What is a liquidity trap?

A liquidity trap is a situation, described in Keynesian economics, in which, "after the rate of
interest has fallen to a certain level, liquidity preference may become virtually absolute in the
sense that almost everyone prefers holding cash rather than holding a debt which yields so low a
rate of interest."A liquidity trap is when monetary policy becomes ineffective due to
very low interest rates combined with consumers who prefer to save rather
than invest in higher-yielding bonds or other investmentsthe liquidity trap.
Typically, an increase in the money supply (such as the increase generated through
the Federal Reserve's large-scale asset purchases) causes inflation to rise as more
money is chasing the same amount of goods

What is the Keynes theory of economics?

Keynesian economics argues that demand drives supply and that healthy
economies spend or invest more than they save. To create jobs and boost
consumer buying power during a recession, Keynes held that governments should
increase spending, even if it means going into debt.

Economic push factors are factors that force people to migrate; they are negative
conditions such as poverty, environmental degradation, unemployment, low pay, low
standard of living, high taxation, and lack of resources and services.

Economic pull factors are factors that attract people to a specific location. Pull
factors are positive conditions that include employment and career opportunities,
high pay and higher standard of living, low taxation, and abundant resources and
services

Roundaboutness, or roundabout methods of production, is the process whereby

capital goods are produced first and then, with the help of the capital goods,
the desired consumer goods are produced.

Double counting in accounting is an error whereby a transaction is counted more

than once, for whatever reason.

Realized Investment means the amount of gain that the Company makes from
the sale of an asset or Portfolio Investment. It is calculated as the net sales price
received (sales price of the asset less any transaction or closing costs) less the
Company's adjusted tax basis of the asset or Portfolio Investment.

A portfolio investment is ownership of a stock, bond, or other financial asset

with the expectation that it will earn a return or grow in value over time, or
both. It entails passive or hands-off ownership of assets as opposed to direct
investment, which would involve an active management role.

Direct investment, or foreign direct investment, is designed to acquire a

controlling interest in an enterprise. Direct investment provides capital funding in
exchange for an equity interest without the purchase of regular shares of a
company's stock.

Indirect means buying into a property investment without actually buying the
property itself directly. For example, indirect investment might involve purchasing
units in a company or scheme which does own the property investment.
Inventory investment is a component of gross domestic product. What is produced in a certain
country is naturally also sold eventually, but some of the goods produced in a given year may be
sold in a later year rather than in the year they were produced

Planned Saving and Planned Investment: The savings which are planned
(intended) to be made by all the households in the economy during a period
(say, a year) in the beginning of the period is called planned (or ex-ante) savings.

Ex-post savings refers to the actual savings in the economy from the given level
of income during the period of one year. This aspect of savings is considered in
the calculation of National Income

Capital formation means increasing the stock of real capital in a country. In other
words, capital formation involves making of more capital goods such as machines,
tools, factories, transport equipment, materials, electricity, etc., which are all used for
future production of goods.

the two gap model is based on the gap between a country's own provision of
resources and its absorptive capacity. These two gaps are known as the Savings
Gap and the Foreign Exchange Gap.

Input-output analysis (I-O) is a form of macroeconomic analysis based on the

interdependencies between different economic sectors or industries. This
method is commonly used for estimating the impacts of positive or negative
economic shocks and analyzing the ripple effects throughout an economy. which can
be used by governments to analyze economies and make informed policy
decisions. Input-output models also study the effects of direct impact, indirect
impact, and induced impact.

The spot price is the current price in the marketplace at which a given
asset—such as a security, commodity, or currency—can be bought or sold for
immediate delivery.
In economics, a price support may be either a subsidy, a production quota, or a price control,
each with the intended effect of keeping the market price of a good higher than the competitive
equilibrium level.

A shadow price is the monetary value assigned to an abstract or intangible commodity which is
not traded in the marketplace. This often takes the form of an externality. Shadow prices are also
known as the recalculation of known market prices in order to account for the presence of
distortionary market instruments.
The production possibilities curve (PPC) is a graph that shows all of the different
combinations of output that can be produced given current resources and
technology. Sometimes called the production possibilities frontier (PPF)
The CPF, or consumption–possibility frontier, is the budget constraint where participants
in international trade can consume. Under autarky this constraint is identical to the
production–possibility frontier.

The Production Possibilities Frontier (PPF) is a graph that shows all the
different combinations of output of two goods that can be produced using
available resources and technology.
Depreciation allowance means an estimate of the annual cost of using an item
that is based on its acquisition cost divided by its assumed or estimated
useful life. Depreciation allowance means a loss in value expressed in terms of
a percentage of replacement or reproduction cost new.
A crossed cheque is a cheque that has been marked specifying an instruction on the way
it is to be redeemed. A common instruction is for the cheque to be deposited directly to
an account with a bank and not to be immediately cashed by the holder over the bank
counter.
order cheque is a cheque where only the person or party in whose name the
cheque has been drawn, can withdraw the cash. The person collecting the
cheque has to give an identity proof to encash the cheque.
Bearer Cheque. A bearer cheque is the one in which the payment is made to
the person bearing or carrying the cheque. These cheques are transferable by
delivery, that is, if you are carrying the cheque to the bank, you can be issued
the payment to.
A traveller's cheque is a medium of exchange that can be used in place of hard currency.
They can be denominated in one of a number of major world currencies and are
preprinted, fixed-amount cheques
A black market, underground economy, or shadow economy is a clandestine market or
series of transactions that has some aspect of illegality

What is non legal money?

