ICAR NET: Economics MCQs (Practice_Test 23 of 122)

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  1. Theory of growth developed by Schumpeter gives importance to the

    1. need for balanced growth

    2. development of infrastructure

    3. Role managers

    4. role innovations

  2. Despite beings a high saving economy, a developing country may still NOT grown fast primarily due to

    1. week administrative machinery

    2. Illiteracy

    3. High population density

    4. high capital-output ratio

  3. Hick's neutral technical change implies that

    1. the unit isoquant undergoes a parallel shift upwards

    2. the unit isoquant undergoes a parallel shift downwards

    3. curvature of the unit isquant changes.

    4. None of the above:

  4. Capital deepening means

    1. using larger amount of labour as compared to capital

    2. using more of the same type of capital due to increase we number of workers.

    3. increase in capital per worker in already existing production.

    4. using more of human capital

  5. Which one of the following pairs of economists and doctrines they advocated, is correctly matched?

      • A W Lewis
      • ‘Big Push’ theory
      • A O Hirschman
      • Strategy of unbalanced growth
      • Rosenstein
      • Rodan; stages of economic growth
      • W W Rostow
      • Theory of development with unlimited supplies of labour
  6. If the marginal productivity of labour in agriculture is zero than the labour supply curve for industry as assumed by

    1. upward rising

    2. perfectly elastic

    3. backward banding

    4. perfectly elastic

    5. perfectly elastics

  7. Consider the following statements: Harrod'Domar growth model implies constant.

    1. rate of population growth

    2. output

    3. rate of saving

    4. capital-output ratio

    Of these statements.

    1. 4 alone is correct

    2. I qand2 are correct

    3. 1, 2 and 3 are correct

    4. 1, 3 and 4 are correct.

  8. Demonstration effect means

    1. effect of advertisement

    2. imitating effect of consumption

    3. effect entertainment

    4. effect of a experiment NOT correct?

  9. Which one of the statements given below the diagram NOT correct?

    1. M (Y) represents imports as a function of national income

    2. M (Y) does not pass through the origin ‘O’ because at zero national income some imports may still bought form abroad out of reserves.

    3. The marginal propensity to import is the slope of M (Y)

    4. M (Y) is a straight line indicating that expenditure increases in proportion to increase in national income.

  10. In word, with only two goods, X and Y, and the full employment of factors, a rise in the price of a a commodity, x, leads to

    1. an increase in the real reward of the factor used intensively in the production of X

    2. a decrease in the real reward of the factor used less intensively in the production of Y

    3. an increase in the real reward of the factor used less intensively in the production of X

    4. an increase in the real reward of the factor used more intensively in the production of Y

  11. Which of the following are the functions of WTO?

    1. to provide a forum for trade negotiations.

    2. to administer the WTO agreement.

    3. to settle the disputes among members.

    4. To coordinate with IMF and IBRD in the formulation of global economic policies.

    Select the correct answer using the codes given below:

    1. 1, 2 and 3

    2. 1, 2, 3 and r

    3. 1 and 3

    4. 2 and 4

  12. The infant industry argument is often advocated in the context of

    1. price discrimination

    2. product diversification

    3. protection

    4. resource mobilisation.

  13. Under which of the following conditions will there be the possibility of trade between tow countries whose factor endowments are identical?

    1. When there are differences in tastes and preferences of the consumers in the tow countries.

    2. when the4re are differences in commodity prices in the two countries.

    3. When cost of production of different commodities differs between the two countries

    4. When production functions of the same goods are identical in the two countries.

  14. A tariff will not have any effect on revenue if the duty imposed is

    1. 50%

    2. 100%

    3. non-prohibitie

    4. prohibitive

  15. Which one of the following statements in NOT correct in respect of the given diagram?

    1. identical tastes with identical factor endowments an increasing returns.

    2. trade with identical endowments, identical tastes an diminishing returns.

    3. After trade begins and producers in both countries have become aware of the possibilities of economies scale, production possibility curve at either A or B.

    4. trade between the two countries would enable each country to reach higher indifference curve at point P