20 MCQs
1. A situation where we have people whose level of income is not sufficient to meet the minimum consumption expenditure is considered as—
(A) Absolute Poverty
(B) Relative Poverty
(C) Urban Poverty
(D) Rural Poverty
Ans. (A)
2. Full convertibility of a rupee means—
(A) Purchase of foreign exchange for rupees freely
(B) Payment for imports in terms of rupees
(C) Repayment of loans in terms of rupees
(D) Determination of rate of exchange between rupee and foreign currencies freely by the market forces of demand and supply
Ans. (D)
3. India is called a mixed economy because of the existence of—
1. Public Sector
2. Private Sector
3. Joint Sector
4. Cooperative Sector
(A) 1, 4
(C) 3, 4
(B) 1, 2
(D) 2, 4
Ans. (B)
4. Revealed Preference Theory was propounded by—
(A) Adam Smith
(B) Marshall
(C) P.A. Samuelson
(D) J.S. Mill
Ans. (C)
5. Gross Domestic Product is defined as the value of all—
(A) Goods produced in an economy in a year
(B) Goods and services produced in an economy in a year
(C) Final goods produced in an economy in a year
(D) Final goods and services produced in an economy in a year
Ans. (D)
6. An exceptional demand curve is one that moves—
(A) Upward to the right
(B) Downward to the right
(C) Horizontally
(D) Vertically
Ans. (A)
7. Production function explains the relationship between—
(A) Initial inputs and ultimate output
(B) Inputs and ultimate consumption
(C) Output and consumption
(D) Output and exports
Ans. (A)
8. In Economics the terms ‘Utility’ and ‘usefulness’ have—
(A) Same meaning
(B) Different meaning
(C) Opposite meaning
(D) None f the above
Ans. (B)
9. The present Indian monetary system is based on—
(A) Gold Reserve System
(B) Proportional Reserve System
(C) Convertible Currency System
(D) Minimum Reserve System
Ans. (D)
10. One of the essential conditions of monopolistic competition is—
(A) Many buyers but one seller
(B) Price discrimination
(C) Product differentiation
(D) Homogeneous product
Ans. (C)
11. Gresham’s law is related to—
(A) Consumption and demand
(B) Supply and demand
(C) Circulation of money
(D) Deficit financing
Ans. (C)
12. In a laissez-faire economy—
(A) The customers take all the decisions regarding production of all the cornmodities
(B) The Government does not interfere in the free functioning of demand and supply forces in the market
(C) The private sector takes all the decisions for price-determination of various commodities produced
(D) The Government controls the allocation of all the factors of production
Ans. (B)
13. In calculating National Income which of the following is included?
(A) Services of housewives
(B) Pensions
(C) Income of smugglers
(D) Income of watchmen
Ans. (D)
14. Who among the following has suggested tax on expenditure?
(A) Dalton
(B) Kaldor
(C) Musgrave
(D) Gautam Mathur
Ans. (B)
15. Bank-rate is the rate at which—
(A) A Commercial Bank borrows loans from some other Commercial Bank
(B) The Central Bank borrows loans from the Government
(C) The Commercial Bank gives loans to the public
(D) The Central Bank are-discounts the Commercial bills brought to it by the Commercial Banks
Ans. (D)
16. The annual record for all the monetary transactions of a country with other countries of the world is known as—
(A) Balance of trade
(B) Balance of monetary receipts
(C) Balance of payments
(D) Balance-Sheet
Ans. (C)
17. Which institution is known as ‘soft loan window’ of the World Bank?
(A) International Finance Corporation
(B) International Development Agency
(C) International Monetary Fund
(D) Indian Development Forum
Ans. (B)
18. ECOMARC is a symbol related to—
(A) Exported goods
(B) Imported goods
(C) Goods safe for environment
(D) Best quality
Ans. (C)
19. Consider the following reasons of continuous decline in average land-holding size in
India—
1. Law of inheritance
2. Consolidation
3. Farm mechanization
4. Desire of land ownership
Pick out the correct answer from the options given below—
(A) 1, 2, 3 and 4
(B) 1, 3 and 4
(C) l and 4
(D) 1 and 2
Ans. (C)