Bills of exchange, bank drafts, postal orders, and cheques are examples of
non-legal tender money. These types of money are usually accepted but legally
there is no obligation to accept them. Whether it is accepted or not is the
choice of lender, seller or creditor.

What is money as a legal tender?

Legal tender is any form of payment recognized by a government, used to pay

debts or financial obligations, such as tax payments. National currencies, such
as the U.S. dollar, are legal tender. In the U.S., the Treasury is authorized to
create and issue dollars to the public.
Token money, or token, is a form of money that has a lesser intrinsic value compared to
its face value. Token money is anything that is accepted as money, not due to its intrinsic
value but instead because of custom or legal enactment. Token money costs less to
produce than its face value
Any future monetary claim against an individual that can be used to buy goods
and services is known as Credit money or bank money. There are many forms
of credit money, such as bonds, money market accounts etc
A money market account is an interest-bearing account that you can open at
banks and credit unions. They are very similar to savings accounts, but they
offer some checking account features as well.
Paper money is a country's currency in the form of bank notes which have a
specific value and are used to pay for goods and services. Paper money holds
the backing of a country's government while the central bank keeps a controls
over the note's printing and circulation.
a certificate of deposit for a specific sum of money in a savings account,
especially a deposit for a fixed term at a specified interest rate.

What is pay order used for?

Pay order is a financial instrument which is issued by the bank on customer's

behalf giving an order to pay a particular amount to a particular person in a
same city
deficit financing, practice in which a government spends more money than it
receives as revenue, the difference being made up by borrowing or minting
new funds.

What is the main objective of deficit financing?

In developing economies the main objective of deficit financing is to remove

the vital issue such as unemployment, poverty and income inequality.
Poverty is said to exist when people lack the means to satisfy their basic
needs.Absolute poverty is when household income is below a certain level.
This makes it impossible for the person or family to meet basic needs of life
including food, shelter, safe drinking water, education, healthcare, etc
.Relative poverty is when households receive 50% less than average
household incomes. So they do have some money but still not enough money
to afford anything above the basics. This type of poverty is, on the other hand,
changeable depending on the economic growth of the country.
Generational poverty is a term applied to families who have experienced
poverty for at least two generations. It can affect every aspect of a person's
life: physical, social, emotional and mental.
Pump priming is the action taken to stimulate an economy, usually during a
recessionary period, through government spending and interest rate and tax
reductions. The term pump priming is derived from the operation of older
pumps - a suction valve had to be primed with water so that the pump would
function properly.
Trickle-down economics, or “trickle-down theory,” states that tax breaks and
benefits for corporations and the wealthy will trickle down to everyone else. It
argues for income and capital gains tax breaks or other financial benefits to
large businesses, investors, and entrepreneurs to stimulate economic growth.
An assembly line is a production process that breaks the manufacture of a
good into steps that are completed in a pre-defined sequence. Assembly lines
are the most commonly used method in the mass production of products.
They reduce labor costs because unskilled workers are trained to perform
specific tasks.
The breakeven point is the level of production at which the costs of production
equal the revenues for a product. In investing, the breakeven point is said to
be achieved when the market price of an asset is the same as its original cost.

Question 1. What Is Managerial Economics?

Answer :
Economics is a social science, which studies human behavior in relation to
optimizing allocation of available resources to achieve the given ends.
The application of economic science is all pervasive. More specifically economic
laws and tools of economic analysis are applied a great deal in the progress of
business decision making. This has led to the emergence of a separate branch of
study called Managerial Economics.
Managerial Economics is the study of economics theories, logic and tools of
economic analysis that are used in the process of business decision making.
Economic theory and technique of economic analysis are applied to analyse
business problems, evaluate business options and opportunities with a view to
arriving at appropriate business decision. Managerial economic is thus constituted
as that part of economic knowledge, logic, theories and analytical tools that are
used for rational business decision making .

Question 2. What Is Managerial Economics? What Is Its Relevance To

Engineers/managers?
Answer :
Study of economic theories, logic and methodology for solving the practical
problems of business. It is used to analyze business problems for rational business
decisions. It is also called as Business Economics or Economics for firms.
Relevance to engineers/Managers:
Engineering and Management involves a lot of strategic decision making
situations. Managerial economics helps in rational decision making. The various
economic concepts help a manger to take right decisions. The scope of managerial
economics is:

○ The selection of the production or the service to be produced.

○ The choice of production methods and resource combinations.
○ The choice of best price and quantity combinations.
 ○ Promotional strategy and activities.
○ The selection of location from which to produce.

