- 1. The market where long-term securities are traded is called the ________.
A) Capital market
B) Commodity market
C) Labour market
D) Money market
- 2. Inflation caused by excess demand over supply is known as ________.
A) Creeping inflation
B) Demand-pull inflation
C) Deflation
D) Cost-push inflation
- 3. Tax avoidance refers to ________.
A) Non-payment of customs duty
B) Smuggling goods
C) Illegal refusal to pay tax
D) Legal reduction of tax liability
- 4. Gross National Product (GNP) is GDP plus ________.
A) Government expenditure
B) Tax revenue
C) Net income from abroad
D) Depreciation
- 5. A budget in which revenue equals expenditure is called ________.
A) Supplementary budget
B) Deficit budget
C) Surplus budget
D) Balanced budget
- 6. The desire to hold money in liquid form is known as ________.
A) Liquidity preference
B) Capital formation
C) Investment
D) Inflation
- 7. Which of the following is a source of government revenue?
A) Taxation
B) Deflation
C) Budget
D) Inflation
- 8. Net Domestic Product (NDP) is obtained by subtracting ________ from GDP.
- 9. One advantage of direct taxes is that they are ________.
A) Regressive
B) Inflationary
C) Optional
D) Progressive
- 10. Which institution issues Treasury Bills?
A) Stock Exchange
B) Insurance Company
C) Central Bank
D) Commercial Bank
- 11. Hyperinflation is also called ________.
A) Deflation
B) Disinflation
C) Runaway inflation
D) Reflation
- 12. Per capita income is calculated by dividing national income by the ________.
A) Labour force
B) Number of firms
C) Total population
D) Government revenue
- 13. A tax levied directly on personal income is known as ________.
A) Direct tax
B) Purchase tax
C) Excise duty
D) Import duty
- 14. A deficit budget occurs when ________.
A) Revenue is zero
B) Revenue equals expenditure
C) Expenditure exceeds revenue
D) Revenue exceeds expenditure
- 15. The quantity theory of money was propounded by ________.
A) Adam Smith
B) David Ricardo
C) Irving Fisher
D) J.M. Keynes
- 16. Which method of measuring national income adds wages, rent, interest and profits?
A) Income method
B) Expenditure method
C) Product method
D) Output method
- 17. One reason for imposing taxes is to ________.
A) Raise government revenue
B) Encourage smuggling
C) Reduce exports
D) Increase inflation
- 18. The market where short-term securities are traded is called the ________.
- 19. Deflation refers to a persistent ________.
A) Rise in wages
B) Fall in output
C) Rise in prices
D) Fall in prices
- 20. Which of the following is an example of recurrent expenditure?
A) Purchase of machinery
B) Building roads
C) Payment of salaries
D) Construction of bridges
- 21. In the equation MV = PT, V stands for ________.
- 22. Disposable income equals personal income minus ________.
A) Imports
B) Consumption
C) Personal tax
D) Savings
- 23. The principle of taxation which requires fairness is called ________.
- 24. One major reason government borrows money is to finance a ________.
A) Budget surplus
B) Deficit budget
C) Trade surplus
D) Tax holiday
- 25. Inflation reduces the ________ of money.
A) Quantity
B) Circulation
C) Supply
D) Purchasing power
- 26. Which of the following is a security traded in the capital market?
A) Treasury Bill
B) Bill of Exchange
C) Call Money Fund
D) Share
- 27. National income is usually measured over a period of ________.
A) Ten years
B) One month
C) One week
D) One year
- 28. Tax evasion is ________.
A) Constitutional
B) Legal
C) Illegal
D) Voluntary
- 29. Which type of inflation is characterized by a slow but steady rise in prices?
- 30. Government expenditure on roads and bridges is known as ________.
A) Transfer payment
B) Revenue expenditure
C) Recurrent expenditure
D) Capital expenditure
- 31. Which of the following is an instrument of the money market?
A) Debenture
B) Treasury Bill
C) Bond
D) Share
- 32. A budget surplus is desirable during periods of ________.
A) Recession
B) Inflation
C) Unemployment
D) Deflation
- 33. GDP stands for ________.
- 34. The item upon which tax is calculated is called the ________.
A) Tax incidence
B) Tax burden
C) Tax base
D) Tax rate
- 35. Which of the following is a cause of inflation?
A) High savings
B) Excessive bank lending
C) Reduced demand
D) Budget surplus
- 36. National debt refers to debts owed by the government ________.
A) Externally only
B) Internally only
C) Internally and externally
D) By companies only
- 37. The principle that tax should be easy to understand is called ________.
A) Flexibility
B) Simplicity
C) Neutrality
D) Convenience
- 38. Holding money for unforeseen emergencies is known as the ________ motive.
- 39. One reason for measuring national income is to determine the ________.
A) Political party strength
B) Growth rate of the economy
C) Religious composition
D) Climate condition
- 40. Given that price of a Radio set in 2010 was N338, but rose to N362 in 2011. Calculate the price index of the radio in percentage.
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