Economic News MCQ Practice Test

Q1. The European Central Bank has implemented a new policy to combat the economic impact of the COVID-19 pandemic. Which of the following is true about this policy?

• A. The European Central Bank has increased interest rates to stimulate economic growth.
• B. The European Central Bank has introduced a negative interest rate policy to encourage borrowing.
• C. The European Central Bank has launched a quantitative easing program to inject liquidity into the economy. ✓
• D. The European Central Bank has imposed capital controls to limit foreign investment.

Q2. Which country is actively exploring or has launched a Central Bank Digital Currency (CBDC)?

• A. China
• B. Turkey ✓
• C. Sri Lanka
• D. United Arab Emirates

Q3. The European Central Bank's Corporate Sector Purchase Programme (CSPP) is a monetary policy tool used to purchase corporate bonds. Which of the following is a characteristic of this program?

• A. It targets bonds from specific Eurozone countries.
• B. It aims to lower borrowing costs for companies in the Eurozone. ✓
• C. It only purchases bonds from companies in Germany.
• D. It is primarily focused on purchasing government bonds.

Q4. The European Central Bank (ECB) has announced a plan to increase the amount of ​​€ in circulation to stimulate the eurozone economy. Which of the following is the primary goal of this move?

• A. To combat rising inflation
• B. To reduce the unemployment rate
• C. To increase the purchasing power of consumers
• D. To encourage businesses to invest in the eurozone ✓

Q5. In response to the Russian invasion of Ukraine, which country has imposed a 35% tariff on Russian oil imports?

• A. Norway
• B. Poland ✓
• C. Finland
• D. Sweden

Q6. The European Union has introduced a new tax on digital services, which will affect companies with revenues of over \u20ac10 million. Which of the following countries is not subject to this tax?

• A. France
• B. Germany
• C. Ireland
• D. Norway ✓

Q7. The European Central Bank has recently implemented a new policy to combat low inflation rates in the Eurozone. Which of the following is a key aspect of this policy?

• A. Negative interest rates on commercial bank reserves ✓
• B. Targeted quantitative easing for small businesses
• C. A 10% increase in the minimum wage for all Eurozone countries
• D. A 5% reduction in corporate tax rates across the Eurozone

Q8. The European Central Bank (ECB) has announced a plan to phase out its asset purchase program, which has been in place since 2015. The ECB has stated that it will reduce the monthly purchases of bonds by £10 billion starting in September. What is the main reason behind the ECB's decision to phase out the asset purchase program?

• A. The ECB wants to reduce its balance sheet and increase interest rates to combat inflation. ✓
• B. The ECB is trying to reduce its dependence on monetary policy and shift to fiscal policy.
• C. The ECB is responding to the improving economic growth in the eurozone and wants to avoid overheating.
• D. The ECB is dealing with a potential credit crisis in the eurozone and wants to increase liquidity.

Q9. Which country has announced a plan to create a sovereign wealth fund to manage its oil revenues and diversify its economy?

• A. Norway
• B. United Arab Emirates ✓
• C. Kuwait
• D. Oman

Q10. In March 2020, the ECB launched the Pandemic Emergency Purchase Programme (PEPP) with an initial size of ___

• A. 750 billion euros ✓
• B. 20 billion euros
• C. 75 million euros
• D. 7.5 trillion euros

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