1) Adverse selection can be caused by ....
A. market failure
B. moral hazard
C. asymmetric information
D. average risk
2) What do people use when they form their views about the future that assumes they do?
A. Past trends
C. Symmetric information
D. Average risk
3) What does advertising manipulate?
A. Consumer desire.
B. Consumer taste.
C. Consumer sensitivity.
D. Consumer loyalty
4) What does advertising intensify?
A. Asymmetric information.
B. A better deal.
D. Flow of information.
5) What does the principal want the managers do?
A. To build a business empire
B. To expand the firm through an acquisition
C. To pursue his/her own empire building interests
D. To maximize the value of their shares
6) What is too expensive or too difficult to do in reducing agency costs?
A. To pay managers partly with shares
B. To make the interests of the agent more like those of the principal
C. To give the managers a powerful incentive to act in the interests of the owners
D. To monitor what the agent does
7) How does the government do to guarantee a minimum level of farm pr1. ces?. B y ....
A. minimizing competition to EU farmers
B. destroying it if prices would fall
C. joining the EU
D. subsidizing agriculture
8) What makes global agriculture market remain severely distorted?
A. Government subsidy
B. Smaller national income
C. Free trade
D. Smaller share of employment
9) What assumes that self-interested individuals behave altruistically?
A. Behavioural economics.
B. Economic man.
C. Economic rationality.
D. Economic analysis.
1 0) What assumes that people behave selfishly?
A. Behavioural economics.
B. Economic analysis.
C. Economic man.
D. Economic rationality.
11) What does the borrower pay when loans are not amortized?
A. the sum borrowed in full
C. only interest
12) What is the other name of confidence?
A. Expectation of death
B. Naive optimism
C. Animal spirits
D. Economic prospects
13) In the United States, monopoly policy is based on ...
A. Sherman Antitrust Act of 1890
B. Economic theories from the Chicago School
C. American Antitrust policy
D. Laissez-faire approach
14) Who includes "robber baron"?
A. AT & T
B. JP Morgan
15) What is the guilty of Microsoft?
A. Nationwide software monopoly
B. Predatory pricing
C. Anti-competitive behaviour
D. Exclusive marketing agreement
16) Pure arbitrage has become rare in recent years partly because of ....
A. hedge funds
B. globalization of fmancial markets
C. financial securities
D. risk profit
1 7) What is one of the few key risk factors?
A. Expected rate of asset
B. Capital asset pricing model
C. Financial asset
D. Arbitrage pricing theory
18) What causes the Asian crisis precisely?
A. Currency peg
B. Economic contagion
D. lack of transparency
19) What did the Asian crisis bring to an end?
A. Reduction of capital control
B. 'Asian way' of capitalism
C Corporate loans
D. Ill-disciplined banking
20) What can asymmetric information account for?
B. The low quality of the car being sold.
C. Cheap broadcasting licenses.
D. Significant inefficiencies.
21) Asymmetric shock could be a constant problem for those responsible for?
A. Setting a macroeconomic policy.
B. Deciding the interest rate for a country's currency.
C. Boosting demand that might be unsuited to the needs of the rest of the economy.
D. Exporting oil.
22) In Dutch auction, who calls out a high price?
A. The auctioneer
B. The winner
C. The bidder
1) When future prices are higher than spot prices it is called ...
D. temporary bottleneck
2) What includes current account?
A. Money invested in foreign currency.
B. Money invested in foreign firms.
C. Profits made by selling those investments.
3) What kind of crisis the Russian Government faced in 1998?
A. Balance of payment crisis.
B. Financial crisis.
C. Current account deficit.
D. Public sector crisis.
4) A process in which traditional banks are selling off their loans in the financial markets is called ...
C. credit creation
5) One of the financial bias that has separated different forms of banking from each other and kept banks out of insurance business is called ...
B. corporate bonds
C. glass-steagall act
D. credit creation
6) Banks that concentrate on raising money for companies from private investors by finding buyers for their equity and corporate bonds are called ...
A. merchant banks
B. retail banks
C. universal banks
D. wholesale banks
7) What will banks in America do with a bankrupt firm?
A. They will close it down
B. They will give it some more time to solve its problems
C. They will try to repay its debts by selling off any assets it has
D. They will allow it to borrow more money
8) Barter is popular when ....
