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Decision Makers
Decision Makers MCQs
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Which of the following is not one of the major sectors of the economy?
Households
Businesses
Financial
Government
?
Receipts and expenditures are recorded in the
income statement.
net worth statement.
balance sheet.
historical cost statement.
?
From which sector of the economy does the largest and most volatile source of the funds originate from?
Household and unincorporated businesses
Financial sector
Non-financial sector
Federal government
?
Which sector of the economy is its largest lender?
Government
Businesses
Households
Foreign sector
?
Government budget figures are distorted because of
Limitations to statistical theory
Delays in obtaining the relevant financial information.
Mismeasurement issues related to the magnitude of the required information.
Purchases of assets and current spending are treated the same.
?
One problem with the National Balance Sheet Accounts is that financial institutions report their assets in
historical values.
market values.
values that are always higher than their assets.
transaction values.
?
Another problem with the National Balance Sheet Accounts is that financial institutions report their assets in
constant dollars.
current dollars.
historical values.
terms of purchasing power
?
_______________ shows the difference between revenue and expenses.
A financial flow account
An income statement
A balance sheet
A balance of payments account
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If a sector’s current surplus is less than its current expenditure, then it
Has a surplus.
Has a deficit.
Is in balance.
Makes a profit.
?
If a sector’s current revenue is $200 million and its current expenditure is $450 million, then it
has a surplus of $50 million.
has to borrow $250 million.
has to borrow $50 million.
increases its net worth by $50 million.
?
If the total assets and liabilities of a sector are valued at $400 million and $200 million respectively, then its net worth is
$100 million.
$300 million.
$200 million.
not known because of insufficient information.
?
The Federal Government’s published deficit figure for a given fiscal year is not necessarily the same as its borrowing requirements because of ...
non-budgetary transactions.
a contingency reserve.
non-budgetary transactions and a contingency reserve.
open market operations.
?
Which one of the following is an example of real assets?
Cash
Government Bonds.
Corporate shares.
Houses
?
All of the following are examples a stock variable (as opposed to a flow variable)
Bonds
A house
Equity
Income
?
Which of the following is an example of flow measures?
Expenses
Total assets.
Liabilities
Loans outstanding.
?
Surplus funds in the business sector are referred to as
net worth.
revenue
investment
retained earnings.
?
Analysis of ___________ informs us about capital movements between different sectors of the economy.
The national income accounts.
The input-output table.
The flow of funds.
The capital account.
?
Changes in net worth are equal to
changes in financial assets less changes in liabilities.
changes in non-financial assets less changes in liabilities.
changes in financial assets plus changes in non-financial assets less changes in liabilities.
changes in financial assets plus changes in non-financial assets plus changes in liabilities.
?
An increase in a sector’s holdings of other financial assets indicates
an increase in borrowing.
an increase in lending.
an increase in money holdings.
an increase in liabilities.
?
In the flow of funds, the financial system is
the ultimate source of funds.
the main user of funds.
an intermediary between the sources and users of funds.
not included.