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Economics Questions and Answers for Competitive Exams | Indian Economy Quiz Set 15

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Questions
1 Who among the following is not associated with the compensation principle of welfare economics ?
1 Kaldor
2 Hicks
3 Scitokosky
4 Pareto

Answer:Pareto
2 Substitution of leisure for income leads to
1 Backward sloping supply curve
2 Need for overtime payment
3 Both (1) and (2)
4 Neither (1) nor (2)

Answer: Both (1) and (2)
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3 Which of the following describes the Lemons problem in economies ?
1 Bad currency drives out the good currency.
2 Low-quality goods can drive high quality goods out of the market
3 Low cost firms drive out high cost firms from the market.
4 Excess production of a horticulture crop.

Answer:Bad currency drives out the good currency.
4 Assuming that firm A increases its advertising and firm B responds by increasing its advertising. If profits of both firms increase, then firms A and B are engaged in
1 a zero-sum game
2 a positive-sum game
3 a negative-sum game
4 behaviour which cannot be understood in terms of games theory

Answer:`behaviour which cannot be understood in terms of games theory
5 Changes in the portfolio assets of the people take place due to
1 Current rate of interest
2 Future rate of interest
3 Current rate of interest in relation to future rate of interest
4 Current price of bonds

Answer:Current rate of interest in relation to future rate of interest
6 Which among the following measures the intensity of poverty ?
1 Head Count Ratio of Poverty
2 Poverty Gap
3 Square of Poverty Gap
4 Per Capita Income

Answer:Square of Poverty Gap
7 Which among the following has not been declared as a special category State in India ?
1 Uttarakhand
2 Bihar
3 Jammu & Kashmir
4 Himachal Pradesh

Answer:Bihar
8 In the context of project evaluation, the net present value method mainly depends upon :
1 interest rate prevalent at a given time
2 exchange rate prevalent at a given time
3 sales tax rate prevalent at a given time
4 both income and sales tax rates prevalent at a given time

Answer: interest rate prevalent at a given time
9 Which among the following economists advocated the use of social marginal productivity criterion ?
1 Hollis B. Chenery
2 A.K. Sen
3 Maurice Dobb
4 J.J. Polak

Answer:Hollis B. Chenery
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10 Trickle down strategy explains process associated with which of the following economic systems ?
1 Capitalist system
2 Socialist system
3 Mixed economy
4 Both (1) and (3)

Answer:Both (1) and (3)
11 Who among the following is not a regulator of financial sector in India ?
1 Securities and Exchange Board of India
2 Insurance Regulatory and Development Authority
3 Competition Commission of India
4 Forward Market Commission of India

Answer:Competition Commission of India
12 Dumping in international trade means that a country
1 exports all the domestic production of a commodity
2 imports a commodity at a very low price
3 exports a commodity at a price less than its cost of production
4 exports a commodity at a price equal to its cost of production

Answer:exports a commodity at a price less than its cost of production
13 International trade in goods and services is sometimes used as a substitute for all of the following, except
1 international movement of capital
2 international movement of labour
3 domestic production of same goods and services
4 domestic production of different goods and services

Answer:international movement of labour
14 If the elasticities of supply of exports and imports are large in relation to the elasticity of demand for exports and imports, devaluation of a country's currency will :
1 not effect the terms of trade
2 worsen the terms of trade
3 improve the terms of trade
4 All of the above

Answer:improve the terms of trade
15 Uruguay Round of negotiations concerned with which among the following ?
1 Tariff Measures
2 Non-Tariff Measures
3 Both (1) and (2)
4 Neither (1) nor (2)

Answer:Both (1) and (2)

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