International Economics

1.IMF came into existence in

Correct Answer
1945

2.Inspite of continuous & consistent decline in customs duty since 1991, there have been no
excessive increase in imports.
Correct Answer
True

3.The software module that is responsible for locking is :

Correct Answer
Lock Manager

4.The mode in which data can be read but not written is called as :
Correct Answer
Shared Lock

5.Quota or tariffs represent ________ which means that the imposing country dose it without
taking into account the views of the exporting country.
Correct Answer
Unilateral action

6.According to Posner why dose it take time to imitate?

Correct Answer
Because it takes new items to set up a new industry , Marketing for a inferior product in the
international market , Due to foreign reaction lag

7.Credit worthiness of a country is judged by ________

Correct Answer
Size of it’s reserves

8.Long term economic reforms for enhancing export trade include -

Correct Answer
Enhanced linkage with the world economy , Doing away from quantitative restrictions ,
Following the code of transparency in the working of the foreign trade sector

9.In Lock-S(Q) where Q is the data item stand for :

Correct Answer
Shared lock on data item Q
10.What is a proportionate tax?
Correct Answer
10% to 15 % of the value of good is collected in the form of tax , Sometimes the tax is not flat
, In this type of tax concessions are also made for the close partners

11.What is Free on board?

Correct Answer
Only produces value is taken into account for tariff

12.Match The Following

On & Off-Binary Lock

Two phase locking-Shrinking & Growing

Timestamps-Use of system clock or logical counter

Multiversion-Multiple copies

13.Main intention behind the meet-up of the IMF & the World Bank in 1989 was
Correct Answer
Minimizing interferences in the free foreplay of the market forces for economic restructuring

14.Under the classifcation system, since 1996, the code has been further hiked from ________

Correct Answer
8 digit to 10 digit

15.If due to exports the domestic producer feels threatened then they can resort to ________
non tariff barrier.
Correct Answer
Orderly marketing arrangements

16.By shifting labor which is skilled in a particular sector we impose a ________ on society
Correct Answer
Net burden

17.What happens when the trade is opened internationally?

Correct Answer
Internal price ratios will no longer be valid , A uniform price ratio will be established

18.For the purpose of systematized classification of trade data, SITC divides all such
commodities into -
Correct Answer
10 sections , 52 divisions , 180 items

19.Current account deficit/surplus met by opposite movement from the capital account helps
to correct the disequilibrium in the foreign exchange market
Correct Answer
True

20.The list of traded items included in the bag of custom duty reduction points out that the
concessions are tilted towards benefitting the foreign suppliers more than the domestic
producers.
Correct Answer
False

21.Match The Following

Partial specialization-If one country is small and can not cope up with international market, in
that case the competing country will produce 2 commodities.

Absolute Advantage-Absolute advantage in production of one commodity

Exchange Ratio-The equilibrium exchange ratio must lie between the two pre trade ratio
The equilibrium exchange ratio must lie above the two pre trade ratio
Comparative cost-Comparative advantage in production of one product

22.Optimistic schedulling follow three phases, they are:

Correct Answer
Read phase , Validate phase , Write phase

23.In free trade area the member countries maintain the respective previous tariff rate with the
rest of the world
Correct Answer
True

24.How will government intervene in the intra – industry trade?

Correct Answer
By the policy of import substitution and export substitution.

25.What will be the outcome of trade in the tariff on import is reduced?

Correct Answer
Price in importing sector will come down. , Decline in output

26.What was the theory given by Adam Smith called?

Correct Answer
Absolute advantage theory

27.A data item X can be unlocked through :

Correct Answer
Unlock(Q)

28.Sometime the system is deliberatley allowed to enter deadlock in order to use:

Correct Answer
Deadlock detection , Deadlock recovery

29.For the purpose of systematized classification of trade data, SITC divides all such
commodities into -
Correct Answer
10 sections , 52 divisions , 180 items

30.To look after activities in the four public sector insurance companies Govt of India has
formed ________
Correct Answer
General Insurers’ (Public Sector) Association Of India.

