Shared by Tariq Mahmood<tariq6382@gmail.com>
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Gross National Product equals:
a) Net National Product adjusted for inflation
b) Gross Domestic Product adjusted for inflation
c) Gross Domestic Product plus net property income from abroad
d) Net National Product plus net property income from abroad
Net National Product equals:
a) Gross National Product adjusted for inflation
b) Gross Domestic Product adjusted for inflation
c) Gross Domestic Product plus net property income from abroad
d) Gross National Product minus depreciation
The standard of living is often measured by:
a) Real GDP per capita
b) Real GDP
c) Real GDP * population
d) Real GDP plus depreciation
In a recession:
a) Unemployment is likely to be low
b) Prices are likely to increase
c) Growth is negative
d) Growth is slow
In a boom:
a) Surpluses are likely to occur
b) Prices are likely to fall
c) Supply will increase immediately to match demand
d) Shortages may occur
GDP plus net property income from abroad equals what?
a) GNP
b) NNP
c) Depreciation
d) Real GDP
To adjust GDP from market prices to factor cost:
a) Add indirect taxes
b) Subtract subsidies
c) Deduct indirect taxes and subsidies
d) Deduct indirect taxes and add subsidies
To adjust from Gross National Product to Net National Product:
a) Deduct depreciation
b) Deduct indirect taxes
c) Deduct subsidies
d) Add inflation
In a recession a government:
a) Is likely to want to increase demand in the economy
b) Is likely to want to decrease demand in the economy
c) Is likely to want to stabilise demand in the economy
d) Is likely to want to increase supply in the economy
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A higher GDP per capita may not mean that the quality of life has really improved because:
a) It measures wealth not income
b) It measures Gross Domestic Product
c) It does not measure the quality of the items produced
d) It is only measured every five years
Unit 22
Question 1
Economic growth can be measured by:
a) The CPI
b) The CBI
c) GDP
d) MPC
Question 2
In a boom:
a) Unemployment is likely to fall
b) Prices are likely to fall
c) Demand is likely to fall
d) Imports are likely to grow
Question 3
In a recession, GDP:
a) Grows negatively
b) Grows slowly
c) Grows by 0%
d) Grows rapidly
Question 4
If labour productivity per week is 200 units and there are 5 employees what is the total output?
a) 40 units
b) 195 units
c) 1000 units
d) 200 units
Question 5
Labour productivity measures:
a) The output per worker
b) The output per machine
c) Total output
d) Marginal output
Question 6
Potential growth measures:
a) The growth of the fastest economy in the world
b) The fastest growth an economy has ever achieved
c) The present rate of growth of an economy
d) The rate of growth that could be achieved if resources were fully employed
Question 7
Economic growth can be seen by an outward shift of:
a) The Production Possibility Frontier
b) The Gross Domestic Barrier
c) The Marginal Consumption Frontier
d) The Minimum Efficient Scale
Question 8
The socially optimal rate of growth is:
a) Zero
b) Negative
c) Where the marginal social benefit = the marginal social cost
d) Total social costs are minimised
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Question 9
To anticipate what the economy is going to do next the government will look at:
a) Lagging indicators
b) Flashing indicators
c) Coincidental indicators
d) Leading indicators
Question 10
When an economy first begins to grow more slowly:
a) GDP increases
b) Inflation is likely to increase
c) Stock levels are likely to increase
d) Investment in equipment is likely to increase
Unit 23
Question 1
A shift in aggregate supply is likely to:
a) Reduce the general price level and reduce national income
b) Reduce the general price level and increase national income
c) Increase the general price level and reduce national income
d) Increase the general price level and increase national income
Question 2
Aggregate demand will increase if:
a) Consumption falls
b) Investment falls
c) Exports fall
d) Imports fall
Question 3
An increase in aggregate demand will have most effect on prices if:
a) Aggregate supply is price inelastic
b) Aggregate supply is price elastic
c) Aggregate supply has a unitary price elasticity
d) Aggregate demand is price inelastic
Question 4
Which of the following would increase aggregate demand?
a) Increased saving
b) Increasing import spending
c) Increased taxation revenue
d) Increased investment
Question 5
Which of the following would decrease aggregate demand?
