Economics Balance of Payments – Open Economy Macronomics MCQ Question Answers for Various Entrance Exams

 

1. In this exchange rate system, the _________ fixes the exchange rate at a particular level
a.
b.
c.
d.

2. Net Exports and Net Invisible Cumulatively account as
a.
b.
c.
d.

3. Which one is a demerit of the fixed exchange rate?
a.
b.
c.
d.

4. Which one is a source of the demand of foreign exchange?
a.
b.
c.
d.

5. Other things remaining unchanged, when in a country the price of foreign currency rises, national income is:
a.
b.
c.
d.

6. Which of the following Is a Merit of Fixed Exchange Rate System?
a.
b.
c.
d.

7. Which one is a basis of fixed EXCHANGE RATE?
a.
b.
c.
d.

8. The purchasing Power (PPP) theory is used to make _______predictions about exchange rates in a _______exchange rate system
a.
b.
c.
d.

9. Transfer payments are the receipts which the residents of a country get for ‘free’, without having to provide any goods or services in return. Here Transfer Payments Included
a.
b.
c.
d.

10. Balance of Trade means The Net difference between Trading account and profit loss account
a.
b.
c.
d.

11. Which of the following is Incorrect?
a.
b.
c.
d.

12. The balance of payments Record the transactions in goods, services and assets between residents of a country
a.
b.
c.
d.

13. A surplus current account means that the nation is a __________ to other countries
a.
b.
c.
d.

14. When There is a favourable balance of trade
a.
b.
c.
d.

15. Which of the following is Incorrect?
a.
b.
c.
d.

16. This gives investors the opportunity to choose between domestic and foreign assets
a.
b.
c.
d.

17. Under clean floating, the exchange rate is determined by _________ without any central bank intervention.
a.
b.
c.
d.

18. Foreign exchange is determined by
a.
b.
c.
d.

19. In a fixed exchange rate system, when some government action increases the exchange rate (thereby, making domestic currency cheaper) is called?
a.
b.
c.
d.

20. the country could use its reserves of foreign exchange in order to balance any deficit in its balance of payments. The reserve bank sells foreign exchange when there is a deficit. This is called ________
a.
b.
c.
d.


 


 
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