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QUESTION NO: 1
ToyTown, a soft toy manufacturer, produces what it claims to be the cheapest teddy bears on the market. The graph shows the current price of a ToyTown teddy bear and its relationship to the demand for ToyTown teddy bears.
If the price of ToyTown teddy bears were to increase, what would happen to the demand?
A. Demand would increase as the relationship between price and demand as shown in the graph is elastic
B. Demand would increase because the teddy bears would be seen as more prestigious by consumers due to their higher prices
C. Demand would fall as consumers would look for alternative teddy bears to buy
D. Demand would fall as the relationship between price and demand as shown in the graph is inelastic
Answer: C
QUESTION NO: 2
Which ONE of the following is regarded as a general characteristic of an organization?
A. Social goals towards society
B. Collective goals towards society
C. Controlled performance of its activities
D. Social arrangement of people
Answer: A
QUESTION NO: 3
Central banks fulfill all of the following functions except which?
A. Provider of capital and liquidity to the government
B. Chief advisor to government on taxation policy
C. Holder of bank accounts on behalf of the commercial banks
D. Lender of liquidity to the commercial banks
Answer: B
QUESTION NO: 4
The main purpose of government competition policy is to
A. Restrict anti-competitive behavior by firms
B. Limit the ability of firms to secure long run excess profits
C. Prevent mergers between large companies
D. Enforce competition by breaking up large firms
Answer: A
QUESTION NO: 5
In a recession which ONE of the following would be likely to experience the largest fall in demand for its products?
A. A motor insurance company
B. A toothpaste manufacturer
C. A chain of supermarket grocery stores
D. A manufacturer of industrial machine tools
Answer: D
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Updated: May 28, 2022