a) Increased consumption
b) Increasing export revenue
c) Increased taxation revenue
d) Increased investment
Question 6
Improved training of employees would:
a) Shift aggregate supply to the right
b) Shift aggregate supply to the left
c) Shift aggregate demand to the right
d) Shift aggregate demand to the left
Question 7
Increased unemployment benefits and less incentive to work would:
a) Shift aggregate supply to the right
b) Shift aggregate supply to the left
c) Shift aggregate demand to the right
d) Shift aggregate demand to the left
Question 8
Increased levels of consumption:
a) Shift aggregate supply to the right
b) Shift aggregate supply to the left
c) Shift aggregate demand to the right
d) Shift aggregate demand to the left
Question 9
Increased levels of spending on imports:
a) Shift aggregate supply to the right
b) Shift aggregate supply to the left
c) Shift aggregate demand to the right
d) Shift aggregate demand to the left
Question 10
An increase in aggregate demand if aggregate supply is totally inelastic will:
a) Increase price but not output
b) Increase output but not price
c) Increase output and price
d) Decrease output and price
Unit 24
Question 1
If the marginal propensity to consume on domestic products is 0.9 the size of the multiplier is:
a) 10
b) 1
c) 9
d) 0.1
The multiplier is (1/1-mpc) so if the mpc is 0.1 the multiplier is 10.
Question 2
An increase in the marginal propensity to consume will:
a) Increase the size of the multiplier
b) Increase the marginal propensity to save
c) Decrease national income
d) Reduce injections into the economy
Question 3
If the Keynesian consumption function is C = 10 + 0.8 Yd then when disposable income is £1000, total consumption is what?
a) 0.8
b) 800
c) 810
d) 0.81
If the Keynesian consumption function is C = 10 + 0.8 Yd then when disposable income is £1000, total consumption = 10 + 0.8(1000) = 810
Question 4
If the Keynesian consumption function is C = 10 + 0.8 Yd then when disposable income is £1000, the marginal propensity to consume is what?
a) 0.8
b) 800
c) 810
d) 0.81
If the Keynesian consumption function is C = 10 + 0.8 Yd then when disposable income is £1000, the marginal propensity to consumer is 0.8.
Question 5
If the Keynesian consumption function is C = 10 + 0.8 Yd then when disposable income is £1000, the average propensity to consume is what?
a) 0.8
b) 800
c) 810
d) 0.81
If the Keynesian consumption function is C = 10 + 0.8 Yd then when disposable income is £1000, the average propensity to consume = 810/1000=0.81
Question 6
As income increases:
a) The average propensity to consume gets nearer in value to the marginal propensity to consume
b) The average propensity to consume diverges in value from the marginal propensity to consume
c) The average propensity to consume falls
d) The average propensity to consume always approaches 0
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Question 7
An increase in consumption at any given level of income is likely to lead to:
a) A fall in savings
b) An increase in exports
c) A fall in taxation revenue
d) A decrease in import spending
Question 8
Lower interest rates are likely to:
a) Decrease consumption
b) Increase cost of borrowing
c) Encourage saving
d) Increase spending
Question 9
Friedman's theory of consumption focuses on:
a) Past income
b) Current income
c) Disposable income
d) Permanent income
Question 10
The marginal propensity to consume is equal to:
a) Total spending / total consumption
b) Total consumption / total income
c) Change in consumption / change in income
d) Change in consumption / change in savings
Unit 25
Question 1
An increase in investment is most likely to be caused by:
a) Lower interest rates
b) Lower national income
c) A decrease in the marginal propensity to consume
d) An increase in withdrawals
Question 2
An outward shift in the Marginal Efficiency of Capital should:
a) Decrease consumption
b) Increase aggregate demand
c) Reduce aggregate supply
d) Slow economic growth
Question 3
An increase in interest rates:
a) Is likely to reduce savings
b) Is likely to reduce the external value of the currency
c) Leads to a shift in the MEC schedule
d) Leads to a movement along the MEC schedule
Question 4
The accelerator assumes:
a) The marginal propensity to consume is constant
b) The economy is at full employment
c) There is a constant relationship between net investment and the rate of change of output
d) The multiplier is constant
Question 5
Investment depends mainly on:
a) Past levels of income
b) Future expected profits
c) Present national income levels
d) Historic data
Question 6
A profit maximising firm will invest up to the level of investment where:
a) The cost of borrowing equals the marginal efficiency of capital
