CIMAPRA17-BA1-1-ENG Practice Online

Question 1

Which one of the following policies to correct a balance of payments current account deficit is an example of an expenditure reducing policy?

A : Depreciation of the currency.

B : The imposition of an import tax.

C : Increased income tax.

D : The use of import quotas.

Answer: C

Question 2

The main purpose of government competition policy is to

A : Prevent mergers between large companies

B : Restrict anti-competitive behavior by firms

C : Limit the ability of firms to secure long run excess profits

D : Enforce competition by breaking up large firms

Answer: B

Question 3

A wireless phone manufacturer currently sells 2,000 units per quarter at a price of $400 The estimated price elasticity of demand is -2.5.

The manufacturer is considering an increase in the price to $440

What will this raise (+) or reduce (-) total revenue by? Give your answer in whole numbers.

A : $-140000

B : $-130000

C : $-120000

D : $-110000

Answer: A

Question 4

Which of the following influences explains why the average costs of a firm will rise in the short run?

A : Diseconomies of scale

B : Rising unit costs

C : Diminishing marginal returns

D : Diminishing returns to scale

Answer: C

Question 5

Bishops Financial Services has outsourced its HR Department to Resources4U.

Which of the following is most likely to be considered when deciding to outsource parts of the business to another company?

A : Resources4U's lack of business history

B : The cost of increasing the number of staff on the payroll

C : The small size of Bishops Financial Services as a business

D : The possibility of contract renegotiation at a future date

Answer: A

Name:	BA1 - Fundamentals of Business Economics (2017 SYLLABUS) (Online)
Exam Code:	CIMAPRA17-BA1-1-ENG
Certification:	CIMA Certificate in Business Accounting
Vendor:	CIMA
Total Questions:	471
Last Updated:	May 06, 2024