Accounts and Finance for Managers Interview Questions

Question 3. What Are The Basic Economical Concepts?
Answer :
The basic/fundamental economic concepts are:

○ Incremental concept
○ Discounting concept
○ Time perspective
○ Opportunity cost
○ Equimarginal concept.

Question 4. What Is Micro And Macro Economics?

Answer :
The study of economics is divided into two parts.

○ Micro Economics
○ Macro Economics

Micro economics:

○ The word micro means a millionth part. Microeconomics is the study of

the small part or component of the whole economy that we are
analyzing. For example we may be studying an individual firm or in any
particular industry. In Microeconomics we study of the price of the
particular product or particular factor of the production.
○ theory studies the behavior of individual decision-making units such
as consumers, recourse owners and business firms.

Macro Economics

○ Macro economics is the study of behavior of the economy as a whole.

It examines the overall level of nations out put, employment, price and
foreign trade.
○ Macroeconomics is concerned with aggregate and average of entire
economy.
Accounts and Finance for Managers Tutorial
Question 5. What Are The Differences Between Micro Economics And Macro
Economics?
Answer :
MICRO ECONOMICS

○ Micro economics is the study of small part of component of the whole

economy.
○ Micro economics is called the price theory. It’s explained its
composition, or allocation of total production why more of something is
produced than of others.
○ In Micro study about individual consumer behavior or individuals firm
or what happens in any particular industry.
○ If it be an analysis of price, we study about the price of a particular
producer or of a particular factor of production.
○ If it is demand we analysis demand of an individual or that of an
industry.
○ Here we study the income of an individual.

MACRO ECONOMICS

○ Macro economics is the study and analysis of economic system as a

whole.
○ Macro economics is called income theory. It explains the level of total
production and why the level rises and fall.
○ In Macro we study how the aggregates and the averages of the
economy as whole is determined and what causes fluctuation in them.
○ In macro we study the general price level in country.
○ In macro we study the aggregate demand of the entire country.
○ Here we study the national income of the country.

Corporate Governance and Business Ethics Interview Questions

Question 6. State Law Of Demand ?
Answer :
law of demand basically says when the price of a certain product goes up,quantity
demanded of that product goes down. when price goes down, quantity demanded
goes up.

Question 7. What Does Perfect Competition Mean?

Answer :
Perfect competition is basically an economic model that helps to describe a
hypothetical market form. In this form the producer or the consumer does have any
kind of market authority in order to make changes in prices.

Corporate Governance and Business Ethics Tutorial Business Management

Interview Questions
Question 8. What Is A Demand Forecast?
Answer :
A demand forecast is the prediction of what will happen to your company's existing
product sales. It would be best to determine the demand forecast using a
multi-functional approach. The inputs from sales and marketing, finance, and
production should be considered. The final demand forecast is the consensus of all
participating managers. You may also want to put up a Sales and Operations
Planning group composed of representatives from the different departments that
will be tasked to prepare the demand forecast.

Question 9. What Is Equilibrium Of The Firm And Industry ?

Answer :
According to Miller, “Firm is an organisation that buys and hires resources and sells
goods and services”. Lipsey has defined as “firm is the unit that employs factors of
production to produce commodities that it sells to other firms, to households, or to
the government.”

Bid Evaluation Interview Questions

Question 10. Explain Factors Influencing Managerial Decision ?
Answer :
Critical managerial decision making is the key to superior performance at work.
One has to refer to critical Data, past records and performance metrics and analysis
before making decisions.

Statistics Tutorial
Question 11. How Will You Arrive At A Business Decision? What Is A Business
Environment?
Answer :
Managerial Decisions/ Decision Analysis is the Process of selecting the best out of
alternative opportunities, open to the firm.
To arrive at a business decision, the four main phases are:

○ Determine and define the objective.

○ Collection of information regarding economic, social, political and
technological environment and foreseeing the necessity and occasion for
decision.
○ Inventing, developing and analyzing possible courses of action.
 ○ Selecting a particular course of action from the available alternatives.

Business environment comprises of the economic, social, political and

technological environment.

Human Physiology Interview Questions

Question 12. What Are Firms?
Answer :
Firm is an organization owned by one or jointly by a few or many people, engaged in
a productive activity, with a definite aim.

Accounts and Finance for Managers Interview Questions

Question 13. What Are The Factors Of Production?
Answer :
There are three types of factor of production.

○ Land.
○ Labor
○ Capital.

Managing the Manager Tutorial

Question 14. What Are The Main Techniques Of Demand Estimation?
Answer :
Demand estimation is predicting future demand form a product. The information
regarding future demand is essential for planning and scheduling production,
purchase of raw materials, acquision of finance and advertising.
The various techniques of demand estimation:

○ Survey Method
○ Statistical Method.

Question 15. What Is The Significance Of Foreign Exchange Rate Risk And How Can
This Risk Be Mitigated?
Answer :
Foreign exchange risk is also known as hedging. Those people who are risk averse
follow this kind of transaction to save firm from unexpected loses. Since exchange
rate can change in either way i.e. it can depreciate or appreciate, company can gain
at the same time but to mitigate loses they engage into forward contracts.