20. Which of the following sets belongs to Central tax?
(A) Excise duty, Sales tax and Customs duty
(B) Excise duty, Customs duty and Income- tax
(C) Income-tax, Customs duty and House tax
(D) Customs duty, Entertainment tax and Income tax
Ans. (B)
(A) Absolute Poverty
(B) Relative Poverty
(C) Urban Poverty
(D) Rural Poverty
Ans. (A)
2. Full convertibility of a rupee means—
(A) Purchase of foreign exchange for rupees freely
(B) Payment for imports in terms of rupees
(C) Repayment of loans in terms of rupees
(D) Determination of rate of exchange between rupee and foreign currencies freely by the market forces of demand and supply
Ans. (D)
3. India is called a mixed economy because of the existence of—
1. Public Sector
2. Private Sector
3. Joint Sector
4. Cooperative Sector
(A) 1, 4
(C) 3, 4
(B) 1, 2
(D) 2, 4
Ans. (B)
4. Revealed Preference Theory was propounded by—
(A) Adam Smith
(B) Marshall
(C) P.A. Samuelson
(D) J.S. Mill
Ans. (C)
5. Gross Domestic Product is defined as the value of all—
(A) Goods produced in an economy in a year
(B) Goods and services produced in an economy in a year
(C) Final goods produced in an economy in a year
(D) Final goods and services produced in an economy in a year
Ans. (D)
6. An exceptional demand curve is one that moves—
(A) Upward to the right
(B) Downward to the right
(C) Horizontally
(D) Vertically
Ans. (A)
7. Production function explains the relationship between—
(A) Initial inputs and ultimate output
(B) Inputs and ultimate consumption
(C) Output and consumption
(D) Output and exports
Ans. (A)
8. In Economics the terms ‘Utility’ and ‘usefulness’ have—
(A) Same meaning
(B) Different meaning
(C) Opposite meaning
(D) None f the above
Ans. (B)
9. The present Indian monetary system is based on—
(A) Gold Reserve System
(B) Proportional Reserve System
(C) Convertible Currency System
(D) Minimum Reserve System
Ans. (D)
10. One of the essential conditions of monopolistic competition is—
(A) Many buyers but one seller
(B) Price discrimination
(C) Product differentiation
(D) Homogeneous product
Ans. (C)
11. Gresham’s law is related to—
(A) Consumption and demand
(B) Supply and demand
(C) Circulation of money
(D) Deficit financing
Ans. (C)
12. In a laissez-faire economy—
(A) The customers take all the decisions regarding production of all the cornmodities
(B) The Government does not interfere in the free functioning of demand and supply forces in the market
(C) The private sector takes all the decisions for price-determination of various commodities produced
(D) The Government controls the allocation of all the factors of production
Ans. (B)
13. In calculating National Income which of the following is included?
(A) Services of housewives
(B) Pensions
(C) Income of smugglers
(D) Income of watchmen
Ans. (D)
14. Who among the following has suggested tax on expenditure?
(A) Dalton
(B) Kaldor
(C) Musgrave
(D) Gautam Mathur
Ans. (B)
15. Bank-rate is the rate at which—
(A) A Commercial Bank borrows loans from some other Commercial Bank
(B) The Central Bank borrows loans from the Government
(C) The Commercial Bank gives loans to the public
(D) The Central Bank are-discounts the Commercial bills brought to it by the Commercial Banks
Ans. (D)
16. The annual record for all the monetary transactions of a country with other countries of the world is known as—
(A) Balance of trade
(B) Balance of monetary receipts
(C) Balance of payments
(D) Balance-Sheet
Ans. (C)
17. Which institution is known as ‘soft loan window’ of the World Bank?
(A) International Finance Corporation
(B) International Development Agency
(C) International Monetary Fund
(D) Indian Development Forum
Ans. (B)
18. ECOMARC is a symbol related to—
(A) Exported goods
(B) Imported goods
(C) Goods safe for environment
(D) Best quality
Ans. (C)
19. Consider the following reasons of continuous decline in average land-holding size in
India—
1. Law of inheritance
2. Consolidation
3. Farm mechanization
4. Desire of land ownership
Pick out the correct answer from the options given below—
(A) 1, 2, 3 and 4
(B) 1, 3 and 4
(C) l and 4
(D) 1 and 2
Ans. (C)
20. Which of the following sets belongs to Central tax?
(A) Excise duty, Sales tax and Customs duty
(B) Excise duty, Customs duty and Income- tax
(C) Income-tax, Customs duty and House tax
(D) Customs duty, Entertainment tax and Income tax
Ans. (B)
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