Randomly Generated Economics Multiple-Choice Practice Exam
Grade: 12
Number of questions: 10

1. The most frequently used mode of payment in Ethiopia for imports is
   direct payment   
   letter of credit   
   bill of exchange   
   banker's transfer   

2. The term tariff, as used in international trade, refers to
   A payment to domestic producers to help them compete in international markets.   
   A mechanism for setting an absolute level on the number of units of a good that can be imported.   
   The price of goods when they leave the producing country.   
   A tax on products being imported.   

3. If a country imposes tariffs on imported goods, what happens to imported goods?
   Imported goods will be expensive relative to domestically produced goods.   
   The domestic consumers will enjoy a higher welfare by consuming more of the imported goods.   
   The price of imported goods will not be affected.   
   Imported goods will be cheaper relative to domestically produced goods.   

4. Which of the following is NOT correct about the industrial sector of Ethiopia?
   As of 2007/08, the share of the private sector in the manufacturing sub-sector is 91.5%   
   The concentration of manufacturing sub-sector in certain areas is desirable because it improves administrative efficiency   
   Food and beverage, textile and non-metallic minerals dominate the manufacturing sub-sector.   
   Large and medium scale-manufacturing enterprises were dominated by public ownership during the Imperial period and the Derg regime.   

5. In the equation C = a + bY, which describes the aggregate consumption function, 'b' stands for
   The amount of income when consumption is zero.   
   The average consumption level.   
   The amount of consumption when income is zero.   
   The marginal propensity to consume.   

6. Which of the following is NOT true in a perfectly competitive market structure?
   Marginal revenue is equal to price.   
   Average revenue is equal to price.   
   Marginal revenue is equal to the average revenue.   
   Average revenue is greater than price.   

7. Which one of the following is NOT true about the tourism sector development policies of the Federal Democratic Republic of Ethiopia?
   Making land available free of lease or at lower rate for investors who plan to invest in tourist attraction areas.   
   Making local communities to benefit from proceeds obtained from tourists who visited attraction resources.   
   Allowing duty free importation of equipment and goods used to construct hotels and other facilities that improve access to tourist attraction areas.   
   Giving less attention to the role of private tour operators in enhancing development of the tourism sector.   

8. Which of the following is an issue most appropriate for macroeconomic analysis?
   The price of maize in Ethiopian cereals market.   
   Impacts of economic crisis on rural unemployment level.   
   Leather demand in the foreign market.   
   The behavior of households in waste disposal.   

9. Individuals are not willing to provide public goods such as streetlights because ______________
   everybody can consume public goods without paying the providers because public goods are non-excludable   
   their value to the society as a whole is smaller than the costs of providing the goods that individuals are not interested in providing them   
   they do not consume them   
   they are not allowed to provide them because provision of public goods should only be accomplished by governments   

10. Which one of the following is NOT true about the tourism sector development policies of the Federal Democratic Republic of Ethiopia?
   Giving less attention to the role of private tour operators in enhancing development of the tourism sector.   
   Making local communities to benefit from proceeds obtained from tourists who visited attraction resources.   
   Allowing duty free importation of equipment and goods used to construct hotels and other facilities that improve access to tourist attraction areas.   
   Making land available free of lease or at lower rate for investors who plan to invest in tourist attraction areas.   



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