A. taxation is low
B. people are not asset-rich
C. inflation is low
D. quality of money is certain
9) How can powerful firms discourage entry? By ...
A. producing a large output at lower costs
B. spending lots of money on things such as advertising
C. incurring huge sunk costs
D. making firing an expensive process
1 0) Basel 2 was delayed until 2005 as ...
A. it was bailed out by the IMF in 1998
B. there was controversy over these more sophisticated risk classifications
C. it ties a bank's capital adequacy ratio to the riskiness of the loans it makes
D. it penalized banks no more for making loans to South Korea
11) How many basis points did the exchange rate fall if it moved from 6.85% to 6.50%?
12) What do traditionalists try to show?
A. people are influenced by outside suggestion
B. people are prone to cognitive dissonance
C. people are persistently and irrationally overconfident
D. people make individual decisions in teh context of the big picture
13) How many percents does the black economy add to GDP?
14) How many percents of change in the market if a company's shares have a beta of0.7% and on average the share price will change by 0.7 %?
15) A notion that a dollar should buy the same amount in all countries is
called the ...
A. big mac index
B. black economy
C. purchasing power parity
D. exchange rate
16) Who invented the Big Mac Index ?
A. Fisher Black
B. Pam Woodall
C. Myron Scholes
D. Robert Merton
17) Bands are regarded as a lower risk investment because ...
A. they are almost unlikely to miss their promised payments
B. they can raise capital
C. they can sell shares
D. they can take out a bank loan
18) What is the basis of all brand values?
A. Consumer's choice.
B. Consumer's preference.
C. Consumers' gain.
D. Consumer trust.
19) What sets rates mostly? By ....
A. exchange rates
B. balance of payments
D. market forces
20) What is the name of bubble in Britain during the 18th century?
A. Real estate
B. South Sea
Buyer's market is a market in which supply seems plentiful and prices
seem low; the opposite of a seller's market.
1. How long did the average expansion last?
2. How long did the average expansion last?
A. 8 years
B. 20 years
C. 50 years
D. More than 50 years
3. What is the cause of Kit chin cycle?
A. House building
B. Fluctuation in companies' inventories
C. Changes in investment in plant and machinery
1) What innovation often takes form?
A. new products
C. technology-intensive economy
D. creative destruction
2) What includes working capital?
C. raw materials
3) How is market's risk contribution captured? By
A. valuing assets
B. measuring beta
C. calculating the cost of capital
D. using the capital asset pricing model
4) How do we know that our investments are safe?
A. close to zero
B. above zero
D. under zero
5) What includes capital asset?
6) Capital controls are not limits on ...
A. local investment
B. direct investment
C. foreign investment
D. domestic residents' investment
7) When did Asian countries begin to loosen their widespread capital controls?
8) Where is short-term capital raised?
A. Capital markets
B. Financial markets
C. Money markets
D. Secondary markets
9) Companies finance themselves by using ...
1 0) What is capitalism built on?
A. Private ownership
C. Property rights
D. Free-market system
11) When was Bank of England established?
12) Cartel is common when there is ...
13) Who guides short-term needs of an economy?
A. Central bank
D. an independent central bank
14) By 2003 how many winners of the Nobel Prize For Economics come from University of Chicago?
15) Who said that charitable giving is something that must be avoided?
B. Some people
C. Some economists
D. Other economists
16) Who attacked some of the main beliefs of classical and neo-classical economics?
A. John Maynard Keynes
B. John Stuart
C. Adam Smith
D. David Ricardo
17) In the capital market equilibrium was determined by ...
A. total savings
B. movements in wages
C. total investment
D. changes in the rate of interest
18) What does commoditization bring about?
A. High price
B. High profit margin
C. Fierce competition
D. Faster pace of innovation
19) What do followers of modem Marx think of the Soviet Union?
A. It failed to put communism into practice
B. Soviet missed the point
C. It is the enemy of capitalism
D. It is now nearly extinct
20) A country's comparative advantage will be ...
21) If each country specializes in products in which it has a comparative advantage, but will ...
A. have absolute advantage
B. consume more
C. have comparative advantage in anything
D. gain from trade
22) According to Krugman, international trade is ...
A. not a zero-sum game
23) A country's future prosperity depends on ...
