Tag: concept of international trade

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Questions Related to concept of international trade

Multiple choice business economics and quantitative methods introduction to managerial economics theories of employment and income concept of international trade macro economic analysis

Treatment of ITC in respect of a taxable person paying tax under section 7 opts to pay tax under composition scheme?

  1. No liability

  2. Liable to pay an amount equipment to the input tax credit in respect inputs held in state in any form

  3. ITC for input in stock allowed

  4. None of the above
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Under GST composition scheme, when a taxpayer switches to regular scheme, they must pay input tax credit equivalent on inputs held in stock. This prevents abuse of the composition scheme provision.

Multiple choice business economics and quantitative methods introduction to managerial economics theories of employment and income concept of international trade macro economic analysis

Operating Leverage is the response of changes in ____________.

  1. EBIT to the changes in sales

  2. EPS to the changes in EBIT

  3. Production to the changes in sales

  4. None of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Operating Leverage is also known as “Degree of Operating Leverage or "DOL”. The fact is that  the greater use of fixed costs, greater will be  the impact of a change in sales on the operating income of a company. Degree of Operating Leverage Formula = % change in EBIT / % change in Sales.

Multiple choice business economics and quantitative methods introduction to managerial economics theories of employment and income concept of international trade macro economic analysis

Economic activities have two parts:- market activities and ______________.

  1. Same activities

  2. Post activities

  3. Profit activities

  4. First activities

  5. Non-market activities
Reveal answer Fill a bubble to check yourself
E Correct answer
Explanation

  • Market activity refers to the economic activity which includes the production and consumption of goods. These are performed for pay or profit. For example a teacher training in a school, a man working in the bank.
  • Non-marketing activities include things which are not economic and comprises of the exchange system. These are performed for self-consumption. For example subsistence farming, processing of primary products, etc.

Multiple choice business economics and quantitative methods introduction to managerial economics theories of employment and income concept of international trade macro economic analysis

'Closed Economy' is that economy in which __________.

  1. Only export takes place

  2. Money supply is fully controlled

  3. Deficit financing takes place

  4. Neither export nor import takes place
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

The closed economy is that economy in which neither imports nor exports take place in that particular country. As the name suggests the country provides the consumers with everything they need from within the country’s economy.

Multiple choice business economics and quantitative methods introduction to managerial economics theories of employment and income concept of international trade macro economic analysis

According to Modigilani & Miller (MM) theory which of the following statement is correct?

  1. Dividend policy has no effect on value of firm

  2. Firm value depend on its investment policy instead of dividend policy

  3. Key assumption of MM theory is clientele effect

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Clientele effect states that a firm will attract shareholders whose preferences for payment pattern and stability of dividend corresponds to the firm's payment patterns and stability of dividends. 

Multiple choice business economics and quantitative methods introduction to managerial economics theories of employment and income concept of international trade macro economic analysis

Choose the correct answer form the alternatives given.
Which country was known as sick man of Europe?

  1. Greece

  2. Latvia

  3. Turkey

  4. Australia
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Sick man of Europe is a label given to a European country experiencing a time of economic difficulty or impoverishment. The term was first used in the mid-19th century to describe the Ottoman Empire (Turkey).

Multiple choice business economics and quantitative methods introduction to managerial economics theories of employment and income concept of international trade macro economic analysis

In a/an _________ economy goods are demanded by households, firms or producers and the government.

  1. closed

  2. open

  3. mixed

  4. capitalistic
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

A closed economy is one that has no trading action with the external economy. The closed economy is independent, which means no import comes into the country and no exports depart the country. The reason for a closed economy is to provide household consumers with everything they need from within the country's limits.

A closed-household financial system is a society's economic system in which goods are not traded. As an alternative, those goods are shaped and extreme by the same households.

Thus, the correct option is A.

Multiple choice business economics and quantitative methods introduction to managerial economics theories of employment and income concept of international trade macro economic analysis

Two-sector model consists of  ____________ and _____________ sector.

  1. household, business

  2. business, government

  3. household, government

  4. government, foreign
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

A two sector economy, consists of :

  • Household sector, which possesses factors of production and earns factor incomes, which are used to purchase goods and services.
  • Firms/Business sector produces goods and services with the use of factors provided by the households. The factor incomes paid are used to purchase the goods and services produced.

Multiple choice business economics and quantitative methods introduction to managerial economics theories of employment and income concept of international trade macro economic analysis

According to Keynesian model of income determination, an economy's total income in the short run depends on _____________________.

  1. aggregate demand

  2. aggregate supply

  3. demand

  4. all of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

In the Keynesian model, aggregate demand is the primary driver of output and income in the short run because prices and wages are assumed to be sticky.

Multiple choice business economics and quantitative methods introduction to managerial economics theories of employment and income concept of international trade macro economic analysis

A/An _____________ economy is an economy which does not engage in international trade.

  1. open

  2. developing

  3. closed

  4. developed
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

A closed economy is one that has no trading activity with outside economies. The closed economy is therefore entirely self-sufficient, which means no imports come into the country and no exports leave the country. The closed economy is self-sufficient, which means no imports come into the country and no exports leave the country. The purpose of a closed economy is to provide domestic consumers with everything they need from within the country's borders.