Tag: economics

Questions Related to economics

The National Stock Exchange recently launched Interest Rate Futures (IRF). IRF in fact is a ______________.

international experience of exchange rate systems open economy macroeconomics international economics economics

  1. new mode of trading specifically for SME sector

  2. financial mode of trading

  3. electronic mode of transferring money from one account to another

  4. safest and fastest mode of trading at all the stock exchanges of India simultaneously

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Correct Option: B
Explanation:

The National Stock Exchange recently launched Interest Rate Futures (IRF).

IRF in fact is a financial mode of trading as investors can buy and sell interest rate futures contracts from different locations in the country through registered NSE brokers in the same manner as they buy and sell equities and derivatives today. The financial settlement of all the trades is guaranteed by National Securities and Clearing Corporations Ltd (NSCCL).

The Smithsonian Agreement was a temporary agreement negotiated in ____________.

international experience of exchange rate systems open economy macroeconomics international economics economics

  1. 1971

  2. 1976

  3. 1970

  4. 1980

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Correct Option: A

Many times we read about 'PPP' in economic literature. What is PPP?

international experience of exchange rate systems open economy macroeconomics international economics economics

  1. Tells us the exchange rates between currencies are in equilibrium when their purchasing power is the same in both the countries

  2. It tells us the exchange rates between currencies are in equilibrium when they are adjusted for differences in purchasing power.

  3. PPP means the current exchange rate of a currency against US$

  4. A measure of income inequality in developing countries

Show answer
Correct Option: B
Explanation:

The acronym PPP stands for, "Purchasing Power Parity". It is a method of currency valuation that tells us that the exchange rate between two countries must be equal to the ratio of the currencies' respective purchasing power. ie. two identical goods should eventually cost the same in different countries once adjusted for purchasing power parity.

The Bretton Woods Conference set up the ________________.

international experience of exchange rate systems open economy macroeconomics international economics economics

  1. World Bank

  2. IMF

  3. Asian Development Bank

  4. WTO

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Correct Option: B

Full form of SDRs:

international experience of exchange rate systems open economy macroeconomics international economics economics

  1. Suitable Drawing Rights

  2. Special Drawing Rights

  3. Special Derivation Rights

  4. None of the above

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Correct Option: B
Explanation:

Special drawing rights. Special drawing rights (abbreviated SDR, ISO 4217 currency code XDR (numeric: 960)) are supplementary foreign exchange reserve assets defined and maintained by the International Monetary Fund (IMF).

The Triffin Dilemma was named after ____________. 

international experience of exchange rate systems open economy macroeconomics international economics economics

  1. John Triffin

  2. Robbert Triffin

  3. Henry Triffin

  4. Adam Triffin

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Correct Option: B

Which conference had given birth to International Monetary Fund?

international experience of exchange rate systems open economy macroeconomics international economics economics

  1. Uruguay Round Conference

  2. Round Table Conference

  3. Bretton Woods Conference

  4. Simla Conference

Show answer
Correct Option: C
Explanation:

The Bretton Woods conference was held in washington, DC in 1944. It was the period after the great depression and most economies in Europe were failing thus the IMF was set up as a bank where member states could draw from to maintain economic activity and employment through periodic crises.

The Gold Standard was from the period _______________.

international experience of exchange rate systems open economy macroeconomics international economics economics

  1. 1872-1920

  2. 1870-1914

  3. 1865-1900

  4. 1870-1900

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Correct Option: B

The Smithsonian agreement devalued the U.S. dollar by _________ relative to gold.

international experience of exchange rate systems open economy macroeconomics international economics economics

  1. 9.5%

  2. 8.5%

  3. 8%

  4. 9%

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Correct Option: B

FOB stands for  _______.

international experience of exchange rate systems open economy macroeconomics international economics economics

  1. Free On Board

  2. Free Of Bond

  3. Freight On Board

  4. Freedom Of Bond

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Correct Option: A