A. its growth in economy
B. its growth in business
C. its growth in economic performance
D. its growth in productivity
24) How much is the compound interest of the deposit account of $100 at the
end of third year?
25) Which of the following goods are complementary?
A. Ferrari and BMW
B. Ducati and Honda
C. F1 car and Me Laren Mercedes engines
D. Dell and HP computers
26) A high degree of competition is shown by ...
A. a lack of competition
B. difficulty in exercising market power
C. using the Herfindahl-Hirschman Index
1) When was deflation as likely as inflation?
A. Since 1930
B. In 1666
C. On the eve of theW orld War I
D. Before 1930
2) What is the most serious problem deflation can cause?
B. Bank failure
C. Monetary policy ineffective
D. Real burden of debt
3) When public spending exceeds government revenue ...
A. a budget deficit occurs
B. a default occurs
C. deflation occurs
D. great depression occurs
4) The demand curve measures the relationship between ...
A. the price of a service and the amount of it demanded
B. the price of a good and the amount of it demanded
C. the goods and demand
D. the services and demand
5) What do monetarists use to manage demand?
A. Money supply
B. Fine tuning
C. Aggregate demand
D. Fiscal policy
6) Fertility rates fall because ...
A. unemployment rises
B. public spending increases
C. the state increasingly look after retired people
D. taxes are higher
7) What does deposit insurance reduce?
C. Moral hazard
D. Systemic risk
8) Savers who invest in abroad bank would probably earn much higher returns because ...
A. it has much more deposit insurance
B. it could invest in riskier business
C. it offers more profit
D. it has higher interest
9) A slump is where output falls by at least. ..
1 0) What is the aim of deregulation?
A. To increase competition
B. To cut red tape
C. To remove legal or quasi-legal restrictions
D. To remove prices charged within a particular industry
11) A derivative that is not traded on an exchange but is purchased from, for instance, an investment bank is called ...
A. a swap
B. an option
C. an over-the-counter
D. a future
12) Higher public spending relative to GDP is usually associated with ...
A. typical developing country
B. slower growth
C. developed-world economics
13) In recent years devaluation is caused by ...
A. higher prices
C. fixed exchange rate
D. financial speculation
14) Diminishing returns is also known as ...
A. economies of scale
B. catch-up effect
C. new economy
D. diseconomies of scale
15) According to some economists, who do not exist in traditional tribal societies?
A. Rational individual
B. Self-interested individual
C. Modern individual
D. Self-oriented individual
16) What continued to rise although rates were cut?
A. Indirect taxation
B. Income tax
C. Direct taxation
D. Inefficient method of taxation
17) What do firms use to judge whether an investment project is worthwhile?
A. Opportunity cost
B. Interest rate
C. Discounted cash flow
18) What kind of signal that let the shareholders know that the company is in a bad way?
A. A dividend cut
B. Share price cut
C. Interest rate cut
D. Budget cut
19) What should diversified firms do in order to make their shareholders much better off?
A. Sell off their non-core business
B. Hold several different shares
C. Hold several assets
D. Reduce risk
1) A firm that has the ability to set prices in its market is called ...
A. dominant firm
B. diversified firm
C. local firm
D. foreign firm
2) What currency did the European countries use before euro?
C. Their own currency
D. Pound sterling
3) What is the other name of dumping?
C. Predatory pricing
1) What happens when the euro economies are not growing in unison?
A. It falls sharply against other currencies
B. Intense pressure for interest cuts
C. Limitation of budget deficits
D. Monetary policy risks being too loose for some countries
2) What do the econometricians search when they crunch data?
A. Economic relationships that have statistical significance
B. Optimal currency area
C. Large transfers of funds
D. Euro-zone functions
3) Under what auspices when sanctions are multilateral?
A. Many countries
B. The United Nations
C. Some particular countries
D. One country
4) The health of an economy is judged by ...
A. the rate of currency
B. how big the economic sanctions are
C. the rate of inflation
D. how big the investment is
5) How big the sanctions between 1914-1990 failed to achieve their stated
6) What have mainstreams economists tried to do?
A. To prove that people acted in their own self-interest
B. To prove that society was made better off by everybody pursuing their selfish interests through the workings of the invisible hand.
C. To draw on psychological insights into human behavior to explain economic phenomena.
D. To include a broader range of human motivations
7) What does Thomas Carlyle think about economics?
