BANKS OF QUESTIONS

UNIT 6 MONEY AND BANKING

Questions Answers
1. What is a deposit? A deposit is a sum of money which is in a bank account
or savings account, especially a sum which will be left
there for some time.
2. What is a demand deposit? A demand deposit is a bank deposit from which
withdrawals may be made without notice.
3. What is a time deposit? A time deposit is a bank deposit from which withdrawals
may be made only after advance notice or at a specified
future date/ to earn interest for a fixed period of time:
4. What is a NOW account? A NOW account, known as negotiable order of
withdrawal account, is an interest-earning bank account
whereby the owner may write drafts against the money
held on deposit.

5. What is a share draft account? A share-draft account is a version of a checking account,

6. What does the central bank do specifically when it
functions as the government’s banker?
7. What does the central bank do specifically when it
functions the banker of the banking system?
except it is offered by a credit union instead of a bank.
As banker to the government, the central bank collects
and disburses government income, manages the issues
and redemption of government debts, advises the
government on all matters pertaining to financial
activities, and makes loans to the government.
As the banker of the banking system, the central bank
holds and transfers bank’s deposits, supervises their
operations, acts as a lender of last resort and provides

1

8. What are functions of commercial banks?
9. What are functions of insurance companies?
10. What does a nation’s money supply include?
11. How can commercial banks make/ earn profits?
12. How can an insurance company act as a financial
intermediary?
MONEY & ITS FUNCTIONS
13. What is a medium of exchange?
technical and advisory services.
Functions of commercial banks are to create money in
circulation in saving banks and share-drafts in credit
unions; to maintain and create demand deposits by loans
and investments.
The main functions of insurance companies are to allow
people to pool their resources in order to minimize the
risk associated with accident, sickness, death, and other
unpredictable circumstances
A nation’s money supply includes the entire stock of
currency and other liquid instruments circulating in a
country’s economy at a particular time
Commercial banks make/ earn profits from the difference
between the interest rates on deposits and those they
charge for loans; and from the fees and commissions they
charge for their services.
As a financial intermediary, an insurance company
collects the premiums, most of which is placed in long
terms investments such as bonds, mortgages, stocks, real
estates…
A medium of exchange is anything that is widely
2

14. How is money used as a means of payment?
15. What is a measure of value?/ a unit of account?
16. For what purposes is money used as a measure of value?
17. What is a store of value?
18. Does money function as a perfect store of value? Why?
19. What is a standard of deferred payments?
20. For what purposes is money used as a standard of deferred Money is used as a standard of deferred payments for
payments?
21. What is a barter economy?
accepted in payment for goods and services and in
settlement of debts.
Money is used as a means of payment through which
people exchange goods and services.
A unit of account (such as USD, VND, RMB…) or a
measure of value is the unit in which prices are quoted
and accounts are kept.
Money is used as a measure of value to measure the value
of things offered in markets and help simplify the
exchange of goods
Money is a store of value because can be used to make
purchase in the future
No. Money is not a perfect store of value especially when
there is inflation in the economy. /The value or
purchasing power of money may decrease in period of
inflation.
A standard of deferred payments is a function of money.
When you buy something and do not pay for it
immediately, your payment is expressed in terms of
money to be paid in the future.
specifying future payments for current purchases (Buy
now, pay later or Installment buying).
Barter economy is a cashless economic system in which
3
 services and goods are traded directly at negotiable rates.
22. What is token money? Token money is a means of payment whose value or
purchasing power as money greatly exceeds its cost of
production or value in uses other than as money.
23. What is commodity money? Commodity money is a useful good whose value or
purchasing power is about equal to the value of the
material contained in it.

Topic questions:
1. What are functions of the Central bank?
- to serve as a government’s banker
- to act as the banker of the banking system
- to regulate the monetary system for both domestic and international policy goals
- to issue a nation’s currency
2. How can the central bank implement the monetary policy?
The central bank uses 3 monetary policy tools to increase or decrease the money supply in the economy :
- reserve equipments
- open market operation
- interest rates
To increase the money supply, it lowers the reserve requirements, discount rates or buys government bonds. To
decrease the money supply, it increases the reserve requirements, discount rates or sells government bonds.
3. What are main functions of commercial banks?
Functions of commercial banks are to create money in circulation in saving banks and share-drafts in credit unions;
to maintain and create demand deposits by loans and investments.

