Which of the following is an example of foreign portfolio investment ?

A. Toyota builds a new plant in the north of England
B. EDF of France buys shares in Scottish & Southern Energy of the UK, and Scottish & Southern Energy uses the Proceeds to build a new hydro-electric power station in Scotland
C. Deutsche Bank of Germany buys some new software from UK Supplier
D. JCB builds a new plant near Manchester

If Toyota builds a new plant in the north of England ?

A. None of these answers
B. There has been an increase in foreign portfolio investment in the UK
C. Once the plant starts producing cars UK GDP will rise less than UK GNP
D. once the plant starts producing cars UK GDP will rise more than UK GNP

Many East Asian countries are growing very quickly because ?

A. They save and invest an unusually high percentage of their GDP
B. They have always been wealthy and will continue to be wealthy, which is known as the “snowball effect”
C. They are imperialists and have collected wealth from previous victories in war
D. They have enormous natural resources.

If a production function exhibits constant returns to scale ?

A. doubling all of the inputs more than doubles output due to the catch-up effect
B. doubling all of the inputs has absolutely no impact on output because output is constant
C. doubling all of the inputs less than doubles output due to diminishing returns
D. doubling all of the input’s doubles output

Which of the following statements is true ?

A. Countries all have the same growth rate and level of output because any country can obtain the same factors of production
B. Countries have great variance in both the level and growth rate of GDP/person thus poor countries can become relatively rich over time
C. Countries may have different level of GDP/person but they all grow at the same reate
D. Countries may have a different growth rate but they all have the same level of GDP/person

scroll to top