| 1. |
Demand for a commodity refers to: |
| A. | Need for the commodity |
| B. | Desire for the commodity |
| C. | Amount of the commodity demanded at a particular price and at a particular time |
| D. | Quantity demanded of that commodity |
| Answer» C. Amount of the commodity demanded at a particular price and at a particular time | |
| 2. |
If the demand for a good is inelastic, an increase in its price will cause the total expenditure of the consumers of the good to: |
| A. | Increase |
| B. | Decrease |
| C. | Remain the same |
| D. | Become zero |
| Answer» A. Increase | |
| 3. |
Income elasticity of demand is defined as the responsiveness of: |
| A. | Quantity demanded to a change in income |
| B. | Quantity demanded to a change in price |
| C. | Price to a change in income |
| D. | Income to a change in quantity demanded |
| Answer» A. Quantity demanded to a change in income | |
| 4. |
The supply of a good refers to: |
| A. | Stock available for sale |
| B. | Total stock in the warehouse |
| C. | Actual Production of the goo |
| D. | D. Quantity of the good offered for sale at a particular price per unit of time |
| Answer» D. D. Quantity of the good offered for sale at a particular price per unit of time | |
| 5. |
In the short run, when the output of a firm increases, its average fixed cost: |
| A. | Remains constant |
| B. | Decreases |
| C. | Increases |
| D. | First decreases and then rises |
| Answer» B. Decreases | |
| 6. |
The cost of one thing in terms of the alternative given up is called: |
| A. | Real cost |
| B. | Production cost |
| C. | Physical cost |
| D. | Opportunity cost |
| Answer» D. Opportunity cost | |
| 7. |
In which of the following market structure is the degree of control over the price of its product by a firm very large? |
| A. | Imperfect competition |
| B. | Perfect competition |
| C. | Monopoly |
| D. | In A and B both |
| Answer» C. Monopoly | |
| 8. |
Demand for factors of production is: |
| A. | Derived demand |
| B. | Joint demand |
| C. | Composite deman |
| D. | D None of the above |
| Answer» A. Derived demand | |
| 9. |
The producer’s demand for a factor of production is governed by the ___ of that factor. |
| A. | Price |
| B. | Marginal productivity |
| C. | Availability |
| D. | Profitability |
| Answer» B. Marginal productivity | |
| 10. |
Who is the ‘lender of the last resort’ in the banking structure of India? |
| A. | State Bank of India |
| B. | Reserve Bank of India |
| C. | EXIM Bank of India |
| D. | Union Bank of India |
| Answer» B. Reserve Bank of India | |
| 11. |
____ is the official minimum rate at which the Central Bank of a country is prepared to rediscount approved bills held by the commercial banks. |
| A. | Repo rate |
| B. | Bank rate |
| C. | Prime lending rate |
| D. | Reverse repo rate |
| Answer» B. Bank rate | |
| 12. |
Which among the following is a function of the Reserve Bank of India? |
| A. | Bank issues the letters of credit to their customers certifying their creditability |
| B. | Collecting and compilation of statistical information relating to banking & other financial sectors |
| C. | Banks under write the securities issued by public or private organizations |
| D. | Accepting deposits from the public |
| Answer» B. Collecting and compilation of statistical information relating to banking & other financial sectors | |
| 13. |
The following is the direct tax among: |
| A. | House tax |
| B. | Entertainment tax |
| C. | Service tax |
| D. | Value added tax |
| Answer» A. House tax | |
| 14. |
Which among the following is a cause of inflation? |
| A. | Deficit financing |
| B. | Rise in external loans |
| C. | Unfavorable balance of payment |
| D. | A hike in the CRR by the central bank of the country |
| Answer» A. Deficit financing | |
| 15. |
The capital that is consumed by an economy or a firm in the production process is known as: |
| A. | Capital loss |
| B. | Production cost |
| C. | Dead-weight loss |
| D. | Depreciation |
| Answer» D. Depreciation | |
| 16. |
Which of the following is also known as International Bank for Reconstruction and Development? |
| A. | Asian Development Bank |
| B. | World Bank |
| C. | Reserve Bank of India |
| D. | International Monetary Fund |
| Answer» B. World Bank | |
| 17. |
A change in fiscal policy affects the balance of payments through: |
| A. | The current account only |
| B. | The capital account only |
| C. | Both, the current account and capital account |
| D. | Neither current account nor capital account |
| Answer» C. Both, the current account and capital account | |
| 18. |
Fiscal Policy means: |
| A. | Policy relating to money and banking in a country |
| B. | Policy relating to non-banking financial institutions |
| C. | Policy relating to government spending’ taxation and borrowing |
| D. | Policy relating to financial matters of international trade |
| Answer» C. Policy relating to government spending’ taxation and borrowing | |
| 19. |
Which one of the following is NOT the objective of fiscal policy of government of India? |
| A. | Full employment |
| B. | Price stability |
| C. | Regulation of inter-state trade |
| D. | Economic growth |
| Answer» C. Regulation of inter-state trade | |
| 20. |
Monetary policy is implemented by in India. |
| A. | The Ministry of Finance |
| B. | Planning Commission |
| C. | The Parliament |
| D. | Reserve Bank of India |
| Answer» D. Reserve Bank of India | |
| 21. |
The most simple and popular method of measuring economic development is to calculate the trend of gross national product (GNP) at __________ |
| A. | Current prices |
| B. | Constant prices |
| C. | Both of the above |
| D. | None of the above |
| Answer» B. Constant prices | |
| 22. |
By __ growth rate of an economy can be speeded up. |
| A. | Investment in share market |
| B. | Investment abroad |
| C. | Investment in human capital formation |
| D. | Investment in primary sector |
| Answer» C. Investment in human capital formation | |
| 23. |
When national income is calculated with reference to a base year, it is called: |
| A. | Nominal national income |
| B. | Net national income |
| C. | Real national income |
| D. | Gross national income |
| Answer» C. Real national income | |
| 24. |
Which market structure symbolizes the existence of ‘few sellers’? |
| A. | Oligopoly |
| B. | Monopoly |
| C. | Monopolistic competition |
| D. | Perfect competition |
| Answer» A. Oligopoly | |
| 25. |
Which among the following are the factors that determine the national income of a country? |
| A. | Quantity and Quality of factors of production |
| B. | The state of technical knowledge |
| C. | Economic and political stability |
| D. | All of the above |
| Answer» D. All of the above | |
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