4
 4. What are four functions of money?
- As a medium of exchange (anything widely accepted in payment for goods and services and in settlement of debt)
- As a measure of value (Money measures the value in the unit of account such as USD, VND, RMB…)
- As a store of value (Money can store the value because it can be used to make purchases in the future)
- As a Standard of Deferred payment (When you buy something and do not pay for it immediately, your payment is
expressed in terms of money to be paid in the future)
5. What is the most important function of money? Why?
- The most important function of money is a medium of exchange, which is anything widely accepted in payments
for goods and services and in settlement of debts.
- As a medium of exchange, money helps facilitate and promote trade. Money is the most common medium of
exchange.
6. What are differences between commodity money and token money?
- Token money is a means of payment whose value or purchasing power as money greatly exceeds its cost of
production or value in uses other than as money.
- Commodity money is a useful good whose value or purchasing power is about equal to the value of the material
contained in it.

UNIT 7 TAXATION

Questions
TYPES OF TAXES
1. What is the definition of taxation?
2. What is corporate income tax?
3. What is personal income tax
4. What is customs duty?
Answers
Taxation is the act of imposing tax on individuals or organizations by the
government to finance government programs.
Corporate income tax is the tax imposed on a compay’s profits.
Personal income tax is the tax imposed on individual’s income.
Customs duty is the tax imposed on imports and exports.

5
 5. What is excise tax? Excise tax is the tax imposed on specific goods such as wine, cigarettes, cars
6. What is capital transfer tax? Capital transfer tax is the tax on the gifts or inheritances over a certain value.
7. What is capital gain tax? Capital gain tax is the tax imposed on the profit from selling assets.
8. What is VAT tax? VAT is the tax imposed on each stage of production excluding the already-
taxed cost from the previous stages.
9. What are progressive taxes? Progressive tax is tax levied at higher tax rate on higher income.
10. What are regressive taxes? Pregressive tax is the tax that takes lower percentage in higher income and
higher percentage in lower income.
11. What are direct taxes? Direct tax is the tax paid directly to the government by the tax payer.
12. What are indirect taxes? Indirect tax is the tax paid indirectly to the government by the tax payer
13. What is the primary function of taxation? The primary function of taxation is to raise government revenue.
14. What is the function of corporate income Function of corporate income tax is to encourage capital investment.
tax?
15. What is the function of income tax in Income tax is used to redistribute society income or wealth.
general?
16. What is the function of excise tax? Excise tax is used to restrict the consumption of some certain goods that are
not good for health or environment.
17. What is one of the functions of customs Customs duty is used to protect domestic industry.
duty?
18. What is one of the functions of payroll Payroll tax is used to ensure social security and medicare.
taxes?
TAX AVOIDANCE & TAX EVASION
19. What is tax avoidance? Tax avoidance is using legal ways to avoid paying tax/ reducing the amount
of tax to legal minimum.

6
20. What are perks? Perks are non financial benefits or advantages of a job
21. What are loopholes in the tax laws? Loopholes in the tax laws mean a means or opportunity of avading a law.
22. What are tax shelters? Tax shelter means postponing the payment of tax such as by investing in life
insurance policies or pension plans.
23. What are tax deductibles? Tax deductible means subtracting the taxable income from the income such as
donating to charities.
24. How can a company avoid taxes on A company can avoid taxes on profits by making a tax loss or tax haven for a
profits? multinational company.
25. What are tax havens? Tax havens are countries which have low tax rate.
26. How can a multinational corporation It can set up head office in tax havens.
avoid paying taxes?
27. What is money laundering? Laundering money means passing money through series of companies in very
complicated transactions to disguise the origin from tax inspectors.
28. How does a criminal organization disguise It passes money through series of companies in a very complicated
the origin of their money from tax inspectors? transactions.
29. What is tax evasion? Tax evasion means using illegal ways to avoid the payment of tax.

TOPIC QUESTIONS

1. What are different functions of taxation?

1. Raise gov revenue to finance gov expenditure: defense, building infrastructure…
2. As a tool of fiscal policy, regulate the economy
3. Each type of tax has its own function:
+ customs duty: protect domestic goods….