8) The average cost of each unit produced falls because ...
A. industries are getting bigger
B. it is more difficult to manage a big operation
D. output decreases
9) The benefit of efficiency wages is to ...
A. encourage workers
B. set the wages above the market
C. increase the workers' productivity
D. set the market clearing rate
10) What does the efficient market hypotheses respond to?
A. Unexpected news.
B. All the information available.
C. Price of a financial asset.
D. Investment value.
11) If the goods are complementary goods the cross-elasticity will be ...
12) The good is inelastic if the percentage change in quantity is ...
A. the same as the percentage change in price
B. higher than the percentage change in price
C. less than the percentage change in price
D. more than the percentage change in price
13) According to Engel's law, the share of food in total spending increases as ...
A. incomes grow
B. incomes remain the same
C. incomes are up and down
D. incomes decreases
14) As people's income rises, they spend their budget on food ...
D. stay the same
15. What is the cause of Enron' s bankruptcy?
A. Accounting fraud.
16) What is involved in the Enron's system of employment evaluation?
A. Superior review.
B. Peer review.
C. Inferior review.
D. All the management reviews.
17) One way to reduce externalities is to ...
A. fine them
B. charge them
C. tax them
D. limit them
18) What spoil the conventional calculations?
19) What kind of discount rate should be used for costs and benefits arising during the first 30 years or so?
B. Much lower.
C. Much higher.
20) When supply and demand are balanced simultaneously in all the markets in an economy is called ...
A. general equilibrium
D. full employment
21) The reason shares are also known as equities is ...
B. welfare economics
D. the ownership right
22) What must be traded off against efficiency?
B. Economic activity
D. Welfare economics
23) When was euro circulated? Since ...
24) European Central Bank replaces ...
A. Bank of England
B. National Central Banks
C. Germany's BundesBank
D. Banque de France
25) How many countries that become initial members of the European Economic Community?
26) What includes disequilibrium process?
27) Excess returns can only be earned when there is ...
A. factors of production
B. perfect competition
C. market failure
D. economic investment
28) Economic and Monetary Union makes a number of ...
A. Asian currencies
B. European currencies
C. American currencies
D. African currencies were permanently fixed
29) What happens when currencies move from one equilibrium to another? They are ...
30) Expenditure tax is more efficient than other taxes because ...
A. it can be a form of indirect taxation
B. it adds to the price of a good or service
C. it levies on people's income
D. it may discourage productive economic activity less
31) The rate of technological progress can be ...
1) Factory prices are also called as ...
A. consumer prices
B. producer prices
C. wholesaler process
D. retailer prices
2) What does the writer say about fairness?
A. It is a good thing
B. It is not enough
C. It is impossible
D. There is no such thing as fairness
3) How many governors does the Federal Reserve Board have?
4) How many Federal Reserve districts does the Fed have?
5) What includes financial asset?
6) Where is one of the big financial centers?
7) Keep the economy growing at a steady rate is difficult because ...
A. there are frequent adjustments
B. of long-term macroeconomic goals
C. of inadequacies of economic forecasting
D. there are some attempted fine tuning
8) Sophisticated economic theories tackle issues inside firms such as ...
A. different incentives influencing individuals working within companies
B. corporate governance structures
C. short-term arrangements with outsiders
D. long-term arrangements with outsiders
9) What benefit can be enjoyed by followers?
A. The mistakes made by the first mover.
B. They can erect barriers to entry.
C. They can gain big profit.
D. Potential rivals may be discouraged.
10) Fiscal drag is an automatic stabilizer because ...
A. it helps slow the rate of increase in demand
B. it is less likely o result in higher inflation
C. it reduces the pace of growth
D. it acts naturally to keep demand stable
11) A balanced budget is ...
C. • growing
12) What is the percentage of public spending in Germany?
D. 40% of GDP
13) The number of shares sold by the original private investors is called ...
14) What is the significant form of Foreign Direct Investment?
A. New subsidiaries
D. Service industries
15) What do economists typically regard FDI now? As ....
D. corporate imperialism
16) What are often at risk of free riding?
A. Cheap good
B. Expensive goods
C. Public service
D. Public goods
17) What stimulates the growth of world trade?
C. World Trade Organization (WTO)
D. Comparative advantage
18) Most trade occurs between ...
