question!


10)   When aggregate supply exceeds aggregate demand ?

a. Business inventory accumulate
b. Unemployment exists
c. Price of consumer goods rise
d. People save more than they intended to save
Answer  Explanation 

ANSWER: Business inventory accumulate

Explanation:
No explanation is available for this question!


11)   Development means economics growth plus ?

a. Inflation
b. Deflation
c. Social change
d. Price stability
Answer  Explanation 

ANSWER: Social change

Explanation:
No explanation is available for this question!


12)   Which of the following terms refers to income that is saved and not invested ?

a. Capital
b. Deposit
c. Hoarding
d. Profit
Answer  Explanation 

ANSWER: Hoarding

Explanation:
No explanation is available for this question!


13)   What term is given to unemployment caused by a downturn in the business cycle ?

a. Underemployment
b. Disguised unemployment
c. Temporary unemployment
d. Cyclical unemployment
Answer  Explanation 

ANSWER: Cyclical unemployment

Explanation:
No explanation is available for this question!


14)   Devaluation of currency can help to increase exports if elasticity of demand of exportable items in other countries is ?

a. Less than one
b. Greater than one
c. Equal to one
d. Zero
Answer  Explanation 

ANSWER: Equal to one

Explanation:
No explanation is available for this question!


15)   Which of the following must always balance ?

a. Balance of visible trade
b. Balance of invisible trade
c. Balance on the current account
d. Balance of payments
Answer  Explanation 

ANSWER: Balance of invisible trade

Explanation:
No explanation is available for this question!


16)   If GNP of Pakistan rises. it will encourage ?

a. Exports
b. Imports
c. Both
d. None
Answer  Explanation 

ANSWER: Both

Explanation:
No explanation is available for this question!


17)   The branch banking system is in vogue in most countries of the world. In which country was it first developed?

a. South Africa
b. UK
c. Canada
d. Australia
Answer  Explanation 

ANSWER: UK

Explanation:
No explanation is available for this question!


18)   Theory of comparative advantages was presented by ?

a. Adam Smith
b. Ricardo
c. Hicks
d. Barron
Answer  Explanation 

ANSWER: Ricardo

Explanation:
No explanation is available for this question!


19)   Open market Operation is ?

a. Buying and selling bills of exchange
b. Buying and Selling govt. securities
c. Buying and selling shares of companies
d. Buying and selling foreign exchanges
Answer  Explanation 

ANSWER: Buying and Selling govt. securities

Explanation:
No explanation is available for this question!


20)   Central bank’s rate of lending to commercial banks is called ?

a. Interest rate
b. Discount rate
c. Money rate
d. Control rate
Answer  Explanation 

ANSWER: Control rate

Explanation:
No explanation is available for this question!


21)   Which is the most widely used tool of monetary policy ?

a. Clearing house
b. Open-market operations
c. Discount rate
d. Issuing of notes
Answer  Explanation 

ANSWER: Open-market operations

Explanation:
No explanation is available for this question!


22)   In which capacity does a person stand to gain from deflation ?

a. As a pensioner
b. As a debtor
c. As an entrepreneur
d. As an equity-holder
Answer  Explanation 

ANSWER: As a pensioner

Explanation:
No explanation is available for this question!


23)   Which of the following is not an instrument of monetary policy ?

a. Taxation
b. Bank rate
c. Open-market operations
d. Credit rationing
Answer  Explanation 

ANSWER: Taxation

Explanation:
No explanation is available for this question!


24)   When banks prepare their balance sheets. They show the money lent in ?

a. Liability
b. Assets
c. Both assets and liabilities
d. None
Answer  Explanation 

ANSWER: Assets

Explanation:
No explanation is available for this question!


25)   Which of the following would cause income to become more unequal ?

a. Increased employment
b. Increased unemployment allowance
c. More progressive taxes
d. More regressive taxes
Answer  Explanation 

ANSWER: More regressive taxes

Explanation:
No explanation is available for this question!


26)   Trade between two countries can be useful if cost ratios of goods are ?

a. Equal
b. Different
c. Undetermined
d. Decreasing
Answer  Explanation 

ANSWER: Different

Explanation:
No explanation is available for this question!


27)   Which property the paper money does not process ?

a. Acceptability
b. Divisibility
c. Durability
d. Portability
Answer  Explanation 

ANSWER: Durability

Explanation:
No explanation is available for this question!


28)   The govt. can control inflation by______________?

a. Increasing demand for goods
b. Increasing supply of goods
c. Increasing money supply
d. Decreasing taxes
Answer  Explanation 

ANSWER: Increasing supply of goods

Explanation:
No explanation is available for this question!


29)   When stock market is falling it is_______________?

a. Bearish
b. Bullish
c. Crash
d. Fall down
Answer  Explanation 

ANSWER: Bearish

Explanation:
No explanation is available for this question!


30)   What could a government do to correct the current account deficit ?

a. Reduce the deficit on the balance of trade
b. Reduce the repayment of loans
c. Reduce the surplus on the capital account
d. Reduce the volume of exports
Answer  Explanation 

ANSWER: Reduce the deficit on the balance of trade

Explanation:
No explanation is available for this question!