7
+ excise tax: deterrent on some specific goods: cigarette, wine, cars
+ individual income tax: redistribute income
+ corporate income tax: encourage capital investment
+ payroll tax: ensure social security
2. What is tax avoidance? How do individuals avoid paying taxes?
Tax avoidance is using legal ways to avoid paying tax.
Individuals can avoid tax in some ways:
- Employers pay highly- paid employees perks instead of taxable money:
+ perk: non- financial benefits or advantages of a job: lunches, travelling. Health insurance.
- Tax shelter: postpone the payment of tax by investing in life insurance policies, pension plans…
- Tax deductible: subtracting taxable income by doing charity, listing dependants… never pay tax on subtracted
money.
3. What is tax avoidance? How do firms avoid paying taxes?
Tax avoidance is using legal ways to avoid paying tax.
Businesses can avoid tax in some ways:
- Making a tax loss: bring forward capital expenditure so that at the end of the year all the profits are used up.
- Tax havens: multinational companies set up head offices in tax havens. Tax havens are countries which have low tax
rates.
4. What are differences between progressive taxes and regressive taxes?
Progressive tax is a tax levied at higher rate on higher income while regressive tax is the tax that takes larger
percentage in lower income and lower percentage in higher income.
Progressive tax rate depends on income, so it can redistribute society income but regressive tax rate is often the same
for everyone so it can be unfair for the low income people.

5. What are differences between direct taxes and indirect taxes?

A direct tax is a tax that you directly pay to the authority imposing the tax, these taxes can’t be shifted to other
entities. Indirect tax is a tax that you indirectly pay to the authority imposing tax through an intermediary.
8
 Direct tax is often on income such as individual income or corporate income or property but indirect tax is on goods
and services such as VAT.
Direct tax can redistribute wealth in society but indirect tax can’t because indirect tax is often the same rate for
everyone.

UNIT 8 ACCOUNTING & FINANCIAL STATEMENTS

Questions Answers
ACCOUNTING BOOKS
1. What is the definition of accounting? Accounting is the process of identifying, measuring, recording, classifying,
summarizing, analyzing, interpreting and communicating the financial
transactions of a company.
2. What is a journal or a book of original? It is the book recording financial transactions for the first time.
3. For what purposes are the journals kept? They are kept for memorandum purpose.
4. What are ledgers? They include periodical records from a journal.
5. What is an account? An account includes similar transactions.
6. What are common financial statements? Balance sheet, Income statement and Cash flow statement
ACCOUNTING PROCESS
7. What do accountants have to do daily? They record financial transactions in a journal
8. What do accountants have to do regularly They transfer/ post information from a journal to a ledger
(monthly or quarterly)?
9. What do accountants have to do at the end They make financial statements.
of the fiscal year?
FINANCIAL STATEMENTS
9
10. What is the basic accounting equation? Assets= Liabilities + Owner’s equity
11. What information does a balance sheet A balance sheet provides information on financial condition of a business on
provide? a particular date, often the last day of financial year.
12. What do assets of a company include? Assets of a company include debtors or accounts receivable that are assumed
to be paid such as land, building, inventory, accounts receivables, …
13. What do liabilities of a company include? Liabilities include creditors or accounts payable that they will have to be paid
such as salary, rent, interest…
14. What information does an income Income statement provides information on a company’s revenue and expenses
statement provide? in a period of time.
15. What information does a cash flow Cash flow statement shows the flow of cash in and out of a business in a
statement provide? period of time.
ACCOUNTING INFORMATION
16. What are main types of accounting They are financial accounting information, management accounting
information? information and tax accounting information.
17. What is the definition of financial Financial accounting information shows information on financial resources,
accounting information? obligations and economic activities of a business.
18. For what purposes do potential investors Potential investors need financial accounting information to decide whether to
need financial accounting information of the place their scarce resources or not.
company?
19. For what purposes do creditors need Potential investors need financial accounting information to decide whether to
financial accounting information of the place their resources or not or to lend out or not.
company?
20. Why is financial accounting considered as Because it is used by different groups of users for different purposes.

10
“general purpose” accounting information?
21. For what purposes do managers of the Managers use accounting information to know the financial performance of
company use accounting information? the business, set overall goals, decide whether to introduce a new line of
products or not

TOPIC QUESTIONS

1. What is the accounting process?/ What are the main responsibilities of accountants?
1. Identify transactions and collect source documents.
2. Record transaction for the first time in a journal/ book of original entry.
3. Post/ Transfer information from journal to ledger accounts periodically.
4. Make a trial balance to make sure that Total credits are equal to total debits.
5. Use information in the ledger accounts to make financial statements.
2. What are financial statements? What information do they disclose?
Financial statements are balance sheet, income statement, cash flow statement. They disclose information about
financial position, financial performance or financial activities and flow of cash of a business in a period of time.
Hoặc nêu cụ thể từng loại balance sheet, income statement, cash flow statement.
3. What are differences between financial accounting and management accounting?
Financial accounting shows information about financial resources, obligations, financial activities of a business in
financial statements but management accounting information is the development and interpretation of financial
accounting information to assist management in runnign the business.
Financial accounting information is used by internal and external users such as creditors, investors, government,
managers, employees but management accounting information is used only by internal people such as managers and
employees.
Ngoài ra có thể thêm về format, issue frequency, reliability
4. What are differences between financial accounting and tax accounting?

