Current Affairs Quiz

Example Questions From the Test

• 1Market interest rates rise sharply. For an existing conventional bond paying a fixed rate, what generally happens to its market price, assuming other factors remain equal?
  • It falls because newly issued bonds can offer more competitive returns.
  • It rises because its fixed payments become more attractive.
  • It remains fixed because bond prices cannot change after issuance.
  • It automatically becomes equal to the issuing government’s annual budget.
• 2No party wins a legislative majority, so two parties agree on a shared program and divide cabinet posts. What have they formed?
  • A constitutional referendum
  • A caretaker judiciary
  • A presidential veto
  • A coalition government
• 4A country’s nominal GDP grows by 6% in a year while prices across the economy rise by 8%. What is the most reasonable inference?
  • Real output must have grown by exactly 14%.
  • The country must have recorded a trade surplus.
  • The government necessarily collected less tax revenue.
  • After adjusting for inflation, economic output likely declined.