A. countries that sell similar things to each other
B. countries that do not have huge cost differences
C. countries that have differences in consumer tastes
D. countries that stem from their particular stock of natural resources
19) Milton Friedman is an adviser to ...
A. Richard Nixon
B. Margaret Tatcher
C. General Pinochet
D. Friedrich Hayek
20) Frictional unemployment occurs because ...
A. there is technically full employment
B. some people get fired
C. people have difficulty in finding jobs
D. most people change jobs from time to time
21) What does MR Friedman praise?
A. Free trade
B. Free market
C. Free country
1) G21 lobbies for more free hade in ....... .
2) G8 consists of the G7 countries and ........ .
3) What has the potential to make all the players richer?
A. The zero - sum game
B. The game theory
C. The monopolistic competition
D. The positive- sum game
4) At what factor GDP can be calculated?
D. Public spending
5) The effect of inflation can be eliminated by measuring ....
A. GNP growth
B. Economic growth
C. Production growth
D. GDP growth
6) What do must economists think about general equilibrium?
A. Something worth aspiring to
B. Something worth achieving to
C. Something worth establishing to
D. Something worth acquiring to
7) What kind of goods that may not exist in the real world?
A. Geffen goods
B. Cheap goods
C. Public goods
D. Private goods
8) What is the figure of the Gini coefficient in rich countries?
9) The term globalization is synonymous with ....
A. Income inequality
B. The spread of free markets
D. Capital markets
10) Gold is not used any more as the backing of major currencies after ....
A. The Great Depression
B. The Second World War
C. The failure of the Breton Woods Agreements in 1971
D. The end of the 20th century
11) The biggest role of the state of the economy is in ....
A. Free market economy
B. Command economy
C. Capitalistic economy
D. Dual System Regulated economy
12) In economic activity the importance of gold decline during the 20th century. It has just become another .....
A. Monetary asset
B. Store of value
D. Hedge against inflation
13) The role of state plays in economy is important. The maximum role will
be found in ....
A. the capitalist economy
B. the communist economy
C. the socialist economy
D. the free market economy
14) Which one of the list that works against free market economy?
15) Since 1980, politicians talking about the need to reduce the role of the state in economy. Since then, public spending has continued to ....
A. increase as a share of GDP
B. decrease as a share of GDP
C. to be stable as a share of GDP
D. to go up and down as a share of GDP
16) Alan Greenspan was central bank boss that was a pointed as the chairman of the board of governors of Federal Reserve Bank in 1987. He was reappointed in 2003 until 2005. He brought down inflation and created the conditions for strong economy growth. Before becoming an economist, Alan Greenspan was a ....... .
B. government employee
C. minister in cabinet
D. jazz musician
17) Higher growth in economy happens in the countries which have ....
A. Broadly free market policies
B. Central economic planning
C. High public spending
D. Political stability
18) People choose ..... .in their international transactions
A. Hard currencies
B. U.S. Dollar
C. Japanese Yen
D. German Mark
19) The main users of Hawala networks are ....
D. Overseas workers
20) Friedrich Hayek's views were inspired by ....
A. Adam Smith's invisible hand
B. Margaret Thatcher's views
C. Ronald Regan's views
D. Milton Friedman's ideas
21) Hedging is most often done by people to reduce the existing risk. One of the lists below is unlikely doing the hedging ....
A. commodity producers and traders
B. government agencies
C. financial institution
D. non-financial firms
22) One factor which is not directly influence your risk in investment is adverse change in the ....
A. exchange rate
B. foreign currency reserve
C. the interest rate
D. commodity price
23) One method to avoid the financial risks attached to holding shares in a firm is ....
A. selling all the shares
B. selling part of the shares
C. buying more the shares
D. diversification investment
24) If two producers of the same commodity merge and becoming one company we called it. ...
B. vertical integration
C. horizontal integration
D. monopolistic action
25) The money invested in currency market by speculators is often called ....
A. sleeping money
B. flying money
C. hot money
D. long term investment
26. How surprises often rise after. ...
A. property development
B. consumer's good inflation
C. interest rate reduction
D. foreign investment increase
27) Human capital cannot be increase by investing in ....
D. health care
28) Horizontal equity is a way to keep taxation ....
29) Unemployed workers make gradually lose the motivation, self confidence or self discipline needed to get to workplace and fulfil job requirements. This syndrome called ....
