Economics Questions and Answers - Set 14 | Indian Economy Solved Multiple Choice Questions(MCQs)

1 In the terminology of WTO, which among the following is not an amber box subsidy ?

1 Minimum support price of cereals

2 Subsidy on seeds

3 Subsidy on irrigation rates

4 Cost of government pest control and management

Answer: Cost of government pest control and management

2 The weight of manufacturing in old IIP (base 1993-94) was 76.36% which has now been changed in the new IIP (base 2004-05) at

1 75.53%

2 Unchanged at 76.36%

3 78.22%

4 79.39%

View Answer

Answer: 75.53%

3 Which of the following agricultural holdings have largest percentage in India ?

1 Marginal Holdings

2 Small Holdings

3 Large Holdings

4 Semi-Medium Holdings

View Answer

Answer:Marginal Holdings

4 First two States/Regions in India having highest yield of rice in 2013-14 were

1 National Capital Territory of Delhi and Punjab

2 Punjab and West-Bengal

3 Andhra Pradesh and Haryana

4 Punjab and Uttar Pradesh

View Answer

Answer:`National Capital Territory of Delhi and Punjab

5 Which among the following rates is independently determined in India ?

1 Repo rate

2 Reverse repo rate

3 Both (1) and (2)

4 Neither (1) nor (2)

View Answer

Answer:Repo rate

6 The main objectives of the 12th Five Year Plan are

1 inclusive growth and poverty reduction

2 inclusive and sustainable growth

3 Faster, sustainable and more inclusive growth

4 Sustainable and inclusive growth to reduce poverty and unemployment

View Answer

Answer:Faster, sustainable and more inclusive growth

7 Which of the following are not considