McqMate
These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Bachelor of Business Administration (BBA) .
Chapters
| 51. |
Which of the following is not a component of domestic income? |
| A. | operating surplus |
| B. | compensation of employees |
| C. | net factor income from abroad |
| D. | mixed income |
| Answer» C. net factor income from abroad | |
| 52. |
If factor cost is greater than marker price, it means that |
| A. | indirect taxes < subsidies (subsidy> indirect taxes) |
| B. | indirect taxes > subsidies |
| C. | i.t = subsidies |
| D. | none |
| Answer» A. indirect taxes < subsidies (subsidy> indirect taxes) | |
| 53. |
An Indian farmer produces wheat without incurring cost of inputs alll
|
| A. | 1,600 |
| B. | 2,200 |
| C. | 1,000 |
| D. | 1,400 |
| Answer» A. 1,600 | |
| 54. |
Which of the following is not true about final goods ? |
| A. | final gods satisfy wants of ultimate consumers and producers. |
| B. | final goods have direct demand as they satisfy the wants directly. |
| C. | final goods are subject to further transformation in the process of production. |
| D. | final goods are neither used up as raw-material nor for resale in the same year. |
| Answer» C. final goods are subject to further transformation in the process of production. | |
| 55. |
Following is an example of final good: |
| A. | flour used by a banker in making biscuits |
| B. | unsold stock of goods lying with the sellers |
| C. | tyres purchased by a transport company |
| D. | mobile sets purchased by a mobile dealer |
| Answer» B. unsold stock of goods lying with the sellers | |
| 56. |
Which out of the following is not included in estimation of NI? |
| A. | subsidized lunch |
| B. | old-age pension |
| C. | free medical facilities |
| D. | construction of a house |
| Answer» B. old-age pension | |
| 57. |
Which of the following is a synonym of “Undistributed Profits”? |
| A. | savings of private corporate sector |
| B. | reserves and surplus |
| C. | retained earnings |
| D. | all of these |
| Answer» D. all of these | |
| 58. |
Piyush’s mother is a teacher. She also teaches Piyush. How would you treat this white calculating national income and domestic income ? |
| A. | it will be included in the national income, but not in the domestic income. |
| B. | it will be included in the domestic income, but not in the national income. |
| C. | it will be included in domestic income as well as national income. |
| D. | it will neither be included in the domestic income nor in the national income. |
| Answer» D. it will neither be included in the domestic income nor in the national income. | |
| 59. |
Goods which are not used in the production of other goods are called: |
| A. | capital goods |
| B. | consumption goods |
| C. | producer goods |
| D. | intermediate goods |
| Answer» B. consumption goods | |
| 60. |
Depreciation is the: |
| A. | loss of vale of fixed assets in use due to normal wear and tear |
| B. | loss of value of fixed assets in use due to normal rate of accidental damages |
| C. | loss of value of fixed assets in the due to foreseen obsolescence |
| D. | all of these |
| Answer» D. all of these | |
| 61. |
Which of following is not included in national income ? |
| A. | factor income |
| B. | rent |
| C. | operating surplus |
| D. | transfer income |
| Answer» D. transfer income | |
| 62. |
Which of following is not an intermediate goods? |
| A. | wheat |
| B. | gold |
| C. | service of doctor |
| D. | sand and bricks |
| Answer» C. service of doctor | |
| 63. |
Which of following is not a final good? |
| A. | machinery purchased by dealer |
| B. | machinery purchased by a factory |
| C. | use of petrol |
| D. | washing machine |
| Answer» A. machinery purchased by dealer | |
| 64. |
Which of following is not a part of national income? |
| A. | depreciation |
| B. | net factor income from abroad |
| C. | operating surplus |
| D. | mixed income |
| Answer» A. depreciation | |
| 65. |
Product method of calculating national income is also known as: |
| A. | income method |
| B. | value added method |
