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An important distinction between a free trade area and a customs union is that
An important distinction between a free trade area and a customs union is thatA . Only a customs union erects a common external tariffB . Only a free trade area allows free internal trade in services as well in goodsC . Only a customs union is an example of a...
The level of national income in the circular flow will remain constant if
The level of national income in the circular flow will remain constant ifA . injections are greater than withdrawalsB . injections are equal to withdrawalsC . injections are equal to savingsD . injections plus withdrawals are equal to savings plus investmentView AnswerAnswer: B
Which of the following best defines a fiscal policy?
Which of the following best defines a fiscal policy?A . A policy that increases government spending to increase national incomeB . A policy which seeks to influence the economy through manipulation of government spending and taxationC . A policy aimed at influencing the level of aggregate demand in the economyD...
Identify from the list below the financial instrument that is not a method of government borrowing:
Identify from the list below the financial instrument that is not a method of government borrowing:A . Cash (i.e. notes and coins)B . TaxationC . Contributions to state-provided pensionsD . Government bondsView AnswerAnswer: B
A rise in interest rates in an economy would lead to all of the following except which one?
A rise in interest rates in an economy would lead to all of the following except which one?A . A rise in the exchange rate for the currencyB . A rise in personal savingC . An increase in business investmentD . A rise in public expenditureView AnswerAnswer: C
Which of the following is not taken into account by the discount factor applied to future earnings when calculating shareholder value?
Which of the following is not taken into account by the discount factor applied to future earnings when calculating shareholder value?A . Shareholders rate of time preference for moneyB . The amount of earnings that will be lost as taxationC . The amount of risk the investment is subject toD...
If in a boom a government adopted a contractionary (restrictive) monetary policy, a typical business would expect to experience:
If in a boom a government adopted a contractionary (restrictive) monetary policy, a typical business would expect to experience: i. Higher interest payments on its bank borrowing. ii. Falling credit based sales. iii. Higher income and corporate taxes. iv. Lower sales to government agencies. v. Difficulties in securing working capital...
All of the following are characteristics of a recession except which one?
All of the following are characteristics of a recession except which one?A . Rising levels of unemployment.B . Increased inflationary pressure.C . Improving trade balances.D . Increased government budget deficits.View AnswerAnswer: B
Which ONE of the following is NOT required in calculating the EPS of ABC plc?
Which ONE of the following is NOT required in calculating the EPS of ABC plc?A . The market price of ABC's shareB . The number of shares ABC has in issueC . The most recent earnings after interest and tax of ABCD . The dividend payment made to holders of...
In a recession, the central bank might adopt a policy of low interest rates.
In a recession, the central bank might adopt a policy of low interest rates. The businesses most likely to benefit from this are those which:A . Sell their products mostly on creditB . Have low gearing ratiosC . Are dependent on imported components and raw materialsD . Produce services rather...