Statistics Interview Questions

Question 16. What Is Pricing Of Factors Of Production?
Answer :
Whenever we have touched on the pricing of productive factors, we have signified
the prices of their unit services, i.e., their rents. In order to set aside consideration
of the pricing of the factors as "wholes," as embodiments of a series of future unit
services, we have been assuming that no businessmen purchase factors (whether
land, labor, or capital goods) outright, but only unit services of these factors. This
assumption will be continued for the time being. Later on, we shall drop this
restrictive assumption and consider the pricing of "whole factors."

Question 17. What Are The Types Of Market Economies?

Answer :
There are 4 main types of market economies. They are also known as Economic
Systems. They are

○ Free Market,
○ Mixed Market,
○ Command and
○ Traditional Economy.

Political science Interview Questions

Question 18. What Is The Importance Of Microeconomics In Study Of Managerial
Economics?
Answer :
It’s a economics for decision making where we have to be very optimize and
implement those situation which will be helpful in profit maximization in our
business effectively and efficiently.
Since the microeconomics explains the concepts like demand, production, supply
analysis, so that it maximizes the profit.

Corporate Governance and Business Ethics Interview Questions

Question 19. What Is The Difference Between Project Proposal And Project
Feasibility Study?
Answer :
Project feasibility study is required to make a decision whether the project proposal
is technically and economically feasible. After finalization of the project feasibility
report by the experts (technical & economical), the decision for going ahead for
preparation of Detailed Project Report (DPR) for the project proposal.

Question 20. Why Does An Indifference Curve Never Meet?

Answer :
No indifference curve can intersect because all points on indifference curve are
ranked equally preferred and ranked either or less more preferred than every other
point on the curve.
Business Development Manager Interview Questions
Question 21. What Is Full Employment Gdp?
Answer :
The market value of all final goods and services produced at full employment.
There is no more resources to be deployed. At this stage if there is further
expansion of output, then it will lead to inflation.

Question 22. What Is The Importance Of Strategic Management Towards The

Success Of A Business?
Answer :
Strategic management used to play a different after the Second World War.
Strategic plans of the past usually range 3 to 5 years. Some companies could even
have plans for 10 good years. That is not possible today given rapid evolution of our
society.

Question 23. What Are The Functions Of Price Mechanism In A Free Market
Economy?
Answer :
Price Mechanism

○ Price mechanism is the point, which equilibrates supply and demand

within a market. It is a mechanism of pricing. The price mechanism is
one, which allows the prices of goods and services to be decided by the
interplay between supply and demand. There is no centralized price
fixing.
○ The price mechanism is the concept that the free market, when left to
its own devices, will formulate fair prices of the goods or services on
its own by the natural laws of supply and demand.

Managing the Manager Interview Questions

Question 24. What Is Social Cost Benefit Analysis?
Answer :

○ It refers to the study of feasibility of a project in terms of its total

economic cost and total economic benefits.
○ it means to compare total cost will total benefit if we add external cost
with private cost, it’s called total social cost if we add external benefit
with private benefit, called total social benefit.

Business Management Interview Questions

Question 25. What Is Collateral Management?
Answer :
Collateral Management is a function to manage collateral effectively. It provides
interface to enter collateral data, and it has a master data of collateral descriptions
and types. It maintains customer, collateral, and credit account relationships so the
amount of idle collateral can be determined. It is usually packaged in an application
or part of the core-banking application.

Question 26. How Do Tax Cuts Affect The Economy?

Answer :
Tax cuts improve the economy by giving the people more spending power and
higher consumer confidence, which leads to them spending more of all of their
income which leads to more jobs, more business investment in more efficient
technologies, and ultimately higher GDP growth.

Question 27. What Is Meant By The Term National Debt?

Answer :
When a government spends more than it receives in taxes, it runs a budget deficit,
which is usually covered by issuing debt obligations to domestic and/or
international investors. In the US, these obligations are Treasury bills, Treasury
notes, and Treasury bonds. The total outstanding amount of such obligations
constitutes a National Debt.

Bid Evaluation Interview Questions

Question 28. What Is Pps?
Answer :
Packets per second (pps) are a measure of throughput for network devices such as
bridges, routers, and switches. It is a reliable measurement only if all packet sizes
are the same. Vendors will often rate their equipment based on pps, but make sure
comparisons are made using the same packet sizes.

Question 29. What Is Universal Banking?

Answer :
It generally refers to the combination of commercial banking and investment
banking. It is a supermarket for both wholesaler and retailer financial services as it
offers a wide range of financial services.

Question 30. What Are The Advantage Of Capitalism?

Answer :
The advantage of capitalism is that the governments have limited control over other
business.
Question 31. What Does Macroeconomics Mean?
Answer :
The study of the overall aspects and workings of a national economy is such as
income, output, and the interrelationship among diverse economic sectors. It is the
study of all aspects of the economy. It is different from microeconomics, which
studies how individual entities (such as people, families, or even corporations) fit in
the economy.

Question 32. How Does Outsourcing Affect The Economy?

