basic of economics MCQs – Page 4

Practise focused basic of economics questions with marked answers for exam preparation and subject revision.

basic of economics Mcqs

61. Which of the following must always balance ?
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A. The balance of visible trade

B. The balance of invisible trade

C. The balance on the current account

D. The balance of payments

62. Total number of adults currently employed or actively seeking work in all economic sectors is known as ?
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A. All of them

B. Work force

C. Labor potential

D. Labor force

63. Which of the following is not a function of a commercial bank?
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A. Undertaking agency functions

B. Banker to the government

C. Accepting public deposits

D. Granting loan and advances

64. Mention an international trade policy competitive devaluation and increased protective barriers that one country institute to gain at the expense of its trading partners ?
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A. Protectionist policy

B. Beggar-thy-beighbour

C. Domestic policy

D. Nationalist policy

65. Devaluation of currency helps to promote ?
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A. Saving

B. Exports

C. Imports at lower cost

D. National income

66. Who is insolvent_______________?
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A. A firm that is for sale

B. A firm that has more liabilities than assets

C. A firm that is liquidated

D. A firm that is unable to pay debts

67. How is known the process in which an investment company continually offers new shares and buys existing shares back on demand and uses its capital to invest in diversified securities of other companies ?
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A. Stock holding company

B. Liquid fund

C. combine fund

D. Mutual fund

68. Unlike a black market, what is called a system of secretly selling or trading commodities which is not necessarily illegal ?
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A. Grey market

B. White market

C. Open market

D. Red market

69. Government of Pakistan issues currency on the basis of__________________?
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A. Availability of dollars in the country

B. Demand for money in the country

C. Tax collection

D. Availability of gold in the country

70. In Western Europe in 9th C, originated military and social system in which a nobleman would grant the use of land to servant in return for service which is often military, and duty, Name the system ?
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A. Rural system

B. Land based system

C. Feudal system

D. Military system

71. The comparative advantage comes if each trading partners has a product that will bring a better price in another country than it will at home. Which economist proposed the principle of comparative advantage ?
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A. Adam Ricardo

B. David Ricardo

C. David Smith

D. Adam Smith

72. The situation with increasing unemployment and inflation is terms as ?
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A. Reflection

B. Stagflation

C. Hyperinflation

D. Galloping

73. Which of the following is not an indirect tax ?
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A. Custom duty

B. Income tax

C. Tariff

D. Sales tax

74. Economic development is measured on the basis of ?
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A. Increase in nominal GNP

B. Increase in government revenue

C. Increase in personal income

D. Increase in real GNP

75. Scale for measuring the average share price and percentage change of 30 major US industrial companies is called ?
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A. Nikki Index

B. NASDAQ

C. Major Index

D. Dow Jones Index

76. Name the organization that is managed by those who use its facilities ?
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A. Corporation

B. Society

C. Cooperative

D. Limited Company

77. Where Nikkei Stock average applies ?
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A. Mainly to Japanese equities

B. Mainly to Korean equities

C. Mainly to international equities

D. Mainly to US equities

78. The branch banking system is in vogue in most countries of the world. In which country was it first developed?
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A. South Africa

B. Australia

C. UK

D. Canada

79. What is called a countrys total financial obligations to the rest of the world ?
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A. National liabilities

B. Total debt

C. External debt

D. Debt burden

80. Bank loans are usually altered to have longer maturities in order to assist the borrower in making the necessary repayments. What these loans are called____________?
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A. Rearranged loans

B. None of these

C. Altered loans

D. Rescheduled loans

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