Question :
111.Since the early 1970s, developed countries such as Great Britain : 1299400
111.Since the early 1970s, developed countries such as Great Britain and the United States have financed their trade deficits by:
A. borrowing from the World Bank.
B. borrowing private money.
C. selling their gold reserves.
D. drawing on grants from the International Monetary Fund.
E. increasing their imports.
112.Which of the following is a reason why Great Britain and the United States could finance their deficits by borrowing private money since the early 1970s?
A. The rapid development of global capital markets
B. Shortage of International Monetary Fund grants available for disbursal
C. High interest rate charged by the International Monetary Fund
D. Establishment of currency boards in these countries
E. Decline of the Bretton Woods system
113.Which of the following observations about the International Monetary Fund (IMF) is true?
A. With the collapse of the Bretton Woods system, the membership of the IMF has reduced.
B. The IMF has been criticized for granting loans to the governments without enacting any macroeconomic policies.
C. The IMF has refused to lend money to troubled economies experiencing financial crises.
D. The IMF’s activities have expanded because periodic financial crises have continued to hit many economies in the post-Bretton Woods era.
E. Under the International Development Association scheme, the IMF offers long-term loans to governments of underdeveloped nations whose credit rating is poor.
114.Which of the following is an implication of a currency crisis?
A. It occurs due to a sharp appreciation in the value of a currency.
B. It forces authorities to block large volumes of international currency reserves.
C. A country in currency crisis will not be eligible for loans from the International Monetary Fund.
D. It results in the government sharply increasing interest rates to defend the prevailing exchange rate.
E. A country in currency crisis will face sharp decreases in stock and property prices.
115.Which of the following is true of a banking crisis?
A. Individuals and companies withdraw their deposits from banks.
B. It results in a sharp appreciation in the value of the currency.
C. It happens due to a decline in domestic borrowing.
D. It occurs due to asset price deflation.
E. Banks tend to decrease interest rates during a banking crisis.
116.Which of the following statements is true about financial crises?
A. The elements of currency, banking, and debt crises do not present themselves simultaneously.
B. A currency crisis forces authorities to hold large volumes of international currency reserves.
C. A foreign debt crisis occurs when a country’s foreign debt obligations in private-sector government debt cannot be serviced.
D. A banking crisis occurs when individuals and companies increase their deposits due to increasing interest rates.
E. The International Monetary Fund does not grant loans to countries that face the risks of financial crises.
117.Which of the following is a common underlying macroeconomic cause of financial crises?
A. Low relative price inflation rates
B. Narrowing current account deficit
C. Increases in stock and property prices
D. Decline in domestic borrowing
E. Increases in the value of domestic currency
118.Most of the International Monetary Fund’s loan activities since the mid-1970s have been targeted toward developing nations typically because:
A. developed nations are not willing to enact certain macroeconomic policies in return for money.
B. developing nations are more than twice as likely to experience financial crises as developed nations.
C. it does not have enough funds to lend to large and developed countries.
D. only developing nations are allowed to be its beneficiaries.
E. of relatively slow economic growth in the developed countries of Europe.
119.According to the agreement reached between the International Monetary Fund and the South Korean government in 1997, in return for funding, the South Koreans were required to:
A. adopt communist ideologies.
B. reduce their imports by enforcing restrictive import licensing.
C. open their economy to greater foreign competition.
D. oppose the ideologies of the World Trade Organization.
E. engage in competitive currency devaluation.
120.All International Monetary Fund (IMF) loan packages come with conditions attached. Which of the following is prevented due to these policies of the IMF?
A. Trade liberalization
B. Elimination of restrictive import licensing
C. Excessive government spending and debt
D. Privatization of state-owned assets
E. Deregulation of the economy to increase competition
