IMC Economics and Accounting

Question 1

In the UK economy, what does Gross Domestic Product (GDP) measure?

Accepted Answer

The total value of all goods and services produced within the UK over a specific period

Answer

The total value of UK exports minus imports

Answer

The total income earned by UK residents abroad

Answer

The total government spending in a fiscal year

Question 2

Which of the following best describes the concept of 'opportunity cost' in economics?

Accepted Answer

The value of the next best alternative foregone when making a choice

Answer

The cost of producing one additional unit of a good

Answer

The total cost of all inputs used in production

Answer

The difference between fixed and variable costs

Question 3

A company reports revenue of £5 million and cost of goods sold of £3 million. What is its gross profit margin?

Accepted Answer

40%

Answer

60%

Answer

166%

Answer

30%

Question 4

Under International Financial Reporting Standards (IFRS), which principle requires that expenses are recognised in the same period as the revenues they help generate?

Accepted Answer

The matching principle

Answer

The prudence concept

Answer

The going concern assumption

Answer

The materiality principle

Question 5

If the Bank of England raises the base interest rate, what is the most likely immediate effect on the gilt market?

Accepted Answer

Gilt prices fall and yields rise

Answer

Gilt prices rise and yields fall

Answer

Gilt prices and yields both rise

Answer

There is no effect on gilts

Question 6

Which of the following is classified as a current liability on a balance sheet?

Accepted Answer

Trade payables due within 30 days

Answer

A 10-year corporate bond issued by the company

Answer

Retained earnings

Answer

Property, plant and equipment