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