11
 Financial accounting shows information about financial resources, obligations, financial activities of a business in
financial statements but tax accounting is based on financial accounting information and it is adjusted to conform the
tax reporting requirements.
Financial accounting information is mainly used by external people such as investors, creditors, government in tax returns.
Tax accounting information is used by managers or individuals to pay tax and tax authority to collect tax.

UNIT 9 MARKETING

Questions Answers

The "selling concept" assumes that resisting

consumers have to be persuaded by vigorous hard-
1. What is the “selling concept”?
selling techniques to buy non - essential goods and
services. Products are sold rather than bought.

The "marketing concept", on the contrary, assumes

that the producer's task is to find wants and fill them.
2. What is the “marketing concept”?
As well as satisfying existing needs, marketers can also
anticipate and create new ones.

Market opportunities are profitable possibilities of

3. What are market opportunities? filling unsatisfied needs of creating new ones in areas in
which the company is likely to enjoy a differential
advantage, due to its distinctive competencies.

Market segmentation is the process of dividing a target

4. What does “market segmentation”
market into smaller categories. It segments customers

12
 mean? and audiences into groups that share similar
characteristics.
Market research is the process of collecting, analyzing
5. What is “market research”? and interpreting information about a target market,
consumers, competitors and the industry as a whole.

6. What are 4Ps of the marketing mix? The marketing mix is a combination of the 4P’s:
product, price, promotion and place.

Aspects to be considered in marketing products

7. What do “marketing products”
include: quality, features (standard and optional), style,
include?
brand name, size, packaging, services and guarantee.

Aspects to be considered in marketing promotion

8. What does “marketing promotion”
include: advertising, publicity, sales promotion,
include?
personal selling, direct marketing.

Aspects to be considered in marketing price include:

9. What does “marketing price”
discounts, offer price, credit policy, price strategy,
include?
pricing, allowances, payment terms.

Aspects to be considered in marketing place include:

10. What does “marketing place”
distribution channels, locations of points of sale,
include?
transport, inventory size.

TOPIC QUESTIONS:
1. What are differences between “selling concept” and “marketing concept”?

13
 The difference between “selling concept” and “marketing concept” is the marketing objective is to understand the market
demand, then develop and create new products to satisfy customers’ needs and wants. While the objective of selling is to
produce the product first and then think about how to sell it on the market.
2. What is the important role of market research in the company’s success?
The important role of market research in the company’s success includes: Providing valuable data for decision-makers;
Researching consumer behavior; Helping the company choose the right advertising techniques; Providing data on the market
situation and Helping a company evaluate the effectiveness of its marketing activities and take steps to improve it.

UNIT 10 INTERNATIONAL BUSINESS

Questions Answers

Advantages & Disadvantages

International business encompasses all commercial

1. What is the definition of international activities that take place to promote the transfer of
business? goods, services, resources, people, ideas, and
technologies across national boundaries.

Some advantages of world trade for nations that

2. What are some advantages of world
trade for nations which export goods?
export goods are to promote increased production of
goods, provide business opportunities and wealth
accrues to exporting nations thereby develop their
economies.

