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CIMA BA1 - Fundamentals of Business Economics

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Total 468 questions

The following scatter diagram displays the total life expectancy in years on the X axis and GDP per capita (constant 2000 S) on the Y axis, in Country S for the past 40 years. Which of the following statements is true in respect of the graph?

A.

A perfect positive linear relationship is shown in the diagram.

B.

In most years, the samples shows a clear negative trend in the diagram

C.

There is no correlation between the level of GDP per capita and life expectancy.

D.

In some years, the level of GDP per capita and life expectancy moved in opposite directions.

Which TWO reasons support the argument that global firms may facilitate globalisation?

A.

Global firms can lobby governments to open up markets for free trade

B.

Global firms can bring stability to international stock markets

C.

Global firms can be immune from national concerns

D.

Global firms can forfeit national laws under certain conditions

E.

Global firms can lead to greater homogemsation of tastes and values across different countries.

A business based in Country A. agrees to buy a software package from a company based in Country O tor 20.000 Country O dollars 12 months time. At the time of the contract the exchange rate was 1 O dollar (0$) to 1.5 Country A pounds (A£). When payment ism

Rate is O$1 to A£1 4.

What is the exchange rate gain (+) or loss (-) made by the Country A business?

Give your answer to a whole number.

A forward exchange contract would be appropriate (or a company that

A.

is due to receive a payment denominated in foreign currency today

B.

is due to receive a large payment denominated in foreign currency in five months' time

C.

is worried that its products are becoming less competitive due to a general appreciation of the domestic currency over lime

D.

is expected to pay a substantial amount denominated in national currency to a foreign creditor m six months' time

rson's correlation coefficient between the number of shirts sold per day (x) and the number of jackets sold per day (y), across its eight stores (n=8).

what is the Pearson's correlation coefficient? Give your answer to two decimal places.

A hairdressing salon can either invest in

1. New. more comfortable chairs at a cost of $5,000

2. New shop windows at a cost of $4,000

Over the next five years. Investment 1 will generate an additional amount of profit whose present value is $6,000. while Investment 2 additional amount of profit whose present value is $5,500

What is the net present value of the best project? Give your answer to the nearest whole dollar.

In the short term, if an organisation's income is lower than its expenditure, it is an example of:

A.

financial intermediation

B.

lack of financial synchronisation

C.

why equity capital is needed

D.

financial surplus

Which of the following is correct regarding data?

Data can be recorded as:

(1) numbers.

(2) symbols.

(3) raw facts.

A.

(1)only

B.

(3) only

C.

(1)and

D.

(1),(2)and(3)

Larger companies may benefit from economies of scale due to which THREE of the following?

A.

Larger companies may gain greater market share through advertising

B.

Larger companies may spread their fixed research and development costs over a larger amount of output

C.

Larger companies may more easily access public subsidies

D.

Larger companies may obtain lower interest rates on their loans.

E.

Larger companies may purchase inputs in bulk at lower unit prices

F.

Larger companies may benefit from greater customer loyalty

A manufacturing company is considering a new investment project.

Which TWO of the following would reduce the net present value of the investment to the business?

A.

A rise in the scrap value of the project at the end of its life.

B.

A reduction in the expected level of future sales.

C.

A rise in interest rates.

D.

A fall in the initial capital cost of the project

E.

An expected fall in the future price of components used by the business