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

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Free Download as PDF Economics Quiz Questions and Answers for Competitive Exams or solved MCQs with answers. These quiz objective questions are helpful for competitive exams SSC, UPSC, IAS, IPS, CDS, NDA, Railways or RRB, psc exams of Andhra Pradesh, Arunachal Pradesh, Assam, Bihar, Gujarat, Haryana, Himachal Pradesh, Jammu & Kashmir, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Manipur, Meghalaya, Mizoram, Nagaland, Orissa, Punjab, Rajasthan, Sikkim, Tamil Nadu, Tripura, Uttar Pradesh, West Bengal, Chhattisgarh, Uttarakhand, Jharkhand, Telangana etc.
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(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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