Answer :
In principle, outsourcing makes things a little cheaper and increase profitability.
However, some things need to be done 'in house'. For example, some employers
(largely) outsource recruitment to key posts. The people making the decisions may
be good at picking bright people, but they often do not really know what is needed
by the employer. In Britain, it often said that corporations 'hire people who are good
at getting jobs but bad at doing them'. To the extent that this is true, it is damaging
for all concerned.

Question 33. How Do You Explain Gni Per Capita?

Answer :
A measure of the wealth is earned by nations through economic activates all
around the world.
Gross National Income comprises the total value of goods and services produced
within a country (i.e. its Gross Domestic Product), together with its income received
from other countries (notably interest and dividends), and less similar payments
made to other countries. It is also known as GNP.
It can be calculated as follows:
GNI = Gross Domestic Product + Net property income from abroad.

Human Physiology Interview Questions

Question 34. What Is The Difference Between Service Industry And Industry In
Economy?
Answer :
Industry is a generic term, but is most commonly used as a substitute term for a
manufacturer of goods such as Pepsi or Ford. The term industry can also be used
to refer to a very specific group of companies.
The service industry is essentially non-good producing industries such as retail
trade, wholesale trade, and the service industries. According to the U.S. Census
Bureau, these companies make up 70% of the total economic activity in the United
States. Good examples of the service industry include health care, hospitality &
accommodations, and real estate. The financial and insurance sectors would also
be included within the service industry.
Question 35. What Is Profitability Analysis?
Answer :
This is an analysis of costs and revenue to determine whether a venture will make a
profit. This is important information in deciding on whether to make an investment.
The length of time required to repay the initial investment can be a critical factor.

Question 36. What Is A Tariff?

Answer :
A tariff is nothing but the tax on goods leaving or entering some place.

Statistics Interview Questions

Question 37. What Is Bop?
Answer :
It is called as Balance of payments - an economic term. (BOP) measures the
payments that flow between any individual country and all other countries. It is
used to summarize all international economic transactions for that country during a
specific time, usually a year. The BOP is determined by the country's exports and
imports of goods, services, and financial capital, as well as financial transfers. It
reflects all payments and liabilities to foreigners (debits) and all payments and
obligations received from foreigners (credits).

Question 38. What Is The Incidence Of Tax?

Answer :
tax incidence refers to who actually pays the tax.
Tax incidence can be divided into:

○ Formal incidence: the party liable to the tax.

○ Informal incidence: party, who actually pays the tax.

The tax incidence is decided by the elasticity of demand and supply for a good or
service.

Question 39. Which Is A Better Measure Of Economic Well-being Real Gdp Or

Nominal Gdp?
Answer :
Well real GDP takes into account the inflation rate and thus is more accurate at
recording the actual increase in production activities. Therefore, Real GDP is better.

Question 40. What Is The Difference Between An Economic Luxury And An

Economic Necessity?
Answer :
An economic luxury is wasting land on pools huge garden, etc. An economic
necessity is what you need a certain amount of space (houses) to make something
very necessary (to live in).

Political science Interview Questions

Question 41. How To Find The Marginal Cost Of A Product?
Answer :
In economics and finance, marginal cost is the change in total cost that arises when
the quantity produced changes by one unit. That is, it is the cost of producing one
more unit of a good. Mathematically, the marginal cost (MC) function is expressed
as the first (order) derivative of the total cost (TC) function with respect to quantity
(Q).

Question 42. What Is The Marginal Cost Of Capital?

Answer :
Marginal or incremental cost of capital is cost of the additional capital raised in a
given period.

Business Development Manager Interview Questions

Question 43. What Is Consumer Demand?
Answer :
Consumer Demand is how much of something that consumers are wanting. A
company needs to know the consumer demand so they know how much of a
product to make.

Question 44. What Are The Advantages Of Free Market Economy?

Answer :
There are many advantages to a free market economy. They range from the moral
issues to the practical issues. We will deal mainly with the practical ones.
Unprecedented innovation - Free markets are wrought with inventions and the
capital to research them. Countries classified as having a free market have been
responsible for the vast majority of inventions since the 19th century.
Very high-income mobility - This means that under a free market system it is easier
to move around income brackets. It is just easier to become rich or poor when you
are left to your own devices as opposed to a controlled economy where resources
are allocated by the government.

Question 45. What Is A Retention Bonus?

Answer :
A Retention bonus is an incentive paid to a key employee to retain them through a
critical business cycle. This could be a transitional period (such as mergers and
acquisitions) to ensure productivity or to meet a critical milestone. It has proven to
be a very good tool in persuading employees to stay.
Question 46. What Is Ramsay Pricing?
Answer :
It assigns costs based on the price elasticity of demand. At higher the elasticity
(elastic), the lower the charge of fixed costs when allocated amongst products.

Question 47. How Do Reductions In Government Spending Affect The Economy?

Answer :
Generally the government is very good at wasting money and resources so less
spending, by the government helps the economy as those resources are allocated
in areas that are more efficient.

