McqMate
These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Bachelor of Commerce (B Com) .
Chapters
| 101. |
Cross cheque means: |
| A. | It has been cancelled |
| B. | Cash cannot be directly drawn from the bank |
| C. | It has two lines drawn in left upper corner |
| D. | (b) and (c) of above |
| Answer» D. (b) and (c) of above | |
| 102. |
Purchasing power of money during deflation is: |
| A. | Reduced |
| B. | Increased |
| C. | Constant |
| D. | Fluctuating |
| Answer» B. Increased | |
| 103. |
Velocity of circulation of money means the number of times a unit of money |
| A. | Changes hands daily |
| B. | Changes hands monthly |
| C. | Changes hands annually |
| D. | Changes purchasing power |
| Answer» C. Changes hands annually | |
| 104. |
The equation of exchange PT = MV was given by: |
| A. | Fisher |
| B. | Crowther |
| C. | Kuznets |
| D. | Keynes |
| Answer» A. Fisher | |
| 105. |
When value of money falls, they benefit more: |
| A. | Farmers |
| B. | Industrialist |
| C. | Lenders |
| D. | Debtors |
| Answer» D. Debtors | |
| 106. |
When the nation's money supply is Rs. 1200 billion and GDP is Rs. 4800 billion, velocity of circulation money is: |
| A. | 0.25 |
| B. | 4 |
| C. | 0.4 |
| D. | 4 billion rupees |
| Answer» B. 4 | |
| 107. |
Which one is equation of exchange? |
| A. | PT = MV |
| B. | PV = MT |
| C. | PM = TV |
| D. | None of these |
| Answer» A. PT = MV | |
| 108. |
Inflation can be controlled by applying: |
| A. | Monetary and fiscal policies |
| B. | Monetary and Labour policy |
| C. | Fiscal and commercial policies |
| D. | All of the above |
| Answer» A. Monetary and fiscal policies | |
| 109. |
Inflation is a situation when: |
| A. | Prices of some goods rise |
| B. | General price level rises continuously |
| C. | Prices double every year |
| D. | Prices rise and fall |
| Answer» B. General price level rises continuously | |
| 110. |
Under normal circumstances, the velocity of circulation of money in a country is: |
| A. | 100% |
| B. | Negative |
| C. | Less than 10 |
| D. | Zero |
| Answer» C. Less than 10 | |
| 111. |
According to Keynes, demand for money is affected by: |
| A. | Income |
| B. | Rate of interest |
| C. | Literacy rate |
| D. | Both (a) & (b) |
| Answer» D. Both (a) & (b) | |
| 112. |
During inflation: |
| A. | Lenders lose, borrowers gain |
| B. | Borrowers lose, lenders gain |
| C. | Borrowers and lenders both lose |
| D. | All sections of the society gain |
| Answer» A. Lenders lose, borrowers gain | |
| 113. |
The quantity demanded of money rises: |
| A. | As the interest rises |
| B. | As the interest rate falls |
| C. | As the supply of money falls |
| D. | As the number of banks rises |
| Answer» B. As the interest rate falls | |
| 114. |
Which people are most likely to gain during inflation? |
| A. | Those living on pension |
| B. | Those living on their savings |
| C. | Those who are repaying borrowed money |
| D. | Those who have lent money |
| Answer» C. Those who are repaying borrowed money | |
| 115. |
If quantity of money increases 100%, other things remaining constant, value of money changes by: |
| A. | Increases by 100% |
| B. | Decreases by 100% |
| C. | Decreases by 200% |
| D. | Does not change |
| Answer» B. Decreases by 100% | |
| 116. |
For the economy, prices are beneficial: |
| A. | Falling slowly |
| B. | Rising slowly |
| C. | Rising fast |
| D. | Falling fast |
| Answer» B. Rising slowly | |
| 117. |
Value of money means: |
| A. | Gold purchased by money |
| B. | General purchasing power of money |
| C. | Importance of money |
| D. | Demand for money |
| Answer» B. General purchasing power of money | |
| 118. |
Value of money and supply of money are related: |
| A. | Inversely |
| B. | Directly |
| C. | Govt. law |
| D. | Are not related |
| Answer» A. Inversely | |
| 119. |
They are not affected badly by rising prices: |
| A. | Salaried persons |
| B. | Businessmen |
| C. | Debtors |
| D. | Importers |
| Answer» B. Businessmen | |
| 120. |
Inflation: |
| A. | Makes distribution of income equal |
| B. | Makes distribution of income unequal |
| C. | Has no effect on distribution of income |
| D. | Affects only industrial sector |
| Answer» B. Makes distribution of income unequal | |
| 121. |
It is assumption of quantity theory of money: |
| A. | Quantity of traded goods increases |
| B. | Velocity of circulation of money constant |
| C. | Govt. imposes new taxes |
| D. | (a) and (b) of the above |
| Answer» B. Velocity of circulation of money constant | |
| 122. |
If we put this letter in the blank space, we get quantity theory of money PY = M |
| A. | S |
| B. | T |
| C. | V |
| D. | A |
| Answer» C. V | |
| 123. |
In the equation PY = MV showing quantity theory of money. Y represents: |
| A. | Year of measurement of national income |
| B. | National income |
| C. | Tax revenue of the govt |
| D. | (a) and (c) of above |
| Answer» B. National income | |
| 124. |
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 | |
| 125. |
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 | |
| 126. |
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 | |
| 127. |
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 | |
| 128. |
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. | |
| 129. |
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. | |
| 130. |
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 | |
| 131. |
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 | |
| 132. |
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 | |
| 133. |
What is Cost-Push inflation? |
| A. | Increasing money supply |
| B. | Increasing indirect tax |
| C. | Population increase |
| D. | expenditure increase unnecessarily. |
| Answer» B. Increasing indirect tax | |
| 134. |
Inflation is the state in which .............................. |
| A. | The value of money decreases |
| B. | The value of money increases |
| C. | The value of the money increases first and then decreases |
| D. | The value of money decreases first and increases later |
| Answer» A. The value of money decreases | |
| 135. |
Which of the following class will not be negatively affected by the higher inflation? |
| A. | The consumer class |
| B. | The debtor class |
| C. | Pensioner class |
| D. | Business class |
| Answer» D. Business class | |
| 136. |
Which of the following is an effect of inflation? |
| A. | Erosion in purchasing power |
| B. | Affects relative price of goods |
| C. | Increase in inequalities of income |
| D. | All the above |
| Answer» D. All the above | |
| 137. |
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 | |
| 138. |
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 | |
| 139. |
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 | |
| 140. |
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 | |
| 141. |
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 | |
| 142. |
“Supply creates its own demand “is a law of: |
| A. | Investment |
| B. | Inflation |
| C. | Consumption |
| D. | Market |
| Answer» D. Market | |
| 143. |
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 | |
| 144. |
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 | |
| 145. |
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 | |
| 146. |
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 | |
| 147. |
Saving is a function of |
| A. | Export |
| B. | Import |
| C. | Investment |
| D. | Income |
| Answer» D. Income | |
| 148. |
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 | |
| 149. |
The slope of the consumption function is called |
| A. | MPC |
| B. | MPS |
| C. | APC |
| D. | APS |
| Answer» A. MPC | |
| 150. |
The concept of effective demand is associated with the name of |
| A. | Marshall |
| B. | Keynes |
| C. | Krugman |
| D. | Say |
| Answer» B. Keynes | |
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