b) The cost of borrowing is greater than the marginal efficiency of capital
c) The cost of borrowing is less than the marginal efficiency of capital
d) The cost of borrowing equals the marginal propensity to consume
Question 7
Investment is:
a) An injection that increases aggregate demand
b) A withdrawal that increases aggregate demand
c) An injection that decreases aggregate demand
d) A withdrawal that decreases aggregate demand
Question 8
Investment is an unstable element of aggregate demand because is depends heavily on:
a) Government policy
b) Expectations
c) National income
d) Historic trends
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Question 9
If an increase in investment leads to a bigger increase in national income this is called the:
a) Accelerator
b) Aggregate demand
c) Monetarism
d) Multiplier
Question 10
The difference between gross investment and net investment is:
a) Depreciation
b) Acceleration
c) Deceleration
d) Capital investment
Unit 26
Question 1
An expansionist fiscal policy could include:
a) Lower interest rates
b) Increased lending by the banks
c) An increase in corporation tax
d) An increase in discretionary government spending
Question 2
If the economy grows the government's budget position will automatically:
a) Worsen
b) Improve
c) Stay the same
d) Increase with inflation
Question 3
Fiscal drag occurs when:
a) Tax bands do not increase with inflation
b) Tax rates move inversely with inflation
c) Government spending falls to reduce aggregate demand
d) Tax bands increase with inflation
Question 4
If the marginal rate of tax is 40% and consumers' income increase from £10,000 to £12,000:
a) The amount of tax paid will increase by £4,800
b) The amount of tax paid will increase by £4,000
c) The amount of tax paid will increase by £800
d) The total tax paid will be £4,800
The extra tax paid is £800 (= 40%*£2000).
Question 5
Imagine there is no tax on income up to £10000; after that, there is a tax of 50%. What is the average tax rate on an income of £20000?
a) £5000
b) 20%
c) 25%
d) £10,000
The total tax paid is £5000; this means that the average tax is 25% (£5000 out of £20,000).
Question 6
The marginal rate of tax paid is:
a) The total tax paid / total income
b) Total income / total tax paid
c) Change in the tax paid / change in income
d) Change in income / change in tax paid
Question 7
In a regressive tax system:
a) The amount of tax paid increases with income
b) The marginal rate of tax decreases with more income
c) The average rate of tax falls as income increases
d) The average rate of tax is constant as income increases
Question 8
The Public Sector Net Cash Requirement (PSNCR) is:
a) A measure of the country's trade position
b) A measure of the country's budget position
c) A measure of the country's total debt
d) A measure of the government's monetary stance
Question 9
A government might use tax to:
a) Discourage consumption of positive externalities
b) Discourage consumption of public goods
c) Discourage consumption of merit goods
d) Discourage consumption of negative externalities
Question 10
As an economy grows:
a) The government's budget position should automatically improve
b) The government's budget position should automatically worsen
c) This will have no effect on the government's budget position
d) This will reduce the government's tax revenue
Unit 27
Question 1
If people are made unemployed because of a fall in aggregate demand this is known as:
a) Frictional unemployment
b) Seasonal unemployment
c) Cyclical unemployment
d) Structural unemployment
Question 2
Supply side policies are most appropriate to cure:
a) Involuntary unemployment
b) Cyclical unemployment
c) Voluntary unemployment
d) A fall in aggregate demand
Question 3
The natural rate of unemployment is likely to fall if:
a) Unemployment benefits increase
b) Income tax increases
c) More training is available for the unemployed
d) Geographical immobility increases
Question 4
If the real wage is too high in the labour market:
a) The quantity demanded of labour is higher than the quantity supplied
b) The quantity demanded of labour equals the quantity supplied
c) The quantity demanded of labour is lower than the quantity supplied
d) It will automatically adjust in the short run to bring about equilibrium
Question 5
If there is cyclical unemployment in the economy the government might:
a) Increase interest rates
b) Encourage savings
c) Cut taxes
d) Reduce government spending
Question 6
Occupational immobility of labour occurs if:
a) People lack information
b) People do not want to work
c) People do not have the right skills to work
d) People cannot afford to move location
Question 7
Which of the following is not a supply side measure?
