Year :
2016
Title :
Economics
Exam :
WASSCE/WAEC MAY/JUNE
Paper 1 | Objectives
41 - 50 of 50 Questions
| # | Question | Ans |
|---|---|---|
| 41. |
Fiscal policy that can control inflation will include the use of A. balanced budgeting B. tax holidays C. budget deficit D. budget surplus Detailed SolutionFiscal policy involves the government changing tax and spending levels in order to influence the level of Aggregate Demand. To reduce inflationary pressures the government can increase tax and reduce government spending.The two main components of fiscal policy are government revenue and government expenditure. In fiscal policy, the government controls inflation either by reducing private spending or by decreasing government expenditure, or by using both. It reduces private spending by increasing taxes on private businesses. |
|
| 42. |
Which is following is a cause of under-development in West Africa A. Availability of manpower B. increasing population C. high rate of capital formation D. large size of market places Detailed SolutionUnderdevelopment in Africa is as a result of many contributing factors which include poverty, illiteracy, very large extended families, corruption and lack of accountability. Poverty is one of the causes of underdevelopment in Africa. Unfortunate events such as slave trade, wars and other bad incidents |
|
| 43. |
Which of the following is not a major problem of development A. shortage of skilled manpower B. inadequate data for planning C. political instability D. poor identification of projects Detailed Solutioncommon constraints on development are high economic poverty, hunger, high mortality rates, unsafe water supplies, poor education systems, corrupt governments, war, and poor sanitation. |
|
| 44. |
The principle of comparative cost advantage was propounded by A. David Ricardo B. Alfred Marshal C. S Mill D. Adam Smith Detailed SolutionDavid Ricardo developed the classical theory of comparative advantage in 1817 to explain why countries engage in international trade even when one country's workers are more efficient at producing every single good than workers in other countries. |
|
| 45. |
The rate at which a country's export is exchanged for her imports is A. trade balance B. balance of payment C. term of trade D. balance on current account Detailed SolutionTerms of trade, relationship between the prices at which a country sells its exports and the prices paid for its imports. |
|
| 46. |
Balance of payment surplus implies that receipts for exports are A. at par with payments for imports B. greater than payment for imports C. less than payment for imports D. proportional to payments for imports Detailed SolutionBALANCE OF PAYMENTS SURPLUS: An imbalance in a nation's balance of payments in which payments made by the country are less than payments received by the country (exports exceeds imports) It's considered favorable because more currency is flowing into the country than is flowing out. |
|
| 47. |
When the international value of a country's currency rises, other things being equal, the country's A. net exports tend to increase B. imports tend to increase C. net exports tend to decrease D. export tend to be stable |
A |
| 48. |
One of the physical measures that can be used to reduce the volume of imports is the A. reduction of personnel income tax B. removal of imports duties C. use of foreign exchange control D. liberalization of credit for importers Detailed SolutionForeign exchange control is the procedure by which a government intervenes in the foreign exchangemarket, banning or restricting sales and purchases of local currencies by non-residents as well as sales and purchases of foreign currencies by residents. when there is no foreign exchange to engage in international trade, imports will fall |
|
| 49. |
When a number of countries agree to remove all trade barriers among themselves and at the same time charge a common tariff against non member countries, it known as A. free trade area B. common market C. custom union D. economic community Detailed SolutionA customs union is generally defined as a type of trade bloc which is composed of a free trade area with a common external tariff. Customs unions are established through trade pacts where the participant countries set up common external trade policy (in some cases they use different import quotas). |
|
| 50. |
Which of the following international organizations is concerned with the stabilization of the balance of payments? the A. International Monetary Fund (IMF) B. World Bank (IBRD) C. United Nations Organization (UNO) D. Economic Commission for Africa (ECA) Detailed SolutionBalance of payments policies; The policies include devaluation, demand management, and controls of various types, all of which have frequently featured in International Monetary Fund (IMF) programmes, either in terms of their encouragement or discouragement. |
| 41. |
Fiscal policy that can control inflation will include the use of A. balanced budgeting B. tax holidays C. budget deficit D. budget surplus Detailed SolutionFiscal policy involves the government changing tax and spending levels in order to influence the level of Aggregate Demand. To reduce inflationary pressures the government can increase tax and reduce government spending.The two main components of fiscal policy are government revenue and government expenditure. In fiscal policy, the government controls inflation either by reducing private spending or by decreasing government expenditure, or by using both. It reduces private spending by increasing taxes on private businesses. |
|
| 42. |
Which is following is a cause of under-development in West Africa A. Availability of manpower B. increasing population C. high rate of capital formation D. large size of market places Detailed SolutionUnderdevelopment in Africa is as a result of many contributing factors which include poverty, illiteracy, very large extended families, corruption and lack of accountability. Poverty is one of the causes of underdevelopment in Africa. Unfortunate events such as slave trade, wars and other bad incidents |
|
| 43. |
Which of the following is not a major problem of development A. shortage of skilled manpower B. inadequate data for planning C. political instability D. poor identification of projects Detailed Solutioncommon constraints on development are high economic poverty, hunger, high mortality rates, unsafe water supplies, poor education systems, corrupt governments, war, and poor sanitation. |
|
| 44. |
The principle of comparative cost advantage was propounded by A. David Ricardo B. Alfred Marshal C. S Mill D. Adam Smith Detailed SolutionDavid Ricardo developed the classical theory of comparative advantage in 1817 to explain why countries engage in international trade even when one country's workers are more efficient at producing every single good than workers in other countries. |
|
| 45. |
The rate at which a country's export is exchanged for her imports is A. trade balance B. balance of payment C. term of trade D. balance on current account Detailed SolutionTerms of trade, relationship between the prices at which a country sells its exports and the prices paid for its imports. |
| 46. |
Balance of payment surplus implies that receipts for exports are A. at par with payments for imports B. greater than payment for imports C. less than payment for imports D. proportional to payments for imports Detailed SolutionBALANCE OF PAYMENTS SURPLUS: An imbalance in a nation's balance of payments in which payments made by the country are less than payments received by the country (exports exceeds imports) It's considered favorable because more currency is flowing into the country than is flowing out. |
|
| 47. |
When the international value of a country's currency rises, other things being equal, the country's A. net exports tend to increase B. imports tend to increase C. net exports tend to decrease D. export tend to be stable |
A |
| 48. |
One of the physical measures that can be used to reduce the volume of imports is the A. reduction of personnel income tax B. removal of imports duties C. use of foreign exchange control D. liberalization of credit for importers Detailed SolutionForeign exchange control is the procedure by which a government intervenes in the foreign exchangemarket, banning or restricting sales and purchases of local currencies by non-residents as well as sales and purchases of foreign currencies by residents. when there is no foreign exchange to engage in international trade, imports will fall |
|
| 49. |
When a number of countries agree to remove all trade barriers among themselves and at the same time charge a common tariff against non member countries, it known as A. free trade area B. common market C. custom union D. economic community Detailed SolutionA customs union is generally defined as a type of trade bloc which is composed of a free trade area with a common external tariff. Customs unions are established through trade pacts where the participant countries set up common external trade policy (in some cases they use different import quotas). |
|
| 50. |
Which of the following international organizations is concerned with the stabilization of the balance of payments? the A. International Monetary Fund (IMF) B. World Bank (IBRD) C. United Nations Organization (UNO) D. Economic Commission for Africa (ECA) Detailed SolutionBalance of payments policies; The policies include devaluation, demand management, and controls of various types, all of which have frequently featured in International Monetary Fund (IMF) programmes, either in terms of their encouragement or discouragement. |