Q.1.2 A deficit on the current account of a country's balance of payments can be financed by a surplus: (1) Of exports over imports; (2) Of net gold exports; (3) On the financial account; (4) On the trade balance.
Q.1.2 A deficit on the current account of a country's balance of payments can be financed by a surplus: (1) Of exports over imports; (2) Of net gold exports; (3) On the financial account; (4) On the trade balance.
Chapter1: Making Economics Decisions
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Transcribed Image Text:Q.1.2
A deficit on the current account of a country's balance of payments can be
financed by a surplus:
(1) Of exports over imports;
(2) Of net gold exports;
(3) On the financial account;
(4) On the trade balance.
Q.1.3
Assume that Denmark has a Gini co-efficient of 0.2. This means that it has a(n):
(1) Equal distribution of income;
(2) Unequal distribution of income;
(3) Perfectly equal distribution of income;
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(4) Perfectly unequal distribution of income.
Transcribed Image Text:Q.1.4
News about high levels of criminal activity in South Africa discourages American
tourists from visiting South Africa. This decline in the number of tourists from the
USA will lead to:
(1) A decrease in the demand for dollars and a subsequent depreciation of the
rand against the dollar.
(2)
An increase in the supply of dollars (leftward shift of the supply curve)
causing an appreciation of the rand against the dollar.
(3)
A depreciation of the rand against the dollar and a consequent decrease in
the rate of inflation.
(4) A depreciation of the rand against the dollar and a consequent rise in the
rate of inflation.
Q.1.5
An appreciation of the rand against the dollar:
(1) Will worsen the current account balance but improves domestic prices;
(2)
Will improve the current account balance but worsen domestic prices;
(3)
Will improve the current account balance as well as improve domestic
prices;
(4) Will worsen both the balance on the current account as well as domestic
prices.
Q.1.6
A surplus on the current account of the balance of payments indicates that:
(1) Financial inflows are less than financial outflows;
(2) Imports are greater than exports;
(3) Financial inflows are greater than financial outflows;
(4) Exports are greater than imports.
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