a) Increased training
b) Providing more information
c) Helping individuals to move location to find work
d) Increasing spending on existing industries
Question 8
Reducing involuntary unemployment:
a) Helps the economy move on to the Production Possibility Frontier
b) Helps shift the economy's Production Possibility Frontier outwards
c) Helps the economy move along its Production Possibility Frontier
d) Helps the economy move inside the Production Possibility Frontier
Question 9
Less demand in the economy may increase unemployment; this may lead to less spending which may reduce demand further. This is called:
a) The upward accelerator
b) The downward multiplier
c) The upward PPF
d) The downward mpc
Question 10
To reduce cyclical unemployment the government might:
a) Increase the budget surplus
b) Increase the balance of payments deficit
c) Reduce interest rates
d) Reduce government expenditure
Unit 28
Question 1
The precautionary demand for money is:
a) An idle balance
b) An active balance
c) Directly related to interest rates
d) Inversely related to income
Question 2
The liquidity trap occurs when the demand for money:
a) Is perfectly interest elastic
b) Is perfectly interest inelastic
c) Means that an increase in money supply leads to a fall in the interest rate
d) Means that an increase in the money supply leads to an increase in the interest rate
Question 3
A fall in interest rates is likely to:
a) Increase aggregate demand
b) Increase savings
) Decrease consumption
d) Decrease exports
Question 4
According to the quantity theory of money an increase in the money supply is most likely to lead to inflation if:
a) The velocity of circulation decreases
b) The number of transactions decreases
c) There is deflation
d) The velocity of circulation and the number of transactions is constant
Question 5
A reduction in the money supply is likely to:
a) Reduce the interest rate
b) Increase the interest rate
c) Increase inflation
d) Decrease deflation
Question 6
To reduce the supply of money the government could:
a) Reduce interest rates
b) Buy back government bonds
c) Sell government bonds
d) Encourage banks to lend
Question 7
The speculative demand for money occurs when:
a) Individuals hold money just in case an emergency happens
b) Individuals hold money to buy things
c) Individuals hold money rather than other assets because they are worried about the price of the other assets falling
d) Individuals hold money to shop
Question 8
An outward shift in the demand for money, other things being equal should lead to:
a) A lower interest rate but the same quantity of money
b) A higher interest rate but the same quantity of money
c) A higher quantity of money but lower interest rates
d) A higher quantity of money but the same interest rate
Question 9
The interest rate in the UK is determined by:
a) The government
b) The electorate
c) The Monetary Policy Committee
d) The Federal Reserve Board
Question 10
Open Market Operations occur when the government:
a) Reduces the interest rate
b) Buys and sells bonds and securities
c) Increases taxation
d) Increases the exchange rate
Unit 29
Question 1
Demand pull inflation may be caused by:
a) An increase in costs
b) A reduction in interest rate
c) A reduction in government spending
d) An outward shift in aggregate supply
Question 2
Inflation:
a) Reduces the cost of living
b) Reduces the standard of living
c) Reduces the price of products
d) Reduces the purchasing power of a pound
Question 3
An increase in injections into the economy may lead to:
a) An outward shift of aggregate demand and demand pull inflation
b) An outward shift of aggregate demand and cost push inflation
c) An outward shift of aggregate supply and demand pull inflation
d) An outward shift of aggregate supply and cost push inflation
Question 4
An increase in aggregate demand is more likely to lead to demand pull inflation if:
a) Aggregate supply is perfectly elastic
b) Aggregate supply is perfectly inelastic
c) Aggregate supply is unit elastic
d) Aggregate supply is relatively elastic
Question 5
An increase in costs will:
a) Shift aggregate demand
b) Shift aggregate supply
c) Reduce the natural rate of unemployment
d) Increase the productivity of employees
Question 6
The effects of inflation on the price competitiveness of a country's products may be offset by:
a) An appreciation of the currency
b) A revaluation of the currency
c) A depreciation of the currency
d) Lower inflation abroad
Question 7
Menu costs in relation to inflation refer to:
a) Costs of finding better rates of return
b) Costs of altering price lists
c) Costs of money increasing its value
d) Costs of revaluing the currency
Question 8
In the short run unemployment may fall below the natural rate of unemployment if:
a) Nominal wages have risen less than inflation
b) Nominal wages have risen at the same rate as inflation
c) Nominal wages have risen more than inflation
d) Nominal wages have risen less than unemployment
Question 9
According to the Phillips curve unemployment will return to the natural rate when:
a) Nominal wages are equal to expected wages
b) Real wages are back at equilibrium level
c) Nominal wages are growing faster than inflation
d) Inflation is higher than the growth of nominal wages
Question 10
The Phillips curve shows the relationship between inflation and what?
