Economics/Economics Balance of Payments Sample Test,Sample questions

Question:
  Flexible exchange rate system has the advantage:

1.Automatic adjustment of balance of payments

2. Easy to borrow from world bank

3.Encourages exports

4.None of the above


Question:
  If balance of payments of country is in deficit, then:

1.Current account will be in deficit

2.Country can increase money supply to meet deficit

3. The country can borrow from abroad

4.(a) and (c) of above


Question:
  IMF has given loan to Pakistan. It will improve Pakistan s:
 

1.Current account

2.Capital account

3.Overall balance of payments

4.(b) and (c) of above


Question:
  IMF represents

1.International Monetary Fund

2.International Money Flow

3.International Money Forum

4.International Monetary Finance


Question:
  In a country like Pakistan:

1.All economic decisions are made through markets

2.There is no planning

3.Govt. owns most of the means of production

4.There is reliance on market


Question:
  In capitalism there is sovereignty of:

1.Producer

2.Consumer

3.Government

4.Businessmen


Question:
  The balance of payments of country means

1. Balance in income and expenditure of govt.

2.Balance in demand and supply of money

3. Balance in export and import earnings

4.The annual account of foreign trade


Question:
  Which of the following compares the average price of exports to average price of imports?

1. The balance of payments

2.The balance of trade

3.The exchange rate

4.The terms of trade


Question:
  Which of the following must always balance?

1.Balance of visible trade

2.Balance of invisible trade

3.Balance on the current balance

4.Balance of payments


Question:
 Balance of payments of a country has parts:

1.2

2.3

3.4

4.5


Question:
 Exchange rate for currencies is determined by supply and demand in system of:

1.Fixed exchange rate

2.Flexible

3.Constant

4.Govt. regulated


Question:
 Export of goods is called trade in:

1.Visible goods

2. Invisible goods

3.Basic goods

4.Non-real goods


Question:
 Final balance of payments of a country is:

1.Always balanced

2.Always deficit

3.Always surplus

4.Fluctuates


Question:
 Fixed exchange rate system has the advantage:

1.Automatic adjustment of balance of payments

2.Increases govt. control over foreign trade

3.Discourages unnecessary speculation about future trade deals

4.(b) and (c) of above


Question:
 If CDA (Capital Development Authority  Islamabad) gets a loan from World Bank for roads  it will be recorded in the balance of payments in section:

1.Capital account

2.Visible balance

3.Invisible balance

4.Official financing


Question:
 If Japanese import more goods from Pakistan (other things remain same)

1.Our balance of payments will improve

2.Japan s BOP will deteriorate

3.Our BOP will deteriorate

4. (a) and (b) of above


Question:
 If Toyota Company  establishes a factory in Pakistan  this will be recroded in balance of payments in the section:

1.Capital account

2.Visible balance

3.Invisible balance

4.Official financing


Question:
 IMF gives loans:

1.To fill gap in balance of payments

2.To fill gap in government budget

3.To decrease inflation

4. To increse employment opportunities


Question:
 In socialistic system, prices of goods are determined by:

1.Sellers

2.Buyers

3.Government

4. Forces of demand and supply


Question:
 In working of markets, the Islamic system is nearer to:

1.Capitalism

2.Socialism

3.Mixed economy

4.None of the above


Question:
 Invisible items in balance of payments include:

1.Foreign remittances

2.Income from tourists

3.Internet charges

4.All the three


Question:
 It helps countries to meet deficit in balance of payments:

1.IMF

2.WTO

3.World Bank

4.UNO


Question:
 What will be expected result if the value of rupee falls against dollar?

1.The price of Pakistani goods in USA will rise

2.The price of American goods in USA will fall

3.The price of American goods in USA with fall

4.The price of American goods in Pakistan will rise


Question:
 Which of the following must always balance:

1.Balance of visible trade

2.Balance of invisible trade

3.Balance on the current account

4.Balance of payments


Question:
A country that does not trade with other countries is called an economy:

1.Open

2.Closed

3.Independent

4.None of these


Question:
Balance of payments of a country includes:

1.Current account

2.Moentary account

3.Capital account

4.All of above


Question:
Balance of payments of a country includes:

1.Balance of trade

2.Capital receipts and payments

3.Saving and investment account

4. Both (a) and (b)


Question:
Basic principle of Islamic economic system is:

1.Equality

2.Justice

3.High profit

4.Less consumption


Question:
Capitalism is defined as an economic system where there is:

1.A lack of planning

2.A reliance over free market

3.Private ownership of property

4. All of the above


Question:
Export of goods is called trade in:

1.Visible goods

2. Invisible goods

3.Basic goods

4.Real goods


Question:
Foreign exchange reserves increase if:

1.Govt. increases taxes

2.Exports increase imports remain the same

3.Imports increase exports remain the same

4.(a) and (b) of above


Question:
If GNP of Pakistan rises  it will encourage:

1.Exports

2.Imports

3.Both

4.None of these


Question:
In capitalistic system, prices of goods are determined by:

1.Sellers

2.Buyers

3.Government

4. Forces of demand and supply


Question:
In Islamic economic system:

1.All economic decisions are made through markets

2.There is no planning

3.Govt. owns most of the means of production

4.There is reliance on market


Question:
Pakistan follows the policy of:

1.Fixed exchange rate

2.Flexible exchange rate

3.Controlled exchange rate

4.Increasing exchange rate


Question:
Pakistan having a:

1.Mixed economy

2.Capitalistic economy

3.Socialistic economy

4.Islamic economy


Question:
Pakistan s exports are part of our GDP:

1.5%

2.15%

3.25%

4.35%


Question:
The balance of payments account of a country includes:

1.Official transfer of foreign exchange

2.Smuggling transactions

3. Loans and aid

4.Both a and c of the above


Question:
The receipts and payments for goods exported and imported are counted in:

1.Trade account

2.Capital account

3.Current account

4.Monetary account


Question:
Visible goods are recorded in this part of balance of payments account:

1.Current account

2.Capital account

3. Govt. account

4.Official account


Question:
Visible goods are recorded in this part of balance of payments account:

1.Current account

2.Capital account

3. Govt. account

4.Official account


Question:
Visible imports include:

1.Remittance

2.Machinery

3.Computer software

4.Transport cost


Question:
What would cause a country s exchange rate to fall:

1.An increased demand for its exports

2.An increased demand for its imports

3.An increased in flow of capital

4.None of the above


Question:
Which is the basic economic problem, which is common in all economic systems:

1.Allocation of scarce resources

2.Elimination of inflation

3.To increase exports

4.To reduce taxation


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