Competitive Exams: Economics MCQs (Practice-Test 84 of 122)

  1. Which one of the following statements is correct? Crowding out in an economy can be avoided if

    1. government finances its expenditure by new money supply

    2. government finances its expenditure by taxes

    3. government finances its expenditure by buying outstanding bonds

    4. government finances its expenditure by raising cash reserve ratio

  2. Which one of the following statements is correct? According to Say's law of market

    1. demand creates its own supply

    2. supply creates its own demand

    3. demand and supply are always equal

    4. demand and supply are never equal

  3. Which one of the following statements in respect of the National Income Accounting is correct?

    1. Budget deficit is equal to savingsinvestment gap

    2. Budget deficit is more than savingsinvestment gap

    3. Budget deficit is less than savingsinvestment gap

    4. Budget deficit is always zero

  4. Which of the following is/are included in National Income Accounting?

    1. Purchase of shares and bonds.

    2. Value of residential investment.

    3. Value of production for self consumption.

    4. Value of intermediate goods.

    Select the correct answer by using the codes given below:

    1. 1 and 2

    2. 2 only

    3. 2 and 3

    4. 3 and 4

  5. Consider the following statements

    1. The equilibrium between the aggregate demand and aggregate supply may take place at a point of less-than-full employment in an economy.

    2. The size of deficient demand is inversely proportional to the deflationary gap.

    Which of the statements given above is/are correct?

    1. 1 only

    2. 2 only

    3. Both 1 and 2

    4. Neither 1 nor 2

  6. Among the items of export of agricultural and allied products from India during the year 2005 − 06, which one of the following was the highest in the value terms?

    1. Tea

    2. Coffee

    3. Rice

    4. Marine products

  7. Consider the following important sources of tax revenue for the Central Government

    1. Corporation tax

    2. Taxes on income other than corporation tax

    3. Union excise duties

    4. Service tax

    Which one of the following is the correct order of the aforesaid taxes in descending order in terms of their yield as proposed in the Union Budget 2006 − 07?

    1. 1 − 2 − 3 − 4

    2. 1 − 3 − 2 − 4

    3. 2 − 3 − 1 − 4

    4. 4 − 2 − 3 − 1

  8. The Twelfth Finance Commission has recommended States share in the divisible pool of taxes at what percentage?

    1. 26.5 percent

    2. 28.5 percent

    3. 29.5 percent

    4. 30.5 percent

  9. Consider the following statements about the National Agricultural Insurance Scheme (NATS):

    1. The scheme has been implemented from Rabi 1999 − 2000 season.

    2. The scheme is available to non-loanee farmers only.

    Which of the statements given above is/are correct?

    1. 1 only

    2. 2 only

    3. Both 1 and 2

    4. Neither 1 nor 2

  10. Which category of the target groups is not included in the SHG bank linkage programme for micro-finance to agriculture?

    1. Unemployed non-agricultural labourers

    2. Agricultural and non-agricultural labourers

    3. Small and marginal farmers

    4. Artisans and craftsmen

  11. Consider the following components of money supply in India

    1. Currency in circulation.

    2. Banker's deposits with the RBI.

    3. Other deposits with the RBI

    4. Demand deposits of banks

    Which of the above are the components of

    Reserve Money?

    1. 1 and 3

    2. 1, 2 and 3

    3. 1, 2 and 4

    4. 2, 3 and 4

  12. Which one of the following is the correct expression for the actual rate of growth (g) (Where s = the ratio of saving to income c = actual incremental capital-output ratio)?

    1. g = s/c

    2. g = s x c

    3. g = s + c

    4. g = se

  13. Inverted-U hypothesis of Kuznets is associated with movement of which one of the following?

    1. Consumption inequality

    2. Wealth inequality

    3. Income inequality

    4. Tax inequality

  14. Consider the following statements for Indian Millennium Deposits (IMDs) scheme.

    1. The scheme was launched by the Reserve Bank of India.

    2. It was intended for NRIs and resident Indians both.

    3. The tenure of IMDs was 5 years.

    Which of the statements given above is/are correct?

    1. 3 only

    2. 2 only

    3. 1 and 2

    4. 2 and 3

    • Assertion (A): An oligopolist faces demand curve which has a kink at the level of the prevailing price.
    • Reason (R): The segment of the demand curve above the prevailing price level or kink is highly inelastic and the segment of the demand curve below the prevailing price level is elastic.

    Codes:

    1. Both A and R are individually true and R is the correct explanation of A

    2. Both A and R are individually true but R is not the correct explanation of A

    3. A is true but R is false

    4. A is false but R is true