| C. | expenditure method |
| D. | distribution method |
| Answer» B. value added method | |
| 66. |
Transfer payments refer to payments, which are made: |
| A. | without any exchange of goods and services |
| B. | to workers on transfer from one job to another |
| C. | as compensation to employees |
| D. | none |
| Answer» A. without any exchange of goods and services | |
| 67. |
National Income differs from Net National Product at market price by the amount of: |
| A. | current transfers from rest of the world |
| B. | net indirect taxes (difference between indirect tax and subsidy) |
| C. | national debt interest |
| D. | it does not differ |
| Answer» B. net indirect taxes (difference between indirect tax and subsidy) | |
| 68. |
Net national product at factor cost is also known as: |
| A. | net domestic product |
| B. | gross national product |
| C. | national income |
| D. | personal income |
| Answer» C. national income | |
| 69. |
In GNP calculation which of the following should be excluded? |
| A. | rental incomes |
| B. | interest payments |
| C. | dividends |
| D. | government transfer payment |
| Answer» D. government transfer payment | |
| 70. |
National Income differs from Net National Product at market price by the amount of: |
| A. | current transfers from rest of the world |
| B. | net indirect taxes |
| C. | national debt interest |
| D. | it does not differ |
| Answer» B. net indirect taxes | |
| 71. |
Excess demand for money, according to Say’s law in the Economy: |
| A. | is greater |
| B. | is very less |
| C. | is equal to zero |
| D. | there is no relationship between excess demand for money and say’s law |
| Answer» D. there is no relationship between excess demand for money and say’s law | |
| 72. |
Which of the following is not an assumption of classical theory? |
| A. | price flexibility |
| B. | unemployment |
| C. | say’s law |
| D. | neutrality of money |
| Answer» B. unemployment | |
| 73. |
In classical theory the equality between saving and investment is brought about by: |
| A. | rate of interest |
| B. | income |
| C. | consumption |
| D. | multiplier |
| Answer» A. rate of interest | |
| 74. |
The normal condition of a capitalist economy in classical theory is: |
| A. | underemployment |
| B. | full employment |
| C. | general unemployment |
| D. | frictional unemployment |
| Answer» B. full employment | |
| 75. |
In classical theory of employment, there is the possibility of: |
| A. | voluntary unemployment |
| B. | no unemployment |
| C. | involuntary unemployment |
| D. | disguised unemployment |
| Answer» A. voluntary unemployment | |
| 76. |
“Supply creates its own demand “is a law of: |
| A. | investment |
| B. | inflation |
| C. | consumption |
| D. | market |
| Answer» D. market | |
| 77. |
According to classical economists, variations in savings are due to: |
| A. | level of investment |
| B. | rate of interest |
| C. | level of employment |
| D. | none of the above |
| Answer» B. rate of interest | |
| 78. |
Supply creates its own demand is the Basis of: |
| A. | classical economics |
| B. | keynesian economics |
| C. | monetarism |
| D. | none of these |
| Answer» A. classical economics | |
| 79. |
Which policy is effective in the Keynesian range? |
| A. | monetary policy |
| B. | fiscal policy |
| C. | incomes policy |
| D. | none of these |
| Answer» B. fiscal policy | |
| 80. |
When output exceeds spending: |
| A. | there is unsold output, and level of output will fall |
| B. | there is unsold output, and level of output will rise |
| C. | there is unsold output, and level of spending will rise |
| D. | there is no unsold output since the level of spending will rise |
| Answer» A. there is unsold output, and level of output will fall | |
| 81. |
Entrepreneurs will have no tendency to expand or contract output and employment when |
| A. | ad>as |
| B. | ad<as |
| C. | ad=as |
| D. | none of the above |
| Answer» C. ad=as | |
| 82. |
The slope of the consumption function is called |
| A. | mpc |
| B. | mps |
| C. | apc |
| D. | aps |
