Punjab PSC Exam: Economics MCQs (Practice_Test 7 of 122)

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  1. In economics the central problem is:
    1. money.
    2. roduction.
    3. allocation.
    4. consumption.
    • Assertion (A) : The production function, z = 3 r, 1, + 2r2 + 2, where the ‘z’ is the output and r1 and r2 are the tow inputs not homogeneous.
    • Reason (R) : Multiplying r + 1 and 42 by a constant in the given production does not multiply ‘z’ by K.
    1. Both A and R are true and R is the correct explanation of A
    2. Both A and R are 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
    • Assertion (A) : According to Arrow, democratic decision-making is not possible.
    • Reason (R) : Majority rule can lead to a pattern social choices which is not transitive even though every voter has transitive preferences.
    1. Both A and R are true and R is the correct explanation of A
    2. Both A and R are 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
    • Assertion (A) : A rise in the aggregate demand a and aggregate supply of goods and service raises national income.
    • Reason (R) : National income represents the value of aggregate production in monetary term.
    1. Both A and R are true and R is the correct explanation of A
    2. Both A and R are 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
    • Assertion (A) : In India, liberalization policy implies a package of reforms which may not help to achieve the social objectives such as removal of poverty and unemployment.
    • Reason (R) : Benefits from the package of reforms will take quite some time to percolate down to the masses.
    1. Both A and R are true and R is the correct explanation of A
    2. Both A and R are 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
    • Assertion (A) : According to Schumpeter, development is a spontaneous and discontinuous change in the channels of the circular flow.
    • Reason (R) : The entrepreneur is the agent of this change.
    1. Both A and R are true and R is the correct explanation of A
    2. Both A and R are 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
    • Assertion (A) : It is possible to control either the money supply or the rate of interest but not the both.
    • Reason (R) : Other things remaining the same, the demand for money depends inversely on the rate of interest.
    1. Both A and R are true and R is the correct explanation of A
    2. Both A and R are 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
    • Assertion (A) : A progressive income tax is based on equimarginal sacrifice.
    • Reason (R) : Higher the income, lower will be the marginal utility of money for the tax payer.
    1. Both A and R are true and R is the correct explanation of A
    2. Both A and R are 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
    • Assertion (A) : In the recent pas, there has been a significant increase in the foreign exchange reserves of India.
    • Reason (R) : The new economic policy has provided incentive for foreign direct investment.
    1. Both A and R are true and R is the correct explanation of A
    2. Both A and R are 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
    • Assertion (A) : If the process of economic development is to be sustained, it is presupposed that the additional labour force in the subsistence sector shifts to the organized sector.
    • Reason (R) : The organized sector can expand its dimensions only through the additional labour force.
    1. Both A and R are true and R is the correct explanation of A
    2. Both A and R are 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
    • Assertion (A) : Trade unionsim in India is characterised by multiplicity of unions with intra and inter union rivalries.
    • Reason (R) : Trade unions are segmented along political lines dominated by outside leadership.
    1. Both A and R are true and R is the correct explanation of A
    2. Both A and R are 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
    • Assertion (A) : India՚s debt servicing burden is not as precarious as that of some of the Latin American countries.
    • Reason (R) : Concessional debt accounts for a large proportion of India՚s external debt.
    1. Both A and R are true and R is the correct explanation of A
    2. Both A and R are 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

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