Question 1

Which one of the following policies to correct a balance of payments current account deficit is an example of an expenditure reducing policy?

Options :

A : Depreciation of the currency.

B : The imposition of an import tax.

C : Increased income tax.

D : The use of import quotas.

Answer: C

Question 2

In a recession which ONE of the following would be likely to experience the largest fall in demand for its products?

Options :

A : A manufacturer of industrial machine tools

B : A chain of supermarket grocery stores

C : A motor insurance company

D : A toothpaste manufacturer

Answer: A

Question 3

Organisations are able to achieve more than individuals can achieve because they allow people to do which THREE of the following?

Options :

A : To devolve decision-making

B : To pool resources

C : To share skills and knowledge

D : To specialise

E : To earn profits

F : To create hierarchies

Answer: A,C

Question 4

Based on the past twenty months, an event decorating company develops a trend equation for forecasting sales revenue (y) where y = 4.38 + 1.32x.

If month 21 has a seasonal factor of times 1.07, then what is the forecast for the month, using a multiplicative model? Give your answer to two decima places.

Options :

A : 34.34

B : 54.54

C : 44.44

D : 64.64

Answer: A

Question 5

A regressive tax is defined as one where:

Options :

A : The amount of tax paid by a taxpayer falls as income rises

B : The rate of tax is different for different income levels

C : The proportion of income paid in tax rises as income falls

D : The tax is levied on expenditure not income

Answer: C

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