Question 48. What Perfect Competitive Market And Pure Monopoly Market Have In
Common?
Answer :
A perfect competitive market and pure monopoly market both have to follow the
"law of demand".

Question 49. How Do You Define A Control In Economics?

Answer :
A control in economics means a steady profit rate that is increasing.

Question 50. What Is Price Level?

Answer :
The price level refers to the monetary value of a good or service.

Question 51. What Are Financial Centers?

Answer :
Banks and brokerage firms are considered financial centers.

Question 52. What Is Explanatory Research?

Answer :
Explanatory research is research conducted in order to explain any behavior in the
market. It could be done through using questionnaires, group discussions,
interviews, random sampling, etc.

Question 53. What Is The Advantage Of Mixed Economy System?

Answer :
Advantages are:

○ People can make their own decisions.

○ The government has limited control, which is good for structure.
 ○ Provides freedoms such as Enterprise, ownership, Social Welfare, Profit
Earnings, Political Freedom.
○ All national resources are utilized under mixed economy.
○ It will activate the government support and direction.

Question 54. What Is An Opportunity Cost?

Answer :
Opportunity cost is cost of an alternative that must be forgone in order to pursue a
certain action. Put another way, the benefits you could have received by taking an
alternative action. Concept of opportunity cost is central to economics because it
reminds us that every day we each have choices to make and for each choice, that
we make there is a second best option that we forego {that we pass up}.

Question 55. What Is An Oligopoly?

Answer :
Oligopoly is a market where the supply is controlled by a small group of companies.
In this condition, the actions of one company will have a material effect on the
entire market for a product.
Several characteristics of an Oligopoly:

○ Substantial barriers to entry.

○ Market dominated by a few large firms.
○ Differentiated products.
○ Price rigidity.

Question 56. What Is Privatization?

Answer :
Privatization is the transfer of ownership from the public sector (government) to the
private sector (business).

Question 57. Why Do Prices Tend To Up?

Answer :
Prices tend to move up mainly due to increase in the supply of money, demand and
cost of production.

Question 58. What Is Meaning Of Market Economy?

Answer :
The meaning of a market economy is in which the decision and production are
made. The consumption of goods services are based on voluntary exchange in
markets.
● uestion 1. What Is Bayesian?
Answer :
Bayesians condition on the data actually observed and consider the
probability distribution on the hypotheses.
● Question 2. What Is Frequentist?
Answer :
Frequentists condition on a hypothesis of choice and consider the
probability distribution on the data, whether observed or not.
● Time Management Interview Questions
Question 3. What Is Likelihood?
Answer :
The probability of some observed outcomes given a set of parameter
values is regarded as the likelihood of the set of parameter values given
the observed outcomes.
● Question 4. What Is P-value?
Answer :
In statistical significance testing, the p-value is the probability of
obtaining a test statistic at least as extreme as the one that was actually
observed, assuming that the null hypothesis is true. If the p-value is less
than 0.05 or 0.01, corresponding respectively to a 5% or 1% chance of
rejecting the null hypothesis when it is true.
● Managerial Economics Tutorial
Question 5. Give An Example Of P-value?
Answer :
Suppose that the experimental results show the coin turning up heads 14
times out of 20 total flips

○ null hypothesis (H0): fair coin;

○ observation O: 14 heads out of 20 flips; and
○ p-value of observation O given H0 = Prob(≥ 14 heads or ≥ 14
tails) = 0.115.
● The calculated p-value exceeds 0.05, so the observation is consistent
with the null hypothesis - that the observed result of 14 heads out of 20
flips can be ascribed to chance alone - as it falls within the range of what
would happen 95% of the time were this in fact the case. In our example,
we fail to reject the null hypothesis at the 5% level. Although the coin did
not fall evenly, the deviation from expected outcome is small enough to
be reported as being "not statistically significant at the 5% level".
● Managerial Economics Interview Questions
Question 6. What Is Sampling?
Answer :
Sampling is that part of statistical practice concerned with the selection
 of an unbiased or random subset of individual observations within a
population of individuals intended to yield some knowledge about the
population of concern.
● Question 7. What Are Sampling Methods?
Answer :
There are four sampling methods:

○ Simple Random (purely random),

○ Systematic( every kth member of population),
○ Cluster (population divided into groups or clusters)
○ Stratified (divided by exclusive groups or strata, sample from
each group) samplings.
● Sales Forecasting Tutorial Bid Evaluation Interview Questions
Question 8. What Is Mode?
Answer :
The mode of a data sample is the element that occurs most often in the
collection.
x=[1 2 3 3 3 4 4]
mode(x) % return 3, happen most.
● Question 9. What Is Median?
Answer :
Median is described as the numeric value separating the higher half of a
sample, a population, or a probability distribution, from the lower half.
The median of a finite list of numbers can be found by arranging all the
observations from lowest value to highest value and picking the middle
one
median(x) % return 3.
● Economic Development Interview Questions
Question 10. What Is Quartile?
Answer :

○ second quartile (50th percentile) .

