Economics and Real Estate Quiz

A government faces a prolonged recession marked by high unemployment and low consumer spending. Despite low interest rates and abundant capital, private investment remains stagnant. A top economic advisor recommends increasing government spending to stimulate demand. Which economist’s theory most directly supports this recommendation?

• Adam Smith

• John Maynard Kaynes

• David Ricardo

• Alan Dave Navales

Answer explanation

The scenario highlights insufficient aggregate demand and economic stagnation. Keynesian economics asserts that during such downturns, active government intervention via increased public spending is essential to boost demand and employment. This contrasts with classical views like Smith's laissez-faire stance or Ricardo's labor value theory, which don't address demand-side issues in recessions.

Which of the following pairs of economists both emphasized structural constraints on economic outcomes, but differed in their primary focus—one on population-resource imbalance, the other on class conflict?

• John Maynard Kaynes and Adam Smith

• Adam Smith and David Ricardo

• Thomas Robert Malthus and Karl Marx

• Timothy Tan and Alan Dave Navales

A real estate investor purchases a property in a metropolitan area, banking on the location's proximity to major business hubs, schools, and transportation. Despite similar structures and lot sizes in other towns, this property commands a higher price due to its location. Which economic characteristic of real estate best explains this valuation?

• Improvements

• Area Preference or Situs

• Uniqueness

• Scarcity

Which of the following characteristics contributes to the permanence of land as a resource and makes real estate a long term investment, even when structures deteriorate?

• Improvements or modification

• Indestructibility or durability

• Fixity

• Scarcity

Following the development of a major infrastructure project under the 'Build, Build, Build' program, such as a new MRT line extension in Metro Manila, the surrounding barangays begin to see a spike in residential property inquiries and reservation sales, even before construction is completed. Which economic concept primarily explains this surge in buyer interest?

• Fixity

• Demand

• Supply

• Situs

A government economist reports that for the past two quarters, the country has experienced declining GDP, rising unemployment, and decreased consumer spending. Major retailers have reported lower sales, and several manufacturing firms have cut production. Based on these indicators, what stage of the business cycle is the Philippine economy most likely experiencing?

• Peak

• Recovery

• Recession/Contraction

• Trough

A property developer delays launching a new condominium project in Metro Manila after the Bangko Sentral ng Pilipinas (BSP) raises interest rates to address rising inflation. Which type of government policy is directly influencing the developer’s decision?

• Land use policy

• Fiscal policy

• Trade policy

• Monetary policy

Maria, aged 64, is planning to apply for a PagIBIG housing loan. She has no outstanding Pag-IBIG loan, passed the credit and employment check, and has made 20 monthly contributions so far. Which of the following must she do to meet the eligibility requirements?

• Wait until she reaches 65 to qualify for senior member benefits

• Cancel her previous STL account before applying

• Apply under a tacked loan with co-borrowers

• Make a lump-sum payment to complete the 24 months of required contributions

A borrower with a gross monthly income of ₱90,000 is applying for a Pag-IBIG housing loan amounting to ₱2,000,000. To determine if the borrower qualifies, which rule on monthly repayment capacity applies?

• Loan amount must not exceed ₱1,250,000 for approval

• Loan must be split among at least three co-borrowers

• Monthly amortization must not exceed 35% of gross monthly income

• Monthly amortization must not exceed 30% of gross monthly income

A sudden surge in consumer spending during the holiday season causes retail inventories to run low, prompting sellers to raise prices rapidly. Which type of inflation does this scenario best illustrate?

• Demand-pull inflation

• Structural inflation

• Imported inflation

• cost -push inflation