31.Dispute Settlement Board is a part of ________

Correct Answer
WTO

32.What are the common characteristics of a economic integration?

Correct Answer
Cooperation in many other fields , Tariff withdrawal

33.After passing the IRDA bill in 1999, Govt. decided to decentralize the GIC.from their four
subsidiaries and allowed these companies to run it independently.
Correct Answer
True

34.From the world report of personnel lines of buisiness the share of world premium is lower
side of the following countries
Correct Answer
East Europe , Latin America , Rest (incl India)

35.For regulations of insurance business the first Indian insurance act was passed in the year
Correct Answer
1912

36.ECM countries are a very important source both for imports & exports.
Correct Answer
True

37.According to which theory technology can lead to change factor intensity of a product?
Correct Answer
Leontife Paradox

38.The countries that agreed to various articles of GATT was know to be ________.
Correct Answer
Contracting parties

39.In wait-die scheme the older transaction waits for a younger one to release its data item.
Correct Answer
True

40.Which of the following Insurance Companies are the promoters for “Agricultural
Insurance Company of India Ltd.”
Correct Answer
New India , Oriental , United India

41.Under the classifcation system, since 1996, the code has been further hiked from ________

Correct Answer
8 digit to 10 digit

42.At the birth of the IMF, one ounce of gold was priced at $30.
Correct Answer
False

43.Real effective exchange rate engulfs

Correct Answer
Relative price movements ( domestic & foreign )

44.The year ________ shows the highest degree of incease in the customs duty over the
previous year.
Correct Answer
1994-95

45.What is a Common market?

Correct Answer
In this case there is no tariff on internal movement of goods but there is a common external
tariff against the rest of world.

46.Which of the following sectors of personal Insurance are still untapped.

Correct Answer
Mediclaim , Householders , Per.Accidient
According to H-O theory a capital intensive country will produce ________
Correct Answer
Combination of two goods but will produce more of capital intensive goods

47.Objectives of the IMF

Correct Answer
Stability in the BOP , Stability in internal price level , Stability in the exchange rate

48.If production takes place at the optimum level price will be not be equal to the minimum
average cost of production
Correct Answer
False

49.In case of exports, agriculture has surpassed gems & jewellery in terms of a higher rate of
increase, though lesser in absolute figure.
Correct Answer
True

50.Why is it so common to give protection to infant industry?

Correct Answer
Because the new firms are weak and vulnerable , Unless the conditions are conducive ,
expansion in output cannot be assured , To discourage the imports

51.Current account balance is important in determining nation’s________

Correct Answer
External Investment position

52.The reigns of policy formulation & operations of the World Bank are in the hands of the
Board of Directors.
Correct Answer
False

53.IMF or World Bank want trading counties to follow a uniform code of classification to
emphasis their importance on the world economy.
Correct Answer
False

54.Under perfect competition same price for ________ will prevail in the product market and
price of factors of production also will be same for same varieties
Correct Answer
Identical commodities

55.________ hypothesis advocates globalisation, that it accelerates the country’s growth

process
Correct Answer
Convergence

56.In case of tangency between price ration & production possibility cure – post Globalisation
– is achieved at a parallel but lower level, then it shows that …
Correct Answer
Production capabilities of both the goods have declined

57.Apart from the gold or foreign curreny, the quota that each country had to pay was based
on ..
Correct Answer
Size of GDP

58.Balance of payment includes …

Correct Answer
Current Account , Capital Account , Reserve Movements

59.Production equilibrium is realised at the point of tangency between the production

possibility curve and factor price ratio.
Correct Answer
True

60.Match The Following

REGULATOR FOR INSURANCE SECTOR-EFFECTIVE WATCH DOG
HOLDING COMPANY &FOUR SUBSIDIARIES.-GIC & New india,united,oriental,national

THE POTENTIAL &SCOPE WHICH IS STILL UNDER TAPPED-PERSONAL LINE OF

INSURANCE & HEALTH CARE AREA.