| Answer» A. mpc | |
| 83. |
The concept of effective demand is associated with the name of |
| A. | marshall |
| B. | keynes |
| C. | krugman |
| D. | say |
| Answer» B. keynes | |
| 84. |
Psychological law of consumption states that the value of MPC is lies between zero and |
| A. | 1 |
| B. | 2 |
| C. | 3 |
| D. | 4 |
| Answer» A. 1 | |
| 85. |
Net investment is also known as |
| A. | depreciation |
| B. | induced investment |
| C. | autonomous investment |
| D. | capital formation |
| Answer» D. capital formation | |
| 86. |
In the saving function S = -a + (b)Y, the term ‘b’ denotes |
| A. | saving |
| B. | mpc |
| C. | mps |
| D. | aps |
| Answer» B. mpc | |
| 87. |
Who propounded Psychological law of consumption |
| A. | adam smith |
| B. | ricardo |
| C. | keynes |
| D. | pigou |
| Answer» C. keynes | |
| 88. |
When MPS = 0.2, MPC will be |
| A. | 0.8 |
| B. | 0.2 |
| C. | 1.2 |
| D. | 20 |
| Answer» A. 0.8 | |
| 89. |
In the linear consumption function C = a + bY, coefficient ‘a’ denotes |
| A. | mpc |
| B. | apc |
| C. | autonomous consumption |
| D. | induced consumption |
| Answer» C. autonomous consumption | |
| 90. |
In the equation C = 60 + 0.6 Y, MPC is |
| A. | 60 |
| B. | 0.6 |
| C. | 0 |
| D. | 1 |
| Answer» B. 0.6 | |
| 91. |
Keynes assumed the presence of --------- economy for the fundamental law of consumption |
| A. | capitalistic |
| B. | socialistic |
| C. | planned |
| D. | none of the above |
| Answer» A. capitalistic | |
| 92. |
Demand-pull inflation may be caused by: |
| A. | an increase in costs |
| B. | a reduction in interest rates |
| C. | a reduction in government spending |
| D. | an outward shift in aggregate supply |
| Answer» B. a reduction in interest rates | |
| 93. |
Inflation: |
| A. | always reduces the cost of living |
| B. | always reduces the standard of living |
| C. | reduces the price of products |
| D. | reduces the purchasing power of a rupee |
| Answer» D. reduces the purchasing power of a rupee | |
| 94. |
An increase in injections into the economy may lead to: |
| A. | an outward shift of aggregate demand and demand-pull inflation |
| B. | an outward shift of aggregate demand and cost-push inflation |
| C. | an outward shift of aggregate supply and demand-pull inflation |
| D. | an outward shift of aggregate supply and cost-push inflation |
| Answer» A. an outward shift of aggregate demand and demand-pull inflation | |
| 95. |
According to the Phillips curve, unemployment will return to the natural rate when: |
| A. | nominal wages are equal to expected wages |
| B. | real wages are back at long-run equilibrium level |
| C. | nominal wages are growing faster than inflation |
| D. | inflation is higher than the growth of nominal wages |
| Answer» B. real wages are back at long-run equilibrium level | |
| 96. |
What is the cause of inflation? |
| A. | if money supply increases. |
| B. | if the production rate falls. |
| C. | if money supply increases and production falls. |
| D. | both money supply and production decreases. |
| Answer» C. if money supply increases and production falls. | |
| 97. |
What does the inflation imply? |
| A. | rise in budget deficit |
| B. | rise in prices of consumer goods. |
| C. | rise in money supply. |
| D. | rise in general price index. |
| Answer» D. rise in general price index. | |
| 98. |
How the inflation can be checked temporarily? |
| A. | increase in money supply |
| B. | decrease in money supply |
| C. | increase in wages |
| D. | decrease in tax |
| Answer» B. decrease in money supply | |
| 99. |
Which groups are not protected from inflation? |
| A. | industrial worker |
| B. | agricultural farmers |
| C. | government pensioners |
| D. | saving bank account holders |
| Answer» B. agricultural farmers | |
| 100. |
Which of the following cannot be included among the remedies of inflation? |
| A. | better capacity utilization |
| B. | by making low bank rate |
| C. | by reducing budget deficit |
| D. | by making high bank rate |
| Answer» B. by making low bank rate | |
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