1) Income effect is a change in the demand caused by a change in ..... .
A. consumer taste
B. production capacity
C. income of consumers
D. government spending
2) Income tax is a much -loathed method of taxation based on .....
B. production of good and services
3) To keep pace with inflation, many countries automatically raised wages,
pensions, and some other sorts of income according to recent movements
in consumer price. This method known as ....
B. income adjustment
4) One of the lists below direct taxation ....
A. consumption tax
B. property tax
C. value added tax
D. income tax
5) Gini Coefficient is a measure of .... inequality
C. production capacity
D. human capital
6) Which one of this list includes in inferior goods?
A. Electronic goods
B. Luxury goods
7) Most economists reckon that. ... is best avoided.
8) Most of the central banks set an inflation target, except ....
A. New Zealand's Reserve Bank
B. France's Central Bank
C. Bank of England
D. America's Federal Reserve Bank
9) To keep the economy working smoothly, the information should not be ....
C. cheaply available
D. limit to state planners
1 0) The government provision of infrastructure is famous of its ....
A. bad planning and corruption
B. good quality and efficient
C. quick delivery and cheap
D. good service and fast deli very
11) According to Joseph Schumpeter innovation is ....... process
A. an endogenous
B. an exogenous
C. a creative destruction
D. a profit seeking
12) Although innovations push efficiency upward, the law protecting it creates inefficiency through .....
A. market mechanism
D. better quality product
13) Insider trading takes place when someone with privileged and confidential access to certain information before the news gets out. This practice was first banned by .....
D. Hong Kong
1) Studies of relationship between growth and GDP per head in rich and poor countries found no evidence that poorer countries grew faster. Why has not absolute convergence happened?
A. Bad countries in poorer countries
B. Good governance in richer countries
C. Good cooperation among richer countries
D. Other factors are not constant
2) A positive factor of an economic growth is ....
A. open economy
B. high public spending
C. high inflation
D. political instability
3) In the 1950s and 1950s much of the economics of the poor countries experienced corruption massive budget deficits rampant inflation caused by ....
A. high and inefficient bureaucracies
B. colonial policy during colonial era
C. independence war
D. open economy
4) Although the rates of income tax were cut during 1980s and 1990s the total amount collected via direct taxation continued to rise, because ....
A. people worked bander
B. company operated more efficiently
C. personal income and corporate profit grew steadily during that period
D. of decrease in unemployment
5) Firms used .... to judge whether an investment project is worth while.
B. positive net inflow
C. discounted cash flow
D. the benefits exceed the costs
6) A slower increase in price is called ....
C. low inflation
7) Disintermediation makes markets ....
C. more competitive
D. less competitive
8) Division of labour means .....
A. labour are free to organize
B. divide labour into several division
C. specializing while having a comparative advantages
D. divide labour into several organization
9) The government often used anti dumping policy to protect ....
C. labour force
1) What determines wages?
2) The greater the market flexibility ....
A. the lower rates of employment
B. the higher rates of unemployment
C. the higher GDP per head
D. the lower GDP per head
3) Laissez- Faire was supported by one of the following leaders ....
A. Margaret Tatcher
B. Francois Mitterand
C. Adam Smith
D. Helmut Schmidt
4) A land tax has obvious advantages because ...
A. it can improve the quality of the land
B. it can penalize the owners
C. it can increase the economic value of the land
D. it is simple and cheap to levy
5) What often makes more harm than good?
A. Property rights
B. Liberal economics
6) If things go wrong troubled banks will be ....
B. taken over
C. bailed out
7) What can government do to help promote liberal economics?
8) Economics are trying to help ...
9) Life - cycle hypothesis is an attempt to explain that people split their income between ....
A. their spending and loan, and the way that they save
B. their loan and saving, and the way that they spend
C. their saving and spending, and the way that they borrow
D. their loan and saving, and the way that they borrow
10) What is wholly liquid?
D. Traveller's cheque
11) Highly liquid markets attract more ...
B. liquidity - seeking traders
D. market makers
12) What has no place for liquidity traps?
A. Risk averse
B. Great depression
1) Changes in public spending and taxation are known as ...
A. fiscal policy
B. macroeconomic policy
C. monetary economic
D. economic policy
2) How big is the proportion of employment that is in the service in OECD countries?
