1. Macroeconomics as a separate branch came to be studied after the contributions of which
economist?
Correct : B. John Maynard Keynes
2. When did the Great Depression hit the United States?
Correct : B. 1929
3. Consider the following statements:
1. In a Capitalist economy there is private ownership of means of production 2. In a communist nation, the means of production are owned by the State 3. In a free-market economy there is minimum role of the Government Which of the above 3 statement is/are true?
Correct : D. All are true
4. Macroeconomics is a study of economics that deals with which 4 major factors:
Correct : B. households, firms, government and external sector
5. What are consumption goods?
Correct : C. Goods and services that are consumed fully when purchased by the consumers
6. What are Capital goods?
Correct : B. Goods such as tools, machinery, etc which are used to create final consumer goods
7. Intermediate goods are not included to calculate the final output because:
Correct : C. their value is included in final goods so they are not added to avoid the problem of double counting
8. What does the term Gross investment mean while denoting a nation's economy?
Correct : A. Gross investment= Net investment + Depreciation
9. What does the term free-market denote in terms of economy?
Correct : A. Minimal government intervention in trade and minimum regulations
10. ___________economics can study the problem of Inflation in the country.
Correct : B. Macro
11. The credit of development of macroeconomic approach must go to ________.
Correct : C. Lord Keynes
12. Macroeconomics does not study _________.
Correct : D. product pricing)
13. _________ is the subject matter of Macroeconomics.
Correct : A. Growth theory
14. Micro and Macro approaches are ________.
Correct : D. Complementary
15. For economists, statements about the world are of two types:
Correct : C. Positive statements and normative statements
16. The opportunity cost of going to university is:
Correct : D. The value of the best opportunity a student gives up to attend university
17. Statistics such as GDP, the unemployment rate, the rate of inflation and the trade balance are:
Correct : A. Macro, since they tell us something about the entire economy
18. What do you mean by a mixed economy?
Correct : B. Public and private sectors
19. “Capitalism” refers to?
Correct : C. Private ownership of capital goods
20. The average income of a country is called
Correct : A. Per capita income
21. The value of NNP at production point is called
Correct : A. NNP at factor cost
22. The value of NNP at consumer point is called the
Correct : B. NNP at market price
23. When depreciation is deducted from GNP, the net value is
Correct : A. Net national product (NNP)
24. Consider the following statements and identify the right ones.
i. While calculating GNP, income generated by foreigners in a country is taken into consideration ii. While calculating GNP, income generated by nationals of a country outside the country is taken into account
Correct : B. ii only
25. What is the net value of GDP after deducting depreciation from GDP(Gross domestic product)?
Correct : B. Net domestic product
26. Consider the following statements and identify the right ones.
i. National income is the monetary value of all final goods and services produced. ii. Depreciation is deducted from gross value to get the net value
Correct : C. both
27. Which of the following is considered as financial year in India?
Correct : A. April 1 to March 31
28. Which is not added in the calculation of national income of India?
Correct : D. Both [B] & [C]
29. Which sector contributes the most to India's economy in terms of GDP?
Correct : A. Service sector
30. Which Ministry is responsible for calculating GDP in India?
Correct : C. Ministry of Central Statistical and Program Implementation (Central statistical organization)
31. Which statement is true?
Correct : A. National Expenditure = National income
32. Which statement is true?
Correct : C. NI = NNP - indirect taxes (because, from NNP if we minus the indirect taxes it will give us NNP@FC which is equal to NI)
33. There are methods of measuring national income:
Correct : D. 3
34. If we compare GDP and GNP, then:
Correct : B. GNP = GDP + net income from abroad (R-P)……. GDP+(R-P)
35. Select the correct statement:
Correct : B. Depreciation allowance is a part of GNP
36. Which is the largest figure:
Correct : B. GNP
37. Which is a flow concept:
Correct : C. My monthly income
38. To avoid double counting when GDP is estimated, economists:
Correct : B. Calculate value added at each stage of production
39. Personal income includes:
Correct : A. Direct taxes
40. Personal income includes:
Correct : A. Transfer payments
41. If savings exceed investment then:
Correct : B. National income falls
42. This statement is true
Correct : A. NI = rent + interest + wages + profit
43. Which Ministry is responsible for calculating GDP in India?
Correct : C. Ministry of Central Statistical and Program Implementation
44. An Indian farmer produces wheat without incurring cost of inputs all sells for Rs. 1,000 to a miller who grinds wheat into flour and sells for Rs 1,200 to baker. The baker sells bread to consumers for Rs. 1,600. Total added is Rs.
