CIMA BA1 Exam Questions Free Practice Test

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Viewing questions 101-110 out of questions

Questions # 101:

If the production of a good involves an external social cost, resource allocation could be improved by:

Options:

providing a subsidy for the consumers of the good

imposing an indirect tax on the good

providing a subsidy for the producers of the good

the government imposing price controls to reduce the price of the good.

Expert Solution

Questions # 102:

Which of the following equations is correct regarding interest rates?

Options:

Real interest rate = Nominal interest rate + Expected inflation rate

Real interest rate = Nominal interest rate + Market risk premium

Nominal interest rate = Real interest rate + Expected inflation rate

Nominal interest rate = Real interest rate + Market risk premium

Expert Solution

Questions # 103:

A research business compiles the following data for Country D over 8 years:

* Household expenditure, y (in millions of constant 20X6 dollars);

* The number of fixed broadband internet subscribers, x (in thousands).

Based on this information the following regression model is developed:

y = 332668 * 45.8x - 0 003x2

Which of the following statements is correct?

Options:

The model is based on historical data, so it is of little use in making forecasts

1 percent increase in the number of fixed broadband internet subscribers will lead to 0 3 percent increase in household final consumption expenditure.

A non-linear relationship is suggested by the model between household final consumption expenditure and the number of fixed broadband internet subscribers.

The model makes accurate forecasts on household final consumption expenditure in Country and therefore it should be widely applied to most countries and regions.

Expert Solution

Questions # 104:

Which of the following statements defines a diseconomy of scale?

Options:

A reduction in the unit average cost caused by increasing the scale of production in the long run.

An increase in the unit average cost caused by increasing the scale of production in the long run

An increase in the unit average cost caused by decreasing the scale of production in the long run.

A reduction in the unit average cost caused by decreasing the scale of production in the long run.

Expert Solution

Questions # 105:

A business sells 10,000 units of its product pet month at a unit price of $10 It reduces the pnce to $88,000 per unit As a result its total reviewed $88,000 per month. What is the price elasticity of demand for this product?

Options:

+1.87

+0.6

-2

-0.5

Expert Solution

Questions # 106:

industrial action is more likely to occur within a large organisation than a small organisation, due to senior management becoming re managers becoming complacent, as well as shop floor hostility. The effect of this will be an increasing average cost as production

The statement above is most closely describing an example of which of the following?

Options:

External diseconomy of scale.

Internal diseconomy of scale

Internal economy of scale

External economy of scale

Expert Solution

Questions # 107:

What is the mam objective or the PESTEL framework?

Options:

To identify the key factors in the business environment that are likely to affect a company's performance

To identify the key determinants of a company's profitability

To identify the key people who should be involved in a company's decision making process

To identify the key external stakeholders that are likely to be impacted by a company's activities.

Expert Solution

Questions # 108:

Which of the following types of graph uses cumulative frequency distributions to illustrate information?

Options:

Bar chart

Histogram

Scatter graph

Ogive

Expert Solution

Questions # 109:

Which of the following is an example of an indirect tax?

Options:

Corporation tax

Income tax

Inheritance tax

Sales tax

Expert Solution

Questions # 110:

Company A is looking to protect itself from transaction exchange rate risk.

Company A does not require 100% of the value of transaction to be protected, and it would like the method it uses to have the following characteristics

• An agreed exchange rate for a specified period where both parties have a legal obligation

• A separation of the contract guaranteeing the pnce of the currency from the underlying transaction.

Which of the following would best provide the type of protection from exchange rate risk company A wants?

Options:

Future

Option

Forward contract

Floating exchange rate

Expert Solution

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