A. One third
B. Two thirds
C. Four- fifths
D. Three - fifths
3) How much extra output a firm would get by employing an extra worker is called .....
A. the marginal revenue
B. the marginal product of labour
C. the marginal price
D. the marginal propensity
4) Market forces come from ...
D. market itself
5) Externalities can be reduced through ....
A. antitrust policy
B. Marshall Plan
D. tax system
6) Which of the following factor that allows market power to exist?
B. Perfect competition
7) What is the name of the institution through which the aid of the Marshall Plan was administered?
A. International Aid
B. Nation Building
C. New Marshall Plan
8) Who believed that a country's economic prosperity and political power came from its stocks of productive resources?
A. David Hume
C. John Law
9) Every time there is a shift in the balance of supply and demand, there will be ....
A. changing prices
B. sticky prices
C. low prices
D. high prices
10) Which of the following is mobile?
11) Microeconomics is the study of economic phenomenon such as ...
12) Controlling the money supply is called ...
A. monetary policy
B. monetary neutrality
C. modern portfolio theory
13) Who said that portfolio theory is net economics?
A. Adam Smith
B. Milton Friedmon
C. Harry Markowitz
D. David Hume
14) What does monetary change?
A. Interest rate
B. Exchange rate
C. Discount rate
D. Inflation rate
15) What misted people when there is money illusion?
16) What is it called in the UK that consists of cash, other financial institutions, and current account deposits?
17) Where does longer - term capital change hands?
A. Money market
B. Financial market
C. Capital market
D. Market capitalization
1) Who can help a country create a nation building?
A. World Bank
B. Other country
2) Where does nation building never functions?
A. Former Soviet Union
D. East Timor
3) What is the advantage of nationalization?
A. It has increased mixed economy
B. It lacks of competition
C. It has increased economic efficiency
D. It makes state-owned businesses enjoy a legally protected monopoly
4) The example of natural monopoly is in ....
A. oil distribution
B. water distribution
C. rice distribution
5) Markets for products with network effects are dominated by ....
A. a single firm
B. some firms
C. many firms
D. a few firms
6) Negative income tax is only for ....
A. the poor
B. the rich
C. the working poor
D. the working rich
1) What is the opposite of normative economics?
A. Negative economics
B. New economics
C. Positive economics
D. Old economics
2) Non-price competition is common when there is ....
D. free trade
3) The trade is growing fastest between ....
A. industrial countries with similar economies
B. industrial countries with different economies
C. agricultural countries with similar economies
D. agricultural countries with different economies
4) Nobel Prize for economics is dominated by economists from ....
D. The U.K.
1) Offshore is used to call ....
A. a firm locate on shore near a beach
B. a firm is an offshore oil Rig company
C. a firm is a foreign company
D. the usual rules of a person or firm's home country don't apply
2) Okun's law said that if GDP grows at around 3%, the jobless will be unchanged. If it grows faster, the unemployment rate will ....
A. fall by half of what the growth rate exceeds 3% by
B. stay the same
C. increase by half of what the growth rate exceeds 3% by
D. be the same
3) When a few firms dominate a market form a cartel we called it:
D. Free Market
4) An oil cartel will not be effective if ....
A. they dominate the crude oil market
B. they strict on their quota of production
C. they produce and sell oil as much as possible
D. they obey the commitment within cartel
5) An economy that allows unrestricted flow of people, capital, goods, and services, we call it ....
A. closed economy
B. open economy
C. free economy
D. open market
6) Central banks control the growth of money supply. They do it by ....
A. controlling of money printing
B. controlling interest rate directly
C. buying and selling securities in open markets
D. issuing securities
7) What is the optimal currency area?
A. A geographical area within which it would pay to have a single currency.
B. A geographical area within which it would pay many currencies.
C. A geographical area within which the money supply never grows.
D. A geographical area within which there is no central bank.
8) For the concept of optimum to mean anything there must be both:
A. a goal and the practitioner
B. a goal and a team to achieve it
C. a goal and a set of constraints
D. a goal and a goal keeper
1) Pareto efficiency is about a situation in which nobody can be made better without making somebody else ....
A. better off
B. changed for better or for worse
C. stay the same
D. worse off
2) Paris club is the name given to the arrangements through which countries reschedule their official debt. Its member is the 19 founders of the OECD as well as ....