a) The balance of trade
b) The rate of growth in an economy
c) The rate of price increases
d) Unemployment
Unit 30
Question 1
If the value of the pound in other currencies is strong:
a) The price of UK products abroad in foreign currency will fall
b) The price of UK products abroad in foreign currency will rise
c) The price of UK products in the UK will rise
d) The price of UK products in the UK will fall
Question 2
If the value of the pound in other currencies rises:
a) The spending on UK exports in pounds must rise
b) The spending on UK exports in foreign currency will rise if demand is price elastic
c) The demand for UK exports will rise
d) The spending on UK exports in foreign currency will fall if demand for UK exports is price elastic
Question 3
The supply of pounds to the currency market will be upward sloping if:
a) The demand for UK exports is price elastic
b) The demand for UK exports is price inelastic
c) The demand for imports into the UK is price elastic
d) The demand for imports into the UK is price inelastic
Question 4
A fall in the value of the pound is likely to decrease spending on imports if:
a) The price elasticity of demand for imports is price elastic
b) The price elasticity of demand for imports is price inelastic
c) The price elasticity of demand for imports has a unit price elasticity
d) The price elasticity of demand for exports is price elastic
Question 5
If the exchange rate is above the equilibrium level:
a) There is excess demand and the exchange rate will fall
b) There is excess supply and the exchange rate will fall
c) There is excess demand and the exchange rate will rise
d) There is excess supply and the exchange rate will rise
Question 6
If the exchange rate is below the equilibrium level:
a) There is excess demand and the exchange rate will fall
b) There is excess supply and the exchange rate will fall
c) There is excess demand and the exchange rate will rise
d) There is excess supply and the exchange rate will rise
Question 7
To prevent the exchange rate rising the government could:
a) Sell its own currency
b) Increase interest rates
c) Buy its own currency
d) Sell foreign currency
Question 8
A depreciation of a currency occurs when:
a) The value of the currency falls
b) The value of the currency increases
c) Inflation falls
d) The balance of payments improves
Question 9
An appreciation of the currency may occur if:
a) Domestic interest rates fall
b) There is an increase in demand for imports
c) There is an increase in demand for exports
d) There is an increase in the balance of payments deficit
Question 10
A fall in the external value of a currency:
a) May cause an outward shift in the demand for the currency
b) May cause an inward shift in the supply for the currency
c) May lead to a movement along the demand curve for a currency
d) May be due to a increase in demand for the country's exports
Unit 31
Question 1
Which of the following is not an argument for protectionism?
a) To protect infant industries
b) To increase the level of imports
c) To protect strategic industries
d) To improve the balance of payments
Question 2
A demand switching policy could be
a) Higher interest rates
b) Higher income tax
c) Tariffs
d) Reduced government spending
Question 3
Free trade is based on the principle of:
a) Comparative advantage
b) Comparative scale
c) Economies of advantage
d) Production possibility advantage
Question 4
If a country can produce 10 of product A or 4 of product B the opportunity cost of 1B is:
a) 0.4A
b) 2.5A
c) 10A
d) 1B
If a country can produce 10 of product A or 4 of product B the opportunity cost of 1B is 2.5A.
Question 5
Tariffs:
a) Decrease the domestic price of a product
b) Increase government earnings from tax
c) Increase the quantity of imports
d) Decrease domestic production
Question 6
The terms of trade measure:
a) The income of one country compared to another
b) The GDP of one country compared to another
c) The quantity of exports of one country compared to another
d) Export prices compared to import prices
Question 7
In a floating exchange rate system:
a) The government intervenes to influence the exchange rate
b) The exchange rate should adjust to equate the supply and demand of the currency
c) The Balance of Payments should always be in surplus
d) The Balance of payments will always equal the government budget
Question 8
The marginal propensity to consume is equal to:
a) Total spending / total consumption
b) Total consumption / total income
c) Change in consumption / change in income
d) Change in consumption / change in savings
Question 9
If there is a balance of payments deficit then in a floating exchange rate system:
a) The external value of the currency would tend to fall
b) The external value of the currency would tend to rise
c) The injections from trade are greater than the withdrawals
d) Aggregate demand is increasing
Question 10
To prevent the external value of the currency from falling the government might:
a) Reduce interest rates
b) Sell its own currency
c) Buy its own currency with foreign reserves
d) Increase its own spending
Unit 32
Question 1
Members of the European Union:
a) Have the same interest rates
b) Have one set of laws
c) All have the euro currency
d) Have common tariffs against non members
Question 2
Which of the following is not a member of the European Union?
a) France
b) Russia
c) Bulgaria
d) Poland
Question 3
The population of the European Union is approximately what?
