JAMB Economics Past Questions & Answers - Page 131

651.

A huge national debt is an indication that the gold reserves of a nation has

A. appreciated

A.

Appreciated

B.

Decreased

C.

Depreciated

D.

Stagnated

Correct answer is D

No explanation has been provided for this answer.

652.

An ad valorem tax is imposed on

A.

Special commodities

B.

Exports

C.

Imports

D.

The value of a commodity

Correct answer is D

An ad valorem tax (Latin for "according to value") is a tax whose amount is based on the value of a transaction or of property. It is typically imposed at the time of a transaction, as in the case of a sales tax or value-added tax (VAT)

653.

The major function of money market is to

A.

Provide funds for long-term financing

B.

Provide funds short-term financing

C.

Stabilize the value of the local currency

D.

Stabilize domestic prices

Correct answer is B

Money market is a financial market for sourcing of short term loans. The funds traded on in the money market have a maturity date of 0-3 months

654.

The minimum amount which banks are required to deposit with the central bank is determined by the

A.

Liquidity ratio

B.

Cash reserve ratio

C.

Minimum lending rate

D.

Aggregate credit ceiling

Correct answer is B

Cash Reserve Ratio (CRR) is a certain minimum amount of deposit that the commercial banks have to hold as reserves with the central bank.

655.

The money that commands a higher market value than its face value is called

A.

Paper money

B.

Standard money

C.

Commodity money

D.

Fiat money

Correct answer is D

No explanation has been provided for this answer.