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Question 1:

A 'Balance of Payments' surplus occurs when:

The total of a country's credits in its balance of payments exceeds its debits The total of a country's debits exceeds its credits There is no trade between countries A country's imports exceed its exports

Question 2:

In the context of market structures, 'Perfect Competition' is characterized by:

Sellers producing differentiated products A large number of buyers and sellers with no control over the market price A few sellers with significant control over price A single seller dominating the market

Question 3:

Which of the following factors is likely to cause a rightward shift in the demand curve for a normal good?

An increase in consumer income A decrease in the price of the good An increase in the price of a substitute good A decrease in consumer income

Question 4:

A key characteristic of a 'Monopoly' is:

Perfect information Many sellers competing in the market No control over prices Barriers to entry that prevent competition

Question 5:

Internal economies of scale are:

Advantages that arise from external factors Cost advantages that arise from the expansion of the firm itself Cost advantages that arise from industry-wide expansion Disadvantages that arise from firm expansion

Question 6:

'Perfect Competition' assumes:

Significant barriers to entry Control over prices by individual firms Product differentiation Perfect information and no transaction costs

Question 7:

'Economic Liberalization' typically results in:

Decreased foreign investment Decreased trade with other countries Increased competition and efficiency in the economy Increased government intervention in the economy

Question 8:

'External Economies of Scale' are associated with:

Advantages due to government policies Cost advantages specific to a single firm Cost advantages that accrue to firms as the industry grows Disadvantages due to external factors

Question 9:

The 'Law of Variable Proportions' is also known as:

The Law of Constant Returns The Law of Variable Costs The Law of Increasing Returns The Law of Diminishing Returns

Question 10:

The concept of elasticity of demand is important for businesses because it helps them:

Predict changes in supply Evaluate the impact of advertising Determine pricing strategies Estimate the cost of production

Quiz: Business Economics