An example of external diseconomies is ?

Related Mcqs:

1. Suppose Handel’s Ice Cream experiences economies of scale up to a certain point and diseconomies of scale beyond that point. Its long-run average cost curve is most likely to be ?

   A. downward sloping to the right
   B. U-shaped
   C. Horizontal
   D. upward sloping to the right

2. The external benefits of using cars are ____ and the external costs are _____?

   A. low; low
   B. high; high
   C. low; high
   D. high; low

3. To prevent the external value of the currency from falling the government might ?

   A. Reduce interest rates
   B. Sell its own currency
   C. Buy its own currency with foreign reserves
   D. Increase its own spending

4. A country’s total external debt (EDT) includes ?

   I. short term debt with a maturity of one year or less
   II. long-term debt with a maturity of more than one year
   III. repurchase obligations to the IMF
   IV. IV public official development assistance

   A. I and II only
   B. III and IV only
   C. I, II and III only
   D. I, II and IV only

5. Which of the following is Not true about external debt ?

   A. External debt accumulates with international balance on goods services and income deficcits
   B. When debts are denominated in U.S dollars their appreciation during the 1990s increased the cost of servicing such debts
   C. In the 19901s LDCs relied increasingly on aid from DCs
   D. International lenders required LDC governments to guarantee private debt

6. When the world Bank or IMF requires improved external balance in the short run the agency may condition its loan on expenditure switching that is ?

   A. switching spending from domestic to foreign sources
   B. devaluing local currencies
   C. increase trade restrictions by imposing quota
   D. increase government spending

7. Countries such as ________ that failed to adjust to a persistent external disequilibrium were more vulnerable to poverty displacement and even war ?

   A. Japan and Korea
   B. Brazil and Argentina
   C. Algeria and Yugoslavia
   D. Singapore and Malaysia

8. When several countries jointly impose common external tariffs, eliminate tariffs on each other, and eliminate barriers to the movement of labor and capital among themselves, they have formed a/na ?

   A. free trade area
   B. customs union
   C. common market
   D. economic union

9. If a large number of individuals are affected by an external benefit, private bargaining will not work because of ?

   A. non-rivalry
   B. the free-rider problem
   C. the Coase theorem
   D. the fallacy of composition

10. Starting from a position of internal and external balance a reduction in aggregate demand will cause a current account ?

    A. deficit
    B. surplus
    C. revaluation
    D. devaluation