Correct : A. 1,600
45. How much does the primary sector contribute to India's GDP?
Correct : B. 20%
46. Which sector contributes the most to India's economy?
Correct : A. Service sector
47. If the contribution of the agricultural sector is decreasing in a country's economy, then what
conclusion can be drawn?
Correct : A. The country is growing in the direction of being a developed nation
48. Which is not added in the calculation of national income of India?
Correct : D. Both b & c
49. Output means. ……………unless stated otherwise
Correct : A. Gross output at MP (GDPmp)
50. Which of the following is not a component of domestic income?
Correct : C. Net factor income from abroad
51. If factor cost is greater than marker price, it means that
Correct : A. Indirect taxes < subsidies (Subsidy> indirect taxes)
52. An Indian farmer produces wheat without incurring cost of inputs alll
sells for Rs. 1,000 to a miller who grinds wheat into flour and sells for Rs 1,200 to baker. The baker sells bread to consumers for Rs. 1,600. Total added is Rs.
Correct : A. 1,600
53. Which of the following is not true about final goods?
Correct : C. Final goods are subject to further transformation in the process of production.
54. Following is an example of final good:
Correct : B. Unsold stock of goods lying with the sellers
55. Which out of the following is not included in estimation of NI?
Correct : B. Old-age Pension
56. Which of the following is a synonym of “Undistributed Profits”?
Correct : D. All of these
57. Piyush’s mother is a teacher. She also teaches Piyush. How would you treat this white
calculating national income and domestic income?
Correct : D. It will neither be included in the domestic income nor in the national income.
58. Subsidy implies Selling the product
Correct : B. Below the cost of production.
59. Which of the following is correct?
Correct : D. None of the above.
60. Goods which are not used in the production of other goods are called:
Correct : B. Consumption goods
61. Depreciation is the:
Correct : D. All of these
62. Which of following is not included in national income?
Correct : D. Transfer income
63. Which of following is not a capital good?
Correct : C. Advocate’s Services
64. Which of following is not an intermediate goods?
Correct : C. Service of Doctor
65. Which of following is not a final good?
Correct : A. Machinery purchased by dealer
66. Which of following is not a part of national income?
Correct : A. Depreciation
67. Product method of calculating national income is also known as:
Correct : B. Value added method
68. Transfer payments refer to payments, which are made:
Correct : A. Without any exchange of goods and services
69. National Income differs from Net National Product at market price by the amount of:
Correct : B. Net Indirect Taxes (difference between Indirect tax and subsidy)
70. Net national product at factor cost is also known as:
Correct : C. National Income
71. In GNP calculation which of the following should be excluded?
Correct : D. Government transfer payment
72. National Income differs from Net National Product at market price by the amount of:
Correct : B. Net Indirect Taxes
73. Which property the paper money does not possess:
Correct : C. Durability
74. A saving account in a bank represents the function of money:
Correct : D. Store of value
75. A student records her income and spending for past month, she uses the function of money
Correct : D. Unit of account
76. It implements monetary policy of the country:
Correct : A. Central bank
77. Which property paper money does NOT Possess?
Correct : C. Durability
78. Anything used as money must be:
Correct : D. Readily acceptable
79. What will promote savings?
Correct : C. Increase in personal incomes
80. Liquidity of a monetary asset means:
Correct : C. Ready acceptability of monetary asset
81. Barter means:
Correct : D. Trade without use of money
82. Government securities:
Correct : D. (b) and (c) of above
83. Which is the characteristic of a good money:
Correct : D. Is readily accepted by people
84. This is NOT money
Correct : B. Prize bond
85. which of the following is true for Cross cheque?
Correct : D. None of the above
86. This is a characteristic of good money:
Correct : B. Liquidity
87. This is a characteristic of good money:
Correct : B. General acceptability
88. It is a kind of money:
Correct : A. Credit money
89. It is included in kinds of money:
Correct : D. All of the above
90. Treasury Bill is a document used for:
Correct : C. A short-term loan to the government
91. Which does NOT represent a method of payment?
Correct : B. Saving certificate
92. Which is NOT a desirable characteristic of money?
Correct : D. Easily duplicated
93. According to Keynes people demand money for purposes (motives):
Correct : C. 3
94. Speculative demand for money depends upon:
Correct : C. Rate of interest
95. If money supply in a country decrease:
Correct : B. Prices will fall
96. In the equation MV = PY, V represents:
Correct : B. Velocity of circulation of money
97. In the equation MV = PY, M represents:
Correct : A. Money supply
98. According to Keynes, motives for holding money are:
Correct : B. Three
99. Quantity Theory of Money explains that:
Correct : A. Value of money depends upon quantity of money