○ third quartile (75th percentile) .
○ kth percentile.
○ prctile(x, 25) % 25th percentile, return 2.25.
○ prctile(x, 50) % 50th percentile, return 3, i.e. median.
● Question 11. What Is Skewness?
Answer :
Skewness is a measure of the asymmetry of the data around the sample
mean. If skewness is negative, the data are spread out more to the left of
the mean than to the right. If skewness is positive, the data are spread out
more to the right.
Skewness(x) % return-0.5954
● Actuarial Interview Questions
Question 12. What Is Variance?
Answer :
variance describes how far values lie from the mean.
var(x) %return 1.1429
● Time Management Interview Questions
Question 13. What Is Kurtosis?
Answer :
Kurtosis is a measure of how outlier-prone a distribution is.
kurtosis(x) % return2.3594
● Question 14. What Is Moment?
Answer :
Quantitative measure of the shape of a set of points.
moment(x, 2); %return second moment
● Question 15. What Is Covariance?
Answer :
Measure of how much two variables change together.
y2=[1 3 4 5 6 7 8]
cov(x,y2) %return 2*2 matrix, diagonal represents variance.
● Content Writer Interview Questions
Question 16. What Is One Sample T-test?
Answer :
T-test is any statistical hypothesis test in which the test statistic follows a
Student's t distribution if the null hypothesis is supported.
[h,p,ci] = ttest(y2,0)% return 1 0.0018 ci =2.6280 7.0863
● Question 17. What Is Alternative Hypothesis?
Answer :
The Alternative hypothesis (denoted by H1 ) is the statement that must be
true if the null hypothesis is false.
● Sales Forecasting Interview Questions
Question 18. What Is Significance Level?
Answer :
The probability of rejecting the null hypothesis when it is called the
significance level α , and very common choices are α = 0.05 and α = 0.01.
● Managerial Economics Interview Questions
Question 19. Give Example Of Central Limit Theorem?
Answer :
Given that the population of men has normally distributed weights, with a
mean of 173 lb and a standard deviation of 30 lb, find the probability that
a. if 1 man is randomly selected, his weight is greater than 180 lb.
b. if 36 different men are randomly selected, their mean weight is greater
that 180 lb.
 Solution: a) z = (x - μ)/ σ = (180-173)/30 = 0.23
For normal distribution P(Z>0.23) = 0.4090
b) σ x̄ = σ/√n = 20/√ 36 = 5
z= (180-173)/5 = 1.40
P(Z>1.4) = 0.0808
● Question 20. What Is Binomial Probability Formula?
Answer :
P(x)= p x q n-x n!/[(n-x)!x!]
where n = number of trials.
x = number of successes among n trials.
p = probability of success in any one trial.
q = 1 -p.
● Workforce Management Interview Questions
Question 21. Do You Know What Is Binary Search?
Answer :
For binary search, the array should be arranged in ascending or
descending order. In each step, the algorithm compares the search key
value with the key value of the middle element of the array. If the keys
match, then a matching element has been found and its index, or position,
is returned. Otherwise, if the search key is less than the middle element's
key, then the algorithm repeats its action on the sub-array to the left of
the middle element or, if the search key is greater, on the sub-array to the
right.
● Question 22. Explain Hash Table?
Answer :
A hash table is a data structure used to implement an associative array, a
structure that can map keys to values. A hash table uses a hash function
to compute an index into an array of buckets or slots, from which the
correct value can be found.
● Question 23. Explain Central Limit Theorem?
Answer :
As the sample size increases, the sampling distribution of sample means
approaches a normal distribution.
If all possible random samples of size n are selected from a population
with mean μ and standard deviation σ, the mean of the sample means is
denoted by μ x̄ , so,
μ x̄ = μ
the standard deviation of the sample means is:
σ x̄ = σ⁄√ n
● Static Timing Analysis Interview Questions
Question 24. What Is Null Hypothesis?
Answer :
 The null hypothesis (denote by H0 ) is a statement about the value of a
population parameter (such as mean), and it must contain the condition
of equality and must be written with the symbol =, ≤, or ≤.
● Bid Evaluation Interview Questions
Question 25. What Is Linear Regression?
Answer :
Modeling the relationship between a scalar variable y and one or more
variables denoted X. In linear regression, models of the unknown
parameters are estimated from the data using linear functions.
polyfit( x,y2,1) %return 2.1667 -1.3333, i.e 2.1667x-1.3333
● Question 26. When You Are Creating A Statistical Model How Do You
Prevent Over-fitting?
Answer :
Over-fitting can be prevented by cross-validation.
● Question 27. What Is Descriptive Statistics?
Answer :
We study in descriptive statistics the methods for organizing, displaying,
and describing data.
● Economic Development Interview Questions
Question 28. What Is A Sample?
Answer :
When data are collected in a statistical study for only a portion or subset
of all elements of interest we are using a Sample.
● Question 29. Give An Example Of Inferential Statistics?
Answer :
Example of Inferential Statistic :
You asked five of your classmates about their height. On the basis of this
information, you stated that the average height of all students in your
university or college is 67 inches.
● Question 30. A Normal Population Distribution Is Needed For The Which
Of The Statistical Tests:
Answer :

