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Economics Questions and Answers for Competitive Exams | Indian Economy Quiz Set 38

Questions
1 Given that LM function is Y = 100 + 10i and the IS function is Y = 160 – 20i, find the correct value of equilibrium level of income and rate of interest from the given options.
1 120 and 2
2 90 and 3
3 150 and 2
4 120 and 3

Answer:120 and 2
2 Who distinguished between value in use and value in exchange and gave the famous example of diamonds and water ?
1 Adam Smith
2 David Ricardo
3 Alfred Marshall
4 Karl Marx

Answer: Adam Smith
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3 Predatory pricing policy is designed to
1 drive competitors out of business
2 maximise profits
3 encourage entrants into the market
4 attain least cost output

Answer:drive competitors out of business
4 When income effect becomes stronger than substitution effect, the labour supply curve will
1 Slope positively
2 Negatively sloped
3 Bend backward
4 Slope upwards

Answer: Bend backward
5 An industry whose long run supply curve is horizontal is called
1 Constant cost industry
2 Increasing Cost Industry
3 Decreasing Cost Industry
4 Efficient Industry

Answer:Constant cost industry
6 The practice of charging each consumer the reservation price is called
1 Peak load pricing
2 Inter-temporal price discrimination
3 First degree price discrimination
4 Third degree price discrimination

Answer:Lack of capital account convertibility
7 Frictional unemployment is also known as
1 Disguised unemployment
2 Turnover unemployment
3 Cyclical unemployment
4 Structural unemployment

Answer: Turnover unemployment
8 The full capacity growth rate in Harrod-Domar Model is also known as
1 Actual growth rate
2 Warranted growth rate
3 Natural growth rate
4 Expected growth rate

Answer:Warranted growth rate
9 Meetingthe needs of present generation without compromising the needs of future generation is
1 Economic Development
2 Social Development
3 Sustainable Development
4 Economic Growth

Answer:Economic Growth
10 Single out the activity that is not included in the Industrial Production Index of India :
1 Manufacturing
2 Construction
3 Mining
4 Electricity

Answer:Construction
11 High growth of which industry provides a positive signal for industrial growth in future ?
1 Capital goods industries
2 Basic goods industries
3 Durable consumer goods industries
4 Intermediate goods industries

Answer: Capital goods industries
12 An example of a Euro currency is
1 a dollar deposit outside the U.S.
2 a pound sterling deposit within UK
3 a mark deposit with Germany
4 All of the above

Answer:a dollar deposit outside the U.S.
13 Which of the following tax has ‘announcement effect’ ?
1 Income tax
2 Excise Duties
3 Property tax
4 Capital gains taxation

Answer:Excise Duties
14 Given arithmetic mean = 45, mode = 48, then median =
1 45
2 48
3 49
4 46

Answer:46
15 If two events A and B are mutually inclusive, then P(A or B) is
1 P(A) + P(B) – P(AB)
2 P(A) + P(B) + P(AB)
3 P(A) + P(B)
4 P(A) P(B)

Answer:P(A) + P(B)

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