Class 12 Macroeconomics MCQ Questions of Open Economy Macroeconomics with Answers were prepared based on the latest exam pattern and syllabus. Important MCQ Questions for Class 12 Economics Open Economy Macroeconomics with Answers, which is outlined by expert Economics teachers from the latest version of CBSE Books. Our teachers have provided below Open Economy Macroeconomics Class 12 Economics MCQs Questions with answers which will help students to revise and get more marks in exams
We have provided Open Economy Macroeconomics Class 12 Economics MCQs Questions with Answers to help students understand the concept very well. Practice the MCQ Questions for Class 12 Economics Open Economy Macroeconomics with Answers here.
Let's start your preparation with these MCQ Questions which helpful to revise all the concepts easily: -
1. The price of one currency in terms of another is known as _________
(A) Foreign exchange rate
(B) Trade rate
(C) Interest rate
(D) Balance of Payment
2. The market where the national currencies are traded for one another is known as ________
(A) Domestic exchange market
(B) Foreign exchange market
(C) Bazaar
(D) Shop
3. Increase in the value of foreign commodities is known as _________
(A) Revaluation
(B) Devaluation
(C) Inflation
(D) None of these
4. Decrease in the value the foreign commodities is known as _________
(A) Revaluation
(B) Devaluation
(C) Deflation
(D) All of these
5. What is the cause of the devaluation of any country’s currency?
(A) Increase in the domestic inflation rate
(B) Domestic real interest rates are less than foreign interest rates
(C) Much increase in the income
(D) All of these
6. The operation of daily nature in the foreign exchange market is known as ________
(A) Spot market
(B) Forward market
(C) Domestic market
(D) International market
7. Foreign exchange transactions which are independent of other transactions in the Balance of Payments Account are called:
(a) Current transactions
(b) Capital transactions
(c) Autonomous transactions
(d) Accommodating transactions
8. What is the cause of the devaluation of any country’s currency?
(a) Increase in the domestic inflation rate
(b) Domestic real interest rates are less than foreign interest rates
(c) Much increase in the income
(d) All of these
9. The operation of daily nature in the foreign exchange market is known as
(a) Spot market
(b) Forward market
(c) Domestic market
(d) International market
10. The operation of future delivery in the foreign exchange market is known as
(a) Spot market
(b) Current market
(c) Forward market
(d) Domestic market
11. Trade of visible items between the countries is known as
(a) Balance of Payment
(b) Balance of Trade
(c) Deficit Balance
(d) All of these
12. When the import and export of visible items are equal, the situation is known as
(a) Balance of Trade
(b) Balance of Payment
(c) Trade Surplus
(d) Trade Deficit
13. Increase in the value of foreign commodities is known as _________
(a) Revaluation
(b) Devaluation
(c) Inflation
(d) None of these
14. Measures to improve adverse balance of payment includes :
(a) Currency devaluation
(b) Import substitution
(c) Exchange control
(d) All of the above.
15. When the import and export of visible items are equal, the situation is known as
(a) Balance of Trade
(b) Balance of Payment
(c) Trade Surplus
(d) Trade Deficit
16. Types of Foreign Exchange Market are:
(a) Spot market
(b) Forward market
(c) Both (a) and (b)
(d) None of these
17. Foreign exchange is determined by:
(a) Demand for foreign currency
(b) Supply of foreign currency
(c) Demand and supply in the foreign exchange market
(d) None of the above
18. Hybrid in management of fixed and flexible exchange rate is known as ________
(a) Managed to float
(b) Crawling Peg
(c) Wider Bands
(d) None of these
19. Balance of Trade means :
(a) Capital Transaction
(b) Import and export of goods
(c) Total debit and credit
(d) All the above
20. Which one is the visible item of Balance of Payments?
(a) Machine
(b) Cloth
(c) Cement
(d) All of these
21. Which among the following is a source of supply of foreign exchange?
(a) Donations given
(b) Imports
(c) Exports
(d) Gifts
22. Which one is a king of exchange rate ?
(a) Fixed Exchange Rate
(b) Flexible Exchange Rate
(c) Both (a) and (b)
(d) None of the above
23. Which of the following is true ?
(a) Fixed exchange rate is determined by the government
(b) Flexible exchange rate is determined by market forces (demand and supply of foreign exchange)
(c) Both (a) and (b)
(d) None of the above
24. Which one is a kind of fixed exchange rate ?
(a) Gold Standard System of Exchange Rate
(b) Bretton Woods System of Exchange Rate
(c) Both (a) and (b)
(d) None of the above
25. Which one is a merit of fixed exchange rate ?
(a) Promotes Foreign Trade
(b) Induces Foreign Capital
(c) Increases Capital Formation
(d) All the above
