MP SET 2017

Q.No: 1 Under perfect competition is -

A Each buyer and seller is price maker
B Buyer’s are price maker while seller’s are price taker
C Buyer’s are price taker while seller’s are price maker
D Each buyer and seller in the market is a price taker
ANS (D)

Q.No: 2 The kinked demand curve explains

A Price rigidity
B Price flexibility
C Demand rigidity
D Demand flexibility
ANS ( A)

Q.No: 3 Which of the following statement is false -

A Price elasticity of demand is negative for most products
B Price elasticity of supply is positive for most goods
C Income elasticity of demand is positive for normal goods
D Cross elasticity of demand is positive between complementry goods
ANS (D)

Q.No: 4 "Inferior goods" are those goods " "

A For which demand increases as price increases
B Which are in very short supply
C Which have zero cross elasticity of demand
D For which demand increases as income decreases
ANS (D)

Q.No: 5 The price elasticity of demand in the demand function = apb is

A A a
B 1 1
C B b
D Ab ab
ANS (C)

Q.No: 6 When average revenue is Rs. 12.00 and average cost is Rs. 10.00 then firm makes

A Normal profit
B Super normal profit
C Net profit
D Gross profit
ANS (B)

Q.No: 7 For downward movement along the iso-quant MRTS of labour per unit of capital(MRTSLK) is given by - (MRTSLK)

A dk/dl
B -dk/dl
C dl/dk
D -dl/dk
ANS (B)

Q.No: 8 The Multiplier effect will be applicable on -

A Consumption
B Govt. Expenditure
C Net Export
D All are correct
ANS (D)

Q.No: 9 The permanent income hypothesis of consumption was given by -

A Roberston
B Friedman
C Fisher
D Marshall
ANS (B)

Q.No: 10 The estimation of national income in India is undertaken by -

A Central statistical organization
B National income committee
C Planning commission
D Reserve Bank Of India
ANS (A)

Q.No: 11 "A country is poor because it is poor" are the words of

A Singer
B Hicks
C Nurkse
D Myrdal
ANS (C)

Q.No: 12 Which of the following is not an instrument of monetary policy -

A Open market operation
B Bank rate
C Selective credit control
D Govt. Expenditure
ANS (D)

Q.No: 13 If the RBI desire to decrease the money supply then it should

A Lower the bank rate
B Purchase securities from open market स
C Increase the CRR CRR
D Lower the repo rate
ANS (C)

Q.No: 14 Speculative demand for money is dependent on -

A Income
B Reserve money
C Both (Income & Reserve money)
D None of these are correct
ANS (D)

Q.No: 15 Concept of economic development includes

A Social sector development
B Inclusive growth
C Poverty eradication
D All of these are correct
ANS (D)

Q.No: 16 Who wrote 'Das Capital' 

A Karl Marx
B Adam Smith
C Marshall
D Pigou
ANS (A)

Q.No: 17 Golden age of development is said, when

A G = Gn = Gw
B G < Gn < Gw
C G > Gn > Gw
D None of these are correct
ANS (A)

Q.No: 18 Who as propounded the theory of maximum social advantage -

A Myrdal
B Dalton
C Alfred Weber
D None of these are correct
ANS (B)

Q.No: 19 When did the first human development report published

A 1972
B 1982
C 1992
D 2002
ANS (D)

Q.No: 20 Which of the following plan aimed at improving the standard of living -

A Third plan
B Fourth plan
C Fifth plan
D Eighth plan
ANS (C

Q.No: 21 When was first new Industrial policy has been declared in India -

A April 1948
B April 1949
C April 1950
D April 1952
ANS (A)

Q.No: 22 The first five year plan of the Government Of India is based on -

A Leontief input – output model
B Mahalanobis two sector model
C Harrod - Domar model
D Mahalanobis four sector model
ANS (C)

Q.No: 23 The theory of public goods has been given by

A Sameulson
B Marshall
C Hicks
D None of these are correct
ANS (A)

Q.No: 24 Which one of the following is causes of the international debt crisis -

A Bad macro-economic management
B Rising interest rate
C Trade policies
D All are correct
ANS (D

Q.No: 25 Marginal efficiency of capital represents

A Not affected by rate of interest
B Affected by the reduction in rate of interest
C Affected by the increase in rate of interest
D All are correct
ANS (A)

Q.No: 26 The formula of high powered money -

A C + Cr + RR C + Cr + RR
B C + D + ER C + D + ER
C C + RR + ER C + RR + ER
D C + ER C + ER
ANS (C)

Q.No: 27 Who is the writer of the book "A contribution to the theory of Trade cycle" "A Contribution to the theory of Trade cycle"

A Keynes
B Marshall
C Pigou
D Hicks
ANS (D)

Q.No: 28 What is measured by "Lorenz Curve"

A Absolute equality
B Relative equality
C Unemployment
D Income inequality
ANS (D)

Q.No: 29 Tobin tax is a tax on

A Tax on Export
B Tax on Import
C Tax on Transactions in foreign exchange
D Tax on Sales
ANS (C)

Q.No: 30 Which tax from the following is levied by union Govt.?

1.Income- tax
2.Custom duty
3.Central excise duty
4.Sales tax

A 1 and 2
B 1, 2 and 3
C 1, 2 and 4
D All
ANS (B)

Q.No: 31 Transitional expenditure is related to which of the following -

A Education
B Tele communication
C Transportation
D All of these are correct
ANS (D)

Q.No: 32 Article 280 of constitution is related to 280

A Finance commission
B Information commission
C Planning commission
D Nana wati commission
ANS (A)

Q.No: 33 When did "MODVAT" come? "MODVAT"

A 1 March 1986
B 1 March 1985
C 1 March 1988
D 1 March 1987
ANS (A)

Q.No: 34 Which of the following is not a part of foreign exchange reserve of India-

A Gold
B SDRs
C Foreign currency assets
D Securities held by the bank and co-operative institutions
ANS (D)

Q.No: 35 Which one of the following has propounded theory of reciprocal demand to explain determination of equilibrium terms of trade -

A Mill
B Ricardo
C Haberler
D Heckscher – Ohlin -
ANS (A)

Q.No: 36 In which year general Agreement on Tariffs and Trade (GATT) was setup

A 1950
B 1949
C 1948
D 1946
ANS (C)

Q.No: 37 The first historical summit of (SAARC) held in

A New Delhi
B Dhaka
C Lahore
D Colombo
ANS (B)

Q.No: 38 Bretton–wood is situated in

A New Zealand
B New – York
C New – Hampshire –
D New – Heaven –
ANS (C)

Q.No: 39 Special drawing rights (SDRS) are in the form of : र (SDRS)

A Paper currency
B Gold स
C Silver and Gold both
D Book keeping entry only
ANS (D)

Q.No: 40 Which one is the descending order of the various sectors contributed to India gross domestic product -

A Services – Industry – Agriculture
B Services – Agriculture –Industry
C Industry – Services- Agriculture
D Industry – Agriculture –Services
ANS (A)

Q.No: 41 Which of the following committee recommend capital account convertibility ?

A Narsinham committee
B Abid-hussian committee
C Rangrajan committee
D Tarapore committee
ANS (D)

Q.No: 42 Responsibility of commercial bank is –

1.Time deposit
2.Demand deposit
3.Holding of security
4.Advance from central bank

A 1 and 2
B 1, 2 and 3
C 1, 2 and 4
D 1, 2, 3 and 4
ANS (C)

Q.No: 43 Which of the following problem does not belong to small and cottage industries -

A Less use of capacity
B Lack of capital
C Competitive market
D Govt. policies
ANS (D)

Q.No: 44 If absolute error is +20 and relative error is +0.02, then actual value will be -