RECENT DEVELOPMENT BY GOVT OF INDIA-SET UP AN AGRICULTURE

INSURANCE COMPANY OF INDIA.

61.Why is it that factor price equalization is not found frequently in countries?

Correct Answer
Presence of factor cost

62.The inception of WTO dates back to 1995

Correct Answer
True

63.In multiversion scheme to ensure serailizibility it is necessary that a transaction should be

able to determine easily and quickly which version of the data item should be read.
Correct Answer
True

64.What was the main reason for rise in price during 1970′s?
Correct Answer
rise in petroleum prices

65.Globalisation started taking root in the world economy since the

Correct Answer
Eighties

66.When a particular transaction never makes progress because the data item it wants to lock
is already locked and other transaction are also waiting for the same data item then it is said to
be
Correct Answer
Starvation

67.Wait-die scheme is based on preemptive technique.

Correct Answer
False

68.According to the Absolute advantage theory why will there be any kind of difference in
cost of the same product in two countries?
Correct Answer
Due to productivity

69.What are the problems being faced by the developing countries due to reduced trade
barriers?
Correct Answer
entering of giants in the market , stiff competition to the local trades

70.Developed countries come closer through trade because consumption patterns are know to
each other
Correct Answer
True

71.What is reason behind many Latin American and African countries forming a union?
Correct Answer
These countries have put a common front against the imperial power

72.Wound wait and wait die schemes avoids starvation.

Correct Answer
True

73.A transaction may release locks, but may not obtain any new locks this phase is called as
Correct Answer
Shrinking Phase

74.Match The Following

Real protection-An industry takes into account the higher prices a producer has to pay on
imported inputs owing to imposition of tariffs
Tariff barriers-Specific tariff
Non Tariff barrier-Quotas
Effective protection-The proportion of total costs accounted for by imported inputs

75. Invisible Trade comprises …

Correct Answer
Travel & Transport , Insurance , Interest Payments

76.Identify the assumptions of H-O theory?

Correct Answer
Technology in both the country are same , Production function of a commodity is same

77.Apart from international reserves, ________ also widens the monetary base of the central
bank.
Correct Answer
Net domestic assets
In case of multiple peg, the domestic currency changes propotionately to any change in
exchange rates of nations of the basket
Correct Answer
False

78.The institutional aspect of reforms refer to

Correct Answer
It’s proper & effective implementation

79.Why is tariff imposed?

Correct Answer
Because it is the major source of revenue , To attain self-sufficiency in the country , To give
protection to the domestic countries

80.What are the main highlights of Product life cycle?

Correct Answer
These are normally labor scarce countries , Producers use more capital than labor , Money is
spent in research and development to innovate new ways of using capital intensive technique

81.Day to day functioning & policy implementation of the IMF are the responsibilities of the
Correct Answer
Executive Directors

82.The rate of increase in the India’s trade deficit as seen is highest in the year -
Correct Answer
1998-99

83.Does a big population mean a big labor force?

Correct Answer
It is always compared in relation to the other factors

84.Due to Export Subsidy selling price abroad ________ the home market price
Correct Answer
Will be less than
85.The AMS completely believed & worked on lines of poverty eradication & rural
upliftment.
Correct Answer
False

86.How dose a country determine the imports and exports items of a particular country?
Correct Answer
By comparing hourly output per labor , The country with least average cost would be ideal

87.According to SITC codification scheme, in the import or the export list, any food item was
given the code 00 & crude petroleum was given 03.
Correct Answer
False

88.Pegged Exchange rate was initially advocated by

Correct Answer
IMF

89.Complete specialization would mean that a country will produce only one product and
________ production for other products.
Correct Answer
exchange surplus

90.Pegged Exchange Rate came to be known as ________.

Correct Answer
Official Exchange Rate

91.________was introduced by the IMF in 1967

Correct Answer
SDR

92.The main obsticle experienced in tha way of regional blocks is that after growing for 10-15
years ________ reaches a plateau
Correct Answer
internal trade expansion