○ variance estimation.
○ standard error of the mean.
○ Student's t-test.
● Type of Tax
● Consumption Tax
● A consumption tax is a tax on the money people spend, not the money
people earn. Sales taxes, which state and local governments use to
raise revenue, are a type of consumption tax. An excise tax on a specific
good, such as alcohol or gasoline, is another example of a consumption
 tax. Some economists and presidential candidates have proposed a
federal consumption tax for the U.S. that could offset or replace taxes
on capital gains and dividends.
● Progressive Tax
● This is a tax that is higher for taxpayers with more money. In a
progressive tax system like the U.S. federal income tax, wealthy
individuals pay tax at a higher rate than less wealthy individuals. This is
why wealthy Americans are taxed more than middle-class Americans
and middle-class Americans are taxed at a higher rate than
working-class Americans.
● Regressive Tax
● A regressive tax is one that is not progressive. This could either mean
that the tax is lower for wealthy individuals or that the tax is flat
(everyone pays the same rate). Why is a flat tax regressive? People with
lower incomes would feel the effect of a flat tax more strongly than
people with higher incomes. To a multi-millionaire, a 15% tax wouldn’t
translate to a substantial decrease in quality of life. To someone making
$30,000 a year, a 15% tax would mean a serious dent in spending power.
● Proportional Tax
● A proportional tax is the same as a flat tax. Taxpayers at all income
levels would pay the same “proportion” in taxes. As explained above,
proportional taxes are regressive taxes. These types of taxes are
common in state-level sales taxes but not common at the federal level.
Anyone who remembers the 2012 presidential campaign will remember a
famous proportional tax proposal, the 9-9-9 Plan. That plan was for a 9%
business transaction tax, a 9% personal income tax and a 9% federal
sales tax.
● VAT or Ad Valorem Tax
● The VAT tax is big in Europe but the U.S. has yet to adopt it. It’s a tax on
the “added value” of a product, the difference between the sales price
and the cost of producing a good or service. It’s a form of consumption
tax that buyers pay when they make a purchase, similar to a sales tax.
● So what’s the difference between sales tax and VAT? Sales tax is paid by
the purchaser of a product. Only that final stage in the product’s life is
subject to taxation. VAT, in contrast, is applied at each stage of the
supply chain and then snowballed into the final purchase price. If you
travel to a country with VAT you probably won’t notice you’re paying it
because it is included in the prices you pay. Sales tax, on the other
hand, is listed separately on receipts.
● Property Tax
● Property taxes are taxes you pay on homes, land or commercial real
estate. If you’re deciding whether you can afford to buy a home, you
 should take property taxes into account. Unlike a mortgage, property tax
payments don’t amortize. You have to keep paying them for as long as
you live in a home – unless you qualify for property tax exemptions for
seniors, veterans or disabled residents.
● Capital Gains Taxes
● Capital gains taxes apply to investment income after an investment is
sold and a capital gain is realized. Because so many Americans don’t
invest at all, they don’t pay capital gains taxes. There are also taxes on
dividends and interests stemming from simple interest from a bank
account or dividends and earnings from investments.
● Inheritance/Estate Taxes
● Estate and inheritance taxes are paid after someone dies. An estate tax
is paid from the net worth of the deceased. It’s a tax on the privilege of
passing on assets to heirs. There is a federal estate tax, and some
states levy their own estate taxes as well. Inheritance taxes don’t exist at
the federal level and are only law in a handful of states. They’re taxes on
the privilege of inheriting assets, and so are paid by the heir, not the
estate of the deceased.
● Payroll Taxes
● If you take your annual salary and divide it by the number of times you
get paid each year, chances are that number is higher than your actual
paycheck. One reason could be that your healthcare premiums or 401(k)
contributions are deducted from your paycheck. Another reason is
payroll taxes. These taxes cover your contributions to Medicare, Social
Security, disability and survivor benefits and to federal unemployment
benefits. You’ll also have federal (and maybe state and local) income
taxes withheld from your paycheck. You can learn all about payroll taxes
here.
● Income Taxes
● Income taxes do what the name implies. They tax the income you earn.
Federal income taxes are both progressive and marginal. Marginal
means that there are different tax rates for different income brackets.
The top earners pay a high tax rate, but only on the amount of money
they have in that top bracket.
● So if you’re paying taxes for 2022 and you have $50,000 of taxable
income, you will pay 10% on the first $10,275, 12% on your income
between $10,275 and $41,775 and then you will pay 22% on income
between $41,775 and $50,000. Since the highest income bracket for you
has a rate of 22%, you would say that you’re in the 22% bracket.
However, that doesn’t mean the government taxes all your income at
22%, as tax rates in the U.S. are marginal.
● Bottom Line
● There are many types of taxes in the U.S., and because taxes are here to
stay, it’s nice to understand exactly the different types work. If paying
taxes is a consistent source of stress for you, you may want to change
your approach. That could mean starting earlier, using different tax
preparation software or enlisting professional help, like a financial
advisor with tax expertise.
●