JAMB Economics Past Questions & Answers - Page 47

231.

A contractionary monetary policy is used to control_________

A.

Deflation

B.

Inflation

C.

Recession

D.

Balance of Payment deficit

Correct answer is B

A contractionary monetary policy leads to a balance of payment surplus and there is increase in interest rate or cash reserve ratio thereby reducing investment and output. It is used to control inflation, to stabilise the price level exchange rate and achieve equilibrium in the balance of payment and also promote economy development.

232.

The term "Money at call and short notice" in a bank's assets represents the bank's loans to_____

A.

Industry and commerce

B.

Overseas central banks

C.

The capital market

D.

The money markets

Correct answer is D

Money at call or at short notice is a loan that is made for a very short period for a few days only for duration of a week. Money market is a market for short-term loans.

233.

The term M \(^3\) comprises M \(^1\) together with deposits on deposit account held by

A.

Banks only

B.

Discount houses only

C.

Banks and discount houses

D.

Banks, discount houses and stock, exchanges

Correct answer is C

No explanation has been provided for this answer.

234.

The following are measures of location except_______

A.

Arithmetic mean

B.

Harmonic mean

C.

Range

D.

Geometric mean

Correct answer is C

The measure of central tendency also known as measure of location are = mean (Arithmetic mean), median, mode, geometric mean and Harmonic mean.

235.