The financial crisis appears when several segments of the financial market are temporarily unable to fulfil their functions. As a result, it is not possible for the economy to function smoothly. After reading about the financial crisis 2007-2009, Alicia Helman and her sister began to think about what situations to expect the crisis to appear on the market. Help her to decide which of the following situations may reveal the financial crisis:
A. Rapid increase in short-term interest rates on the money market
B. Rapid increase in foreign exchange prices
C. Reduction of foreign exchange market operations
D. Sudden fall in bond prices
Energy production in a power plant is highly inflexible because it cannot be stored. On the wholesale electricity market, it may happen that electricity prices are negative because demand is too low. This is not just a theoretical concept – sometimes buyers get both money and electricity. Which country was the earliest to introduce negative energy prices?
Mrs Alice’s yacht company produces export yachts. On 21 June, it signed an agreement with a foreign entity for the supply of 10 sea yachts with a total value of USD 2 million with a 3-month deferral. On the date of issue of the invoice, the USD/PLN exchange rate was 3.84. Being afraid of unfavourable changes in exchange rates, the company decided to hedge its revenues with a derivative. Which of the following options will allow the company to reduce the transaction risk?
A. American put option
B. European put opition
C. American call option
D. European call option
Which statement is true about growing in popularity Modern Monetary Theory?
A. Financing the government expenditures should not be considered as a tax objective
B. Saif’s law does not work in terms of fiat money
C. Budget surplus is harfmul for the economy and leads to a recession
D. Expansive fiscal policy may cause a decrease instead of an increase in the interest rate
According to the theory developed by Daniel Kahneman and Amos Tversky:
A. Person that is deciding to buy a train ticket instead of a plane ticket, after watching a documentary movie about aircraft crashes, probably undergoes availability heuristic.
B. The anchoring heuristic is about obstinate sticking to one’s own opinion, even after encountering opposite evidence.
C. If you flip a coin 3 times in a row and it’s head. That means that according to the mean reversion theory, probability of flipping a tail in a fourth throw is lower than 50%.
D. So-called “henpecked theory” says that men in a relationship have a tendency to partly adapt preferences of one’s partner in the process of making decisions.
A collector wants to sell his painting by an internationally renowned artist in the form of an auction. All of the bidders interested in buying the painting are risk-neutral, they make bids independently from each other and each bidder has a private valuation for the item independently drawn from some probability distribution. All of them have equal information, and there is no fee to join the auction. The collector has not decided yet which auction type he wants to use to sell his painting.
A. If he chooses the English auction, the dominant strategy for all bidders is (if it turns out to be necessary) to bid their true valuation of the painting.
B. From the perspective of the bidder who is able to offer the smallest amount of money for the painting, the Dutch auction is less favourable than first-price sealed-bid auction.
C. In equilibrium expected revenue is the same for the English auction and the first-price sealed-bid auction.
D. In equilibrium expected revenue is the same for the English auction and the Dutch auction.
Internet users gathered on a popular website in January 2021 initiated a short squeeze of the stock of a company with headquarters in Grapevine. Which statements regarding that situation are correct?
A. The stock price of the company in question increased by more than 600% in January 2021.
B. Regarding the situation, the website in question bought a 5-second commercial during the Super Bowl.
C. As a result of those events, trading platforms subsidised trade (of???) the stocks of the company in question for some time.
D. A lawsuit about market manipulation was filed against a user of the website in question.
Ms Penelope owns a bookshop. She decided to revolutionise the approach to marketing and customers in her company. She has recently read that Internet users more and more often use voice searches while using search engines. She therefore decided to optimise her website in such a way that it would more efficiently attract traffic from voice searches. Then she created a chatbot on Messenger and introduced click-to-messenger ads. Next she hired specialists to study her customers’ shopping habits – they were to track the path of 500 random customers during their visit in the bookshop and on that basis issue recommendations regarding the placement of bookshelves and the order of books on the shelves. What techniques did Ms Penelope use
B. Conversational marketing
C. Astroturf marketing
Many countries have begun to consider the possibility of introducing benefits to counteract poverty and the disappearance of professions displaced by increasing automatisation. This system of benefits is often a subject to extreme opinions in the public debate, as its financing is largely burdened by the state budget. In which of the following countries have these benefits been piloted or introduced?
Two factories producing cars and tractors were built on two sides of the border. The distance between factory A and the border is 50 km, whereas from factory B it is 150 km to the border. Factory A is producing 100 tractors daily at the same time factory B is producing 200 cars. Cost of 1 tractor transportation of 1km is 3 EUR when transport of 1 car of 1 km is 1 EUR. The fee on the border costs 60 EUR for 1 vehicle. What is the lowest cost of transport of the vehicles from factories to the warehouse which is built in the most optimal place? ( The factories are situated in the straight line perpendicular to the border, due to the applicable law, the distance between the warehouse and the border cannot be less than 5 km)
A. 52 000 EUR
B. 66 000 EUR
C. 50 000 EUR
D. 51 500 EUR
Answer key (VI Edition)
- A, B, C, D
- A, B
- A, C, D
- A, C, D
- A, B, D
- B, D
- A, B, D
Example of case study
Mr Marek is a passionate scooterist. As he saw a change in trends in public transport, he created Squterex, a company that offers rental of electric scooters for minutes. Initially, Squterex was the only company offering such services in Poland, thanks to which it earned above-average profits. The company built its position by offering its services in Krakow and, with time, expanding to Warsaw. Scooters can currently be rented within a radius of max:
- approx. 4,5 km from the Palace of Culture and Science in Warsaw
- approx. 3 km from the Main Square in Krakow.
The company has a low rental cost per minute (0,40 zł/ minute) and the cost of unblocking the scooter is 4 PLN. Since the beginning of existence of the company, charging and distribution of scooters in the city was handled by Mr. Marek. With the growth of the company he has outsourced these tasks to an external company.
Current marketing efforts are focused on promoting the company online – mainly running a paid advertising campaign on social media and Google ADS. Seasonally during the summer, the marketing department decided to advertise on billboards in the city center. Unfortunately, the company’s management was not satisfied with the results of the previous marketing efforts, which resulted in the creation of a program aimed at recommending the service to friends – for successfully inviting a new user to the application, referring customers receive free vouchers for rides.
Recently, due to increasing competition, Squterex has lost a significant part of its market share and, consequently, the company’s financial results have deteriorated. Because of this, the CEO of Squterex approached your consulting firm and requested you to prepare a restructuring plan for the company that would help Squterex regain its leading position. The company wants to generate high, long-term profits, so modification of the business model is being considered.
Due to the retirement of the current CMO, the company would like to redefine its marketing strategy. The current strategy has remained basically unchanged since the company’s beginnings. With the arrival of a new head of marketing, the team is open to innovation and eager to take on new activities. The management plans to take advantage of the increased motivation of the team, so your task is to prepare a marketing strategy that will set the direction of development for the coming years.
Mr Marek would like the company to set trends on the market again and open up to customers from other cities. Suggest which city in Poland would be the best expansion direction for Squterex.