a) 50 million
b) 450 million
c) 1000 million
d) 2000 million
Question 4
Within the European Union:
a) There are no tariffs between member countries
b) All member countries have the euro currency
c) All member countries have the same taxation policies
d) All member countries have the same defence policy
Question 5
Belonging to the European Union:
a) Encourages trade with non member countries
b) Encourages trade with member countries
c) Encourages protectionism within the union
d) Encourages countries to act independently
Question 6
The UK:
a) May join the European Union in the future
b) Relies on the European Union for all of its trade
c) Relies on the European Union for much of its tax revenue
d) Joined the European Union in 1973
Question 7
The CAP is:
a) The Common Agricultural Policy
b) The Common Alien Policy
c) The Community Agricultural Premium
d) The Cost And Price agreement
Question 8
By having a bigger target market within the European Union a firm might benefit from economies of scale. Which of the following is not an economy of scale?
a) Purchasing
b) Financial
c) Managerial
d) Allocative efficiency
Question 9
Which of the following is not a European institution?
a) European Parliament
b) European Commission
c) European Congress
d) European Council
Question 10
Which of the following could be a problem of being a member of the European Union?
a) Greater competition
b) More customers
c) Easier access to markets
d) Greater uniformity in markets
Unit 33
Question 1
Which of the following is not a way of helping developing economies?
a) Aid
b) Loans
c) Protectionism of developed markets
d) Training and education programmes
Question 2
Developing economies usually have:
a) Low GDP per capita
b) Low CPI
c) Large balance of payments surpluses
d) Large budget surpluses
Question 3
Demand for primary products is likely to be:
a) Very sensitive to price
b) Price elastic
c) Unit elastic
d) Income inelastic
Question 4
Developing economies usually:
a) Have large industrialised sectors
b) Are dependent on primary products
c) Have high levels of wealth
d) Earn more from exports than is spent on imports
Question 5
Earning from primary products are often unstable because:
a) Demand is price elastic
b) Supply is price elastic
c) Supply conditions are relatively stable
d) Supply conditions are unstable
Question 6
Over time the price of primary products tends to fall because:
a) Demand is income elastic
b) Supply is income elastic
c) Of outward shifts in supply
d) Demand is price elastic
Question 7
Less Developed Countries tend to have:
a) A high average age
b) A slow population growth rate
c) High life expectancy
d) A low literacy rate
Question 8
In a Less Developed Country:
a) The infrastructure is likely to be good
b) Real wages are likely to be high
c) Unemployment is likely to be low
d) The primary sector is likely to be significant
Question 9
An injection of funds into a Less Developed Country might set off the:
a) Multipler
b) Marginal propensity to save
c) Average propensity to consume
d) The Laffer effect
Question 10
The marginal propensity to consume in a Less Developed Country is likely to be:
a) Less than 0
b) Nearly 0
c) High
d) Low
Unit 34
Question 1
Which of the following is not a global organisation?
a) IMF
b) World Bank
c) Competition Commission
d) WTO
Question 2
Globalisation is likely to increase with:
a) More protectionism
b) An increase in tariffs
c) More trade within countries
d) Greater trade flows between countries
Question 3
A multinational business:
a) Sells products abroad
b) Produces in more than one country
c) Imports from abroad
d) Sells only domestically
Question 4
Which of the following best describes the selling of a production licence to another firm?
a) Hands over all rights to its products
b) Sells its products abroad
c) Sells the right to produce to another business
d) Sells the business to another business
Question 5
Globalisation is made more difficult by:
a) The actions of the World Trade Organisation
b) The removal of protectionist measures
c) Exchange rate instability
d) More free trade agreements
Question 6
Finding a partner to work with abroad is called a:
a) Takeover
b) Merger
c) Acquisition
d) Joint venture
Question 7
Some pressure groups oppose globalisation. The best economic reason for opposition would be:
a) World trade may increase
b) The marginal social benefits of globalisation are less than the marginal social costs
c) Global standards of living may rise
d) World income inequality may increase
Question 8
The UK would not have attracted inward investment because:
a) It is within the European Union
b) English is a common world wide language
c) It has a stable economic system
d) A strong pound may have made it cheaper for foreign buyers to purchase UK companies
Question 9
Why might a country resist globalisation?
a) Greater choice of final products
b) Greater choice of supplies
c) Greater competition for domestic firms
d) More markets to sell to
Question 10
World trade has been increasing due to:
a) Increased tariffs
b) Increased legal barriers
c) Increased embargoes
d) Reduced protectionism