3) Like any monopoly, patents create ....... .
D. new ideas
4) Insignificant events and choices can have huge consequences for the development of a market or an economy. This concept is known as ....
B. patent protection
C. path dependence
D. market is monopoly
5) The most competitive market imaginable is ....
D. Perfect competition
6) There is a trade off between unemployment and inflation. This theory was developed by ....
A. Milton Friedman
B. Adam Smith
C. Paul Samuelson
D. A.W.H Phillips
7) But on 1970s this relationship didn't work anymore. The economists prefer to talk about. ...
A. Non accelerate of inflation and low rate of unemployment (NAIRU)
B. Low rate of inflation and low rate of unemployment
C. Low rate of inflation and zero unemployment
D. High rate of inflation and high rate of unemployment
8) A fall in the price level increases the real value of people's savings making them feel wealthier and thus causing them to spend more. This increase in demand can lead to higher employment. This concept is known as ....
A. income hypothesis
B. phillips curve
C. pigau effect
D. path dependence
9) The Plaza Accord and Louvre accord were made among five big countries in 1985 and 1987 in order to stabilize ....
A. Deutsche Mark
B. Japanese Yen
C. British Pound sterling
D. US Dollar
10) There are 3 motives for holding money: Transactional motive, Precautionary motive, and Speculative motive. These motives identified by ....
A. Milton Friedman
B. John Keynes
C. Anthony Samuelson
D. A. W. H. Phillips
11) Some advocates of anti - dumping policies say that cheap imports are example of predatory pricing. This slogan is usually used by ....
B. local producers
12) Price is a point where supply meets demand in equilibrium. Under perfect competition all producers are price takers. Under a monopoly a seller has some control over the price. Usually the government acts as the only seller. This happened under ...... economy
A. a government controlled
B. free market
D. competitive market
13) In order to transform a state owned monopoly to be more efficient government does ....
A. privatisation and Deregulation
B. privatisation, and Liberalisation
C. deregulation and Liberalisation
D. privatisation, Deregulation, and Liberalisation
14) Improving fiscal position can be achieved by
A. raising taxes and cutting public spending
B. privatisation and raising taxes
C. privatisation, raising taxes, and cutting public spending
D. privatisation and cutting public spending
1) Take the fisher equation, MV = PT, where M is the stock of money, Vis the velocity of circulation, P is the average price level and T is the number of transactions in the economy. Fisher, Keynes and Friedman, all of them assume that. ...
A. M is constant
B. V is constant
C. P is constant
D. T is constant
2) Queuing usually reflects that demand exceeds supply because the price is set too low or deliberate rationing by the seller. This is a fairer way as is regarded by ...
3) Quota of import is a form of protectionism. This policy is made to protect ...
C. foreign producers
D. domestic producers
4) Random walk is about ........ .
A. people on the street
B. unpredictability of prices of many financial assets
C. the way the market behaves
D. the way of the stockbrokers walk on floor of NYSE
5) Rate of return is calculated by ..... .
C. profit after tax
D. expressing the profit as a percentage of capital used to produce it
6) Rationing is often used when the distribution decided by market forces IS ....
C. an open market
D. a black market
7) Recession is a period of slow or negative economic growth, usually accompanied by ....
C. increasing unemployment
D. decreasing unemployment
8) Regressive tax is regarded by economists goes against principle of ....
C. horizontal equity
D. vertical equity
9) Regulation is rules governing the activities of private sector enterprises and is usually introduced to tackle market failure, but regulation can also generate more costs than benefits. Which one of the following statements is incorrect?
A. Regulation creates compliance costs
B. Regulation may lock an industry into an inefficient equilibrium
C. Regulation may hold back innovation
D. Regulation makes a market more competitive
10) Regulatory is usually small in ....... market.
11) A top automobile executive was willing to lead a near bankrupt car
manufacturer for only one US Dollar per year when he was paid 1
million a year by a different company. What we call this difference of
999.999 USD per year?
C. economic rent
12) A union demanding higher wages to the management of a successful company without offering anything in return. What is the name of this union's move?
A. Compensation seeking
B. Equality seeking
C. Justice seeking
D. Rent seeking
13) A government should maintain its population steady. It means that it is ...
A. fertility rate = 0
B. infant mortality rate = 0
C. birth rate = 0
D. population growth= 0