14
3. What are some advantages of world
trade for nations which import goods?
4. What are some special programs of
the government to encourage exports?
5. What are some disadvantages of world
In addition, this can lead to an excessive widening of
trade for nations which import goods?
the trade gap between countries, with the loser being
the importing countries.
6. What is dumping?
THEORIES
7. What is the main content of the
absolute advantage?
The benefits include lower prices and better products
for consumers, improved political ties among nations,
and efficiency gains for domestic producers
Some special programs of the government to
encourage exports are: providing marketing
information, establishing trade missions, subsidizing
exports or tax benefits/ incentives.
World trade can lead to the dependence of
importing countries on exporting countries.
Therefore, it will hinder the development of some
specific industries.
Importing from abroad may harm the domestic
industries
Dumping is selling on foreign markets at a price below
the cost of production. It occurs when a country’s
businesses lower the sales price of their exports to gain
market share.
In a free market, countries produce whatever they can
most efficiently grow or manufacture or what is of the
greatest advantage to them.
15
8. What is the main content of the
comparative advantage?
TRADE BARRIERS
9. What are 4 common trade barriers?
10. What is tariff?
11. What is ad valorem tariff?
12. What is specific tariff?
13. What is the purpose of imposing
tariffs on imports?
14. What is “quota”?
15. What is the purpose of imposing
quotas on imports?
An exporting country doesn't have to be the most
efficient producer of the product, it only has to be more
efficient than the country which imports the product.
tariffs on imports, quotas on imports, subsidies and
embargo
A tariff is a tax that is paid on the import of goods and
services to increase the government’s revenue, protect
domestic companies against foreign competition. And it
acts as a tool to regulate import and export activities.
An ad-valorem tariff is based on the value of the
product.
A specific tariff is a certain amount of tax for each unit
of the product.
The purpose of imposing tariffs on imports is to
restrict imports and raise revenue for the
government. A tariff is added to the price of the
imported goods. This leads to fewer imports purchased,
and then more domestic production is sold.
Quota refers to a defined upper limit set by the
government, on the number of goods and services
imported from other countries or exported to other
countries in a particular period.
The purpose of imposing quotas on imports is to
restrict imports and promote exports. In general, a
16

16. What is government subsidy?
17. Why do governments subsidize
exports?
18. What is balance of trade?
19. What is trade balance deficit?
20. What is trade balance surplus?
21. What is balance of payments?
quota is simply a quantity restriction placed on a good,
service, or activity.
A government subsidy is a grant paid by a government
to an industry or an enterprise to benefit the public or to
keep prices low.
Governments subsidize exports because they can
improve Employment opportunities when export
requires more manpower. Secondly, encouraging
exports also help increase income, from which the
standard of living can be better. The last reason is
wealth often accrues to exporting countries.
The balance of trade is the difference between the
value of a country's exports and the value of a country's
imports for a given period. Balance of trade is the
largest component of a country's balance of payments.
A trade balance deficit happens when a country is
importing more than it exports.
A trade balance surplus happens when a country is
exporting more than it imports.
Balance of payment (BOP) is a statement of all
transactions made between entities in one country and
the rest of the world over a defined period, such as a
quarter or a year. BOP surplus is when a country
exports more than its imports and a deficit when a
country imports more than its export.
17
TOPIC QUESTIONS:
1. What are benefits of international business for the exporting nations?
Some advantages of world trade for nations that export goods are to promote increased production of goods, provide business
opportunities and wealth accrues to exporting nations thereby develop their economies.
2. What are benefits of international business for the importing nations?
The benefits include lower prices and better products for consumers, improved political ties among nations, and efficiency
gains for domestic producers.
3. What are disadvantages of international business for the importing nations?
World trade can lead to the dependence of importing countries on exporting countries. Therefore, it will hinder the
development of some specific industries.
In addition, this can lead to an excessive widening of the trade gap between countries, with the loser being the importing
countries.
Importing from abroad may harm the domestic industries

4. Why do particular countries can produce goods or services more efficiently than others?
Particular countries can produce goods or services more efficiently than others due to the influence of many factors such
as: Certain climates, Natural resources, Labor forces and Geographical location
Specifically, having a favorable geographical location with good climatic conditions or abundant resources and labor will be great
advantages for some countries to develop their potential. As a result, some countries will be able to produce some goods more
efficiently than others. For instance, the climates in the United State and Canada are suitable for the production of a large amount
of wheat while Vietnam has a favorable climate for rice production.
5. What are differences between the theory of absolute advantage and the theory of comparative advantage?
The theory of absolute advantage states that countries import products most efficiently manufactured abroad and export
products most efficiently produced domestically. While the theory of comparative advantage states that an exporting country
doesn’t have to be the most efficient producer, it’s only more efficient than the country importing the product

18
6. Why do governments want to impose trade barriers?
Governments want to impose trade barriers because they want to restrict imports to ensure employment for the population,
protect the domestic industry and avoid dependence on other countries.
7. Why do governments want to encourage exports? How can they encourage exports?
Countries encourage their exports because they can improve Employment opportunities. Export requires more manpower, so
that means more employment opportunities. Secondly, encouraging exports also help increase income, from which the standard of
living can be better. The last reason is wealth often accrues to exporting countries.
So, to do that they need to provide: marketing information, establish trade missions, subsidize exports or tax benefits/ incentives

19