A 1020 1020
B 980 980
C 506 506
D None of these are correct
ANS (D)

Q.No: 45 Vertical curve represents the value of co-efficient of correlation to be -

A Positive
B Negative
C Zero
D 1 1
ANS (C)

Q.No: 46 If r = 0.6 and N = 64 then find the probable error of coefficient of correlation

A 0.034
B 0.054
C 0.044
D 0.064
ANS (B)

Q.No: 47 The null hypothesis of the sign test is that

A Half the ranks to be less than the median and half greater than the median
B Half the ranks to be less than the mean and half greater than the mean
C The lower half the ranks to have the same mean  as the upper half
D The lower half the ranks to have the same (SD) as the upper half (SD)
ANS (A)

Q.No: 48 In a moderately skewed distribution र

A A.M. > G.M.> H.M.
B G.M. > A.M. > H.M.
C H.M. > G.M. > A.M.
D H.M. > A.M. > G.M.
ANS (A)

Q.No: 50. Probability which is based on self beliefs of persons involved in experiment is classified as -

A Subjective approach
B Objective approach
C Initiative approach
D Sample approach
ANS (A)

                  Part-B

Q.No: 1 The point of tangency between the social welfare function & the utility possibility curve is -

A The Bliss point
B The break-even point
C The pareto Optimum point
D The second best point
ANS (A)

Q.No: 2 If demand function X = 20 – P2 then price P = 2, what will be the elasticity of demand?

A ed = ½
B ed = -2
C ed -2/4
D ed = -3/4
ANS (A)

Q.No: 3 Kinked demand theory was developed in

A 1938
B 1939
C 1941
D 1943
ANS (B)

Q.No: 4 According to the permanent income hypothesis:

A Long-run aggregate Average Propensity to Consume (APC) equal the long run aggregate Marginal Propensity to Consume(MPC)
B Long-run aggregate APC is greater than the long run aggregate MPC
C Long-run aggregate APC is less than the long run aggregate MPC
D APC of every individual is equal irrespective of different income level.
ANS (A)

Q.No: 5 Which of the following is true about a firm in perfectly competitive market? (Where MPL is marginal product of labour, MR is marginal revenue and P is the price of the product or average revenue )

A MPL x MR = MPL x P
B MPL x MR < MPL x P
C MPL x MR > MPL x P
D MPL x MR MPL x P
ANS (A)

Q.No: 6 Which of the following is not a correct match ?

A Inflationary Gap – Keynes -
B Cash Balance Approach - Pigou
C Accelerator – Multiplier - Hicks analysis -
D Equation of exchange – Marshall
ANS (D)

Q.No: 7 The credit multiplier based on the Assumption that –

1. The CRR remain constant
2. The bank maintain a fix relationship between deposit

liabilities and cash reserves

3. People prefer higher cash holding
4. People got well developed banking habits

Select the correct one from the code below

A 1, 2 and 3
B 1, 2 and 4
C 1 and 4
D 2, 3 and 4
ANS (B)

Q.No: 8 Which statement is true in connection of above mentioned diagram –

1. Investment is autonomous
2. Saving is autonomous
3. Investment depend on Income
4. Saving is depend on Income

A 2 and 3
B 1 and 4
C Only 3
D Only 1
ANS (B)

Q.No: 9 GNP deflator

A GNP deflator = (Real GNP)/(Nomial GNP) x 100
B GNP deflator = (Real GNP)/(Real GDP) x 100
C GNP deflator = (Real NDP)/(Nomial NDP) x 100
D GNP deflator = (Nomial GNP)/(Real GNP) x 100
ANS (D)

Q.No: 10 The Phillips curve depicts

A The business cycle of the economy
B Relationship between money supply and inflation rate
C Inflation and unemployement are unrelated in the short run
D Decrease in inflation rate temporarily increase unemployment rate
ANS (D)

Q.No: 11 How much calories consumption fixed per day to determine rural poverty by planning commission of India.

