Economics MCQs

Page No. 209

Under a system of floating exchange rates the pound would depreciate in value if there occurs ?


a Price inflation in the United States


ban increase in U.S real income


ca decrease in the British money supply


d falling interest rates in Britain



Suppose that a Swiss television set that costs 400 francs in Switzerland cost $200 in the United States. The exchange rate between the franc and the dollar is ?


a2 francs per dollar


b 1 franc per dollar


c$2 per franc


d $3 per franc


View Answer 2 francs per dollar

1. The most widely traded currency in the foreign exchange market is the ?


aeuro


bChinese Yuan


cBritish pound


dU.S dollar


View Answer U.S dollar

G. MecDougall showed in his tests that ?


arelatively higher U.S labor productivity was associated with relatively higher U.K export ratios


brelatively high U.K labor productivity was associated with relatively higher U.K export ratios


cLabor productivity ratios and export ratios were not associated with each other


dNone of the above



Dynamic gains from trade could result from ?


aThe stimulus of additional investment spending as market open


bEconomies of large scale production as markets open


cAdditional competition made possible by the opening of markets


d All of the above


View Answer All of the above

Under free trade, Canada would not realize any gains from trade with Sweden if Canada ?


aTrades at Canada’s marginal rate of transformation


b Trade at Sweden’s marginal rate of transformation


cSpecializes completely in the production of its export good


dSpecializes partially in the production of its exports goods



In autarky, when a community maximizes its standard of living its production point is ?


abelow the production possibility frontier


bon the production possibility frontier


cabove the production possibility frontier


d can’t tell without more information



In aukarky, when a community maximizes its standard of living, its production and consumption point is ?


a below the production possibility frontier


bOn the production possibility frontier


cabove the production possibility frontier


dcan’t tell without more information



Which countries terms of trade improved between 1990 and 2000 ?


aMexico and Denmark


bSweden and Denmark


cSweden and Spain


d Mexico and Sweden


View Answer Mexico and Sweden

In autarky the relative price of wine, in terms of beer, in Country B is ?


a1W = 3B


b1W = 4 1/2B


c1W = 5B


d1W = 6B


View Answer 1W = 4 1/2B

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