Economics Multiple Choice Questions (1 Viewer)

[michaeljennings]

Which of the following best describes the impact of an increase in Australia's national savings
a) There will be an increased reliance on foreign borrowing
b) There will be a decreased reliance on foreign borrowing
c) The impact on foreign borrowings will depend on the capital adequacy requirements for banks
d) Foreign debt will fall

Is it b or d?? arent b and d the same thing?

What is the likely effect of an economic downturn in Australia's major trading partners on Australia's external balance
a) Decreased demand for exports leading to a TWI depreciation
b) decreased demand fo exports leading to a TWI appreciation

Which group of countries achieved the fastest growth in the 1990s
a) High income
b) Newly Industrialised
c) Transition
d) Developing

An explanation of the first two would be greatly appreciated, thanks

 

[sakatahahaha]

Which of the following best describes the impact of an increase in Australia's national savings
a) There will be an increased reliance on foreign borrowing
b) There will be a decreased reliance on foreign borrowing
c) The impact on foreign borrowings will depend on the capital adequacy requirements for banks
d) Foreign debt will fall


Is it b or d?? arent b and d the same thing?

Okay this one is tricky and weird because b and d are kind of the same. Although i will go with B higher national saving will decrease our reliance on foreign borrowing ( low national savings is the major reason why we rely so much on foreign investment and borrowing ) although it wouldn't mean our debt will fall we will still have debt that's my reasoning for choosing B.

What is the likely effect of an economic downturn in Australia's major trading partners on Australia's external balance
a) Decreased demand for exports leading to a TWI depreciation
b) decreased demand fo exports leading to a TWI appreciation

A down turn >> less demand >> less Australian exports >> deterioration in T.O.T

Which group of countries achieved the fastest growth in the 1990s
a) High income
b) Newly Industrialised
c) Transition
d) Developing

C countries who began the globalisation process and the liberalisation of trade early have reaped the greatest rewards in the 20th century. That's why India and China are still not up their as advanced because they just recently began the transition process

 

[michaeljennings]

For the 2nd one, its trade weight index not terms of trade sorry, but thats for the explanation for the other two

 

[Aindan]

1. C - I've seen this question before and got teh answer wrong myself, still dunno why. insights appreciated
2. B - Less demand for exports -> less demand of $AUD -> depreciation
3. B - for sure, dunno what the guy above said.

 

[Bobbo1]

1. C - I've seen this question before and got teh answer wrong myself, still dunno why. insights appreciated
2. B - Less demand for exports -> less demand of $AUD -> depreciation
3. B - for sure, dunno what the guy above said.

Agreed, for (3) newly industrialism economies such as the Asian Tigers - Singapore, Hong Kong, Taiwan and South Korea had large amounts of growth

 

[powlmao]

It should be New Industrialised Countries

 

[gurmies]

http://en.wikipedia.org/wiki/Basel_II