A 2200
B 2300
C 2100
D 2400
ANS (D)

Q.No: 12 What will be the real growth rate. If at some point of time income is Rs.600 crores. Saving is Rs.430 crores and capital output ratio:4:1

A 2 percent
B 4 percent
C 6 percent
D 8 percent
ANS (A)

Q.No: 13 In which year the Kissan credit card system was introduced?

A 1978 1978
B 1998 1998
C 1988 1988
D 2008 2008
ANS (B)

Q.No: 14 The premise, that benefit of economic growth will reach all section of population is called

A Trickle up effect
B Trickle down effect
C Take-off effect
D Regressive effect
ANS (B)

Q.No: 15 According to 2011 census what is the density of population of India.
-
A 316 316
B 324 324
C 382 382
D 392 392
ANS (C)

Q.No: 16 The distribution of the burden of paying tax is called

A Sharing of tax burden
B Shifting of tax
C Incidence of the tax
D Tax capitalization
Question Deleted
ANS (C)

Q.No: 17 The business cycle is defined as

A An effort to reach full employment
B Changing wage & prices
C The growth in Real GDP
D Changing the period of economic growth & contraction
ANS (D)

Q.No: 18 The role of government taxes and spending to get economic outcomes is known as.

A Fiscal policy
B Monetary policy
C Foreign trade policy
D Income policy
ANS (A)

Q.No: 19 Which of the following will cause the investment demand curve to shift to the left

A A decrease in tax
B Improvement is expected in future sales
C Increase in interest rate
D Increase in price of raw material
ANS (C)

Q.No: 20 Distinction between autonomous investment and induced investment has been made by

A Classical economist
B Keynesian economist
C Post-Keynesian economist
D All are correct
ANS (C)

Q.No: 21 In which year the new liberalized industrial policy was announced in India

A 1990 1990
B 1991 1991
C 1993 1993
D 1995 1995
ANS (B)

Q.No: 22 "Vent for surplus approach" is applicable to

A Rich countries
B Under developed countries
C Oil exporting countries
D None of these are correct
ANS (B)

Q.No: 23 Which of the following is not a fiscal instrument

A Open market operation
B Public expenditure
C Taxation
D None of these are correct
ANS (A)

Q.No: 24 Function of money are

A Medium of exchange
B Unit of value
C Both (Medium of exchange & Unit of value)
D None of these are correct
ANS (C)

Q.No: 25 Type of Inflation are

A Creeping Inflation
B Walking Inflation
C Running Inflation
D All are correct
ANS (D)

Q.No: 26 Which one of the following is not a function of commercial bank

A Issuing currency
B Credit creation
C Issuing travelers cheque
D None of these are correct
ANS (A)

Q.No: 27 According to Keynes the transaction demand for money is mainly a function of

A Rate of interest
B Profit
C Wages
D Income
ANS (D)

Q.No: 28 Which one of the following represents M3

A M1 + post office saving bank deposit
B Currency with public + demand deposits
C M1 + time deposits with bank
D None of these are correct
ANS (C)

Q.No: 29 The elasticity of speculative demand for money under the liquidity trap condition will be

A Zero
B One
C Greater than one
D Infinite
ANS (D)

Q.No: 30 The theory that the transaction demand for money also depends on the rate of interest was put forwarded by

A Keynes and pigou
B Baumol and Tobin
C Hicks and Solo
D Samuelson and Meada
ANS (B)

Q.No: 31 The MRTP Act of 1969 has been

A Replaced by competition Act, 2002
B Merged in industrial policy Act of 1978
C Merged in industrial policy Act of 1991
D None of these are correct
ANS (A)

Q.No: 32 The seventh plan marked a departure from

A Harrod–Domar grow mode;
B Mahalanobis model
C Vakil brahmhanand model
D Kaldorian model
ANS (B)

Q.No: 33 The Quick Mail Service(QMS) was introduced in

A 1965
B 1985
C 1975
D 1955
ANS (C)

Q.No: 34 When was SIDBI established

A 1969 1969
B 1979 1979
C 1989 1989
D None of these
ANS (D)

Q.No: 35 When did second Industrial policy announced

A April 1956 1956
B April 1955 1955
C April 1961 1961
D April 1965 1965
ANS (A)

Q.No: 36 Who is known as a father of Green Revolution in India?

