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Free CIMAPRA17-BA1-1 Exam Braindumps (page: 13)

Page 13 of 118
PDF with 468 Questions

A 'supply-side' economist would recommend that in the long term, a country's unemployment problem should be tackled by

  1. A reduction in the money supply
  2. Income tax cuts to promote labor market incentives
  3. Tax cuts to expand aggregate demand
  4. Increasing the job-seekers allowance and the period for which it can be claimed

Answer(s): B



The business sector will be affected by a contraction in the money supply because

  1. Interest rates will tend to fall, thus reducing business costs.
  2. Inflation will fall and thus demand in the economy will expand.
  3. Consumer credit will contract thus reducing consumer demand.
  4. The exchange rate will fall thus making business more internationally competitive.

Answer(s): C



In a fully employed economy, which one of the following would lead to demand pull inflation?

  1. A reduction in the rate of income tax
  2. A rise in value added tax
  3. An increase in the world price of oil
  4. A rise in interest rates

Answer(s): A



If a government adopted an expansionary fiscal policy of cutting direct taxes, the businesses that would benefit most would be those whose products:

  1. Are largely bought on credit
  2. Are largely exported
  3. Have a high price elasticity of demand
  4. Are sold mainly to individual consumers

Answer(s): D



Page 13 of 118



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