Goodbye
True or False
Automatic stabilisers are changes in government spending and taxation that occur to reduce fluctuations in aggregate demand without any alteration in government policy.
True
True or False
Discretionary fiscal policy are deliberate changes in government spending and taxation.
True
True or False
Cyclical budget deficit is a budget deficit caused by an imbalance between government spending and taxation.
False
Cyclical budget deficit is a budget deficit caused by changes in economic activity.
True or False
Expenditure switching policy is policy measures designed to reduce imports and increase exports by reducing demand.
False
Expenditure switching policy is policy measures designed to encourage people to switch from buying foreign-produced products to buying domestically produced products.
True or False
Interest rate is the total amount of money in a country.
False
Interest rate is the price of borrowing money and the reward for saving.
Multiple Choice
These are external sources of finance, except:
A. Share issue
B. Grants
C. Sales of assets
D. Creditors
E. Leasing
C
Multiple Choice
These are the rights of shareholders as main financial stakeholders, except ....
A. part ownership of the company in proportion to the number of shares owned
B. to attend the AGM and vote
C. to receive dividend as recommended by the board
D. to receive payment as agreed
E. to receive a share of the capital if the business is wound up aft er all debts have been paid
D
Multiple choice
It means costs that do not vary with output in the short run.
A. direct costs
B. indirect costs
C. variable costs
D. marginal costs
E. fixed costs
E
Multiple Choice
This is the direct cost of a construction company.
A. Office rent
B. Subcontractor expenses
C. Administrative staff
D. Equipments and tools
E. Marketin and advertising
B
Multiple choice
Reduction in working capital is included in the ... sources of finance.
A. internal
B. external short term
C. external medium term
D. external long term
E. none above
A
Short answer
This is the use of interest rates, direct control of the money supply and the exchange rate to influence aggregate demand.
Monetary policy
Short answer
This is an annual statement in which the government outlines plans for its spending and tax revenue.
Budget
Short Answer
This is selling of claims over trade receivables to a debt factor in exchange for immediate liquidity – only a proportion of the value of the debts will be received as cash.
Factoring
Short Answer
This is measures designed to increase aggregate supply.
Supply side policy
Short Answer
This is bonds issued by companies to raise debt finance, oft en with a fixed rate of interest.
Debentures
Calculation
If fixed costs are $12,321 and the contribution per unit of output is $111, then the break-even level of production is ... units.
111
Calculation
Jvnism Ltd has operating profit $11,111 and revenue $55,555. The operating profit margin is … %
20
Calculation
The break-even output is 246 units and current production is 369 units. Production over break-even pointis .... %.
50
Calculation
TaniaMania Ltd has current assets $2,456 and current liabilities $1,228. The current ratio is ….
2
Calculation
The break-even output is 789 units and current production is 1234 units. The margin safety is .... units.
445
There are 6 factors to be considered in making the ‘source of finance’ decision:
1. Use to which finance is to be put
2. Cost
3. Amount required
4. Legal structure and desire to retain control
5. Size of existing borrowing
and 6 is ....
Flexibility
Diagnostic equipment, tire changers, wheel balancers, air compressors, hand tools, power tools are direct cost examples of ....
car garage/
automotive repair service
There are three instruments in monetary policy. They are interest rate, money supply, and ....
exchange rate
It is when a firm ceases trading and its assets are sold for cash to pay suppliers and other creditors.
Liquidation
There are 6 main government macroeconomic policy aims. They are:
1. low and stable inflation
2. balance of payments equilibrium
3. steady and sustained economic growth
4. avoidance of exchange rate fluctuations
5. sustainable economic development
And one more is ....
Full employment