A M.S. Swaminathan .
B Abhijit Sen
C K.N.Natraj . .
D None of these are correct
ANS (A)

Q.No: 37 Family welfare programme has been launched in India?

A 1953
B 1955
C 1951
D 1957
ANS (C)

Q.No: 38 What is Poverty Index According to Sen's

A Intensity of Poverty
B Equality of Poverty
C Equality of Absolute Poverty
D Equality of relative Poverty
ANS (A)

Q.No: 39 Which is an important characteristics of developing economy

A Low level of human development Index
B Excess of capital
C Low level of fundamental resources
D Both (Low level of human development Index & Low level of fundamental resources)
ANS (D)

Q.No: 41 Argument in favour of infant industry -

A Price discrimination
B Product diversification
C Protection of domestic Industries
D Resource accumulation
ANS (C)

Q.No: 42 NFSH is abbreviation for

A National Family Health Survey
B National Farmers Health Survey
C National Family Household Survey
D None of these are correct
ANS (D)

Q.No: 43 Which one of the following is Ravi crop

A Rice
B Jowar
C Cotton
D Peas
ANS (D)

Q.No: 44 Who is known as the Father of White Revolution?

A V.Kurian .
B M.S. Swaminathan
C Baba Ramdev
D Baba Amte
ANS (A)

Q.No: 45 The present share of agriculture in GDP of India is around?

A 11 11
B 14 14
C 59 59
D 60 60
ANS (B)

Q.No: 46 A centralized (cartel) -

A Lead to monopoly solution
B Behaves as the multi plant monopolist, if it wants to minimize the total cost of production
C It is illegal in the U.S. .
D All are correct
ANS (D)

Q.No: 47 NAFED is a

A Industry
B Non-government organization
C Government body
D Co-operative organization
ANS (D)

Q.No: 48 In a negative skewed distribution, order of mean, median and mode is

A mean < median < mode
B mean > median > mode
C mean < median > mode
D mean > median < mode
ANS (A)

Q.No: 49 Which of the following is an absolute measure of dispersion?

A Coefficient of variation
B Coefficient of Range
C Standard deviation
D Coefficient of Skewnes
ANS (C)

Q.No: 50 Three factories A, B, C have 100, 200 and 300 workers respectively. The mean of the wages is the same in three factories. Which of the following statement is true?

A There is a great variance in factory C C
B Standard deviation in factory A is smallest A
C Standard deviation is factory C is equal C
D None of these are correct
ANS (D)

Q.No: 51 Which measure of correcting the disequilibrium of balance of payment is known as "Marshall Lerner condition"

A Flexible exchange rate
B Controlled exchange rate
C Revaluation elasticity approach
D Absorption mechanism
ANS (A)

Q.No: 52 Who propounded purchasing power parity theory -

A Viner
B Ricardo
C Ohlin
D None of these are correct
ANS (D)

Q.No: 53 Laspeyre's Index = 100, paache's Index = 108, the fisher's Ideal index is equal to

A 110 110
B 100 100
C 108 108
D 109 109
ANS (D)

Q.No: 54 In a straight line equation Y = a + bx; b is the

A Y – intercept
B Slop
C X- Intercept
D Trend
ANS (B)

Q.No: 55 Which of the following are the type of disequilibrium in balance of payment?

A Secular disequilibrium
B Cyclical disequilibrium
C Structural disequilibrium
D All are correct
ANS (D)

Q.No: 56 Keynes argued that the level of economic activity is predominantly deteremined by the level of

A Aggregate demand
B Aggregate supply
C Unemployment
D Interest rate
ANS (A)

Q.No: 57 Which theory is generally included under Micro economics- :
-
A Price theory
B Income theory
C Employment theory
D None of these are correct
ANS (A)

Q.No: 58 For a monopolist price is 16 and marginal revenue is 4 the elasticity of demand will be -

A 4/3 4/3
B ¾ 3/4
C 4 4
D ¼ 1/4
ANS (D)

Q.No: 59 Who among the following economists used the technique of kinked demand curve to explains price rigidity under oligopoly?

A Paul sweezy
B Hall and Hitch
C Chamberlin
D Stigler
ANS (A)

Q.No: 60 What would be the consequences for the OLS estimator heteroscedasticity is present in a regression model but ignored?

A It will be biased
B It will be inefficient
C It will be inconsistent
D All are correct
ANS (B

Q.No: 61 Euro came into circulation since

A January 1, 1996
B January 1, 1997
C January 1, 1998
D January 1, 1999
ANS (D)

Q.No: 62 Who sanction soft loans

A IMF IMF
B IDA IDA
C WTO WTO
D None of these
ANS (B)

Q.No: 63 Statement (A) – special drawing right is a only bookkeeping entry of a account of any country
Reason(R) – Special drawing Right is also known as paper Gold. Explanation:

A Both 'A' and 'R' correct and 'R', is correct explanation of 'A'
B Both 'A' and 'R' correct and 'R', is not correct explanation of 'A'
C 'A' is true but 'R' is false
D 'A' is false but 'R' is true
ANS (A)

Q.No: 64 At the present bilateral trade between India and Viyatnam is 4.8 crores dollar. Now by 2050 it will reached to how many crores?

A 11 crore dollar 11
B 15 crore dollar 15
C 17 crore dollar 17
D 19 crore dollar 19
ANS (B)

Q.No: 65 Newly established universal bank have to register their shares with the stock exchange with in 6 years, from starting work as per the new Direction of August 2016. Before that this restriction was limited to

A 2 years 2
B 3 years 3
C 4 years 4
D 5 years 5
ANS (B)

Q.No: 66 Low productivity for agriculture in India attributed to

A Poor irrigation
B Heavy dependence on monsoon
C Absence of new technology
D All are correct
ANS (D)

Q.No: 67 Which Indian state stand first in the production of coffee

A Haryana
B Punjab
C Utter Pradesh
D Karnataka
ANS (D)

Q.No: 68 Which Industry provides the largest employment in India?

A Chemical Industry
B Textiles Industry
C Iron and Steel Industry
D Jute Industry
ANS (B)

Q.No: 69 Which of the following organization looks after the credit needs of agriculture and Rural development in India?

A FCI
B IDBI
C NABARD
D ICAR
ANS (C)

Q.No: 70 The strategy of rolling plan was adopted under the PrimeMinistership of

A Indira Gandhi
B Morarji Desai
C Rajiv Gandhi
D Jawaharlal Nehru
ANS (B)

Q.No: 71 Which elements are included under technological process by Prof. Kuznet’s

A Scientific discovery and invention
B Innovation and improvement
C Technical social change
D All are correct
ANS (D)

Q.No: 72 The role of state under globalization is-

A Zero
B Maximum
C Minimum
D Indifferent
ANS (C)

Q.No: 73 The growth of agriculture production was negative in the-

A First plan
B Second plan
C Third plan
D All are correct
ANS (C)

Q.No: 74 Who wrote the book on "economic backwardness & economic growth" in 1957 "economic backwardness & economic growth" 1957

A Schumpeter
B Karl Marx
C Leibenstine
D Marshall
ANS (C)

Q.No: 75 Economic environment is influenced by -

A Domestic economic situation
B World economic situation
C Both (Domestic economic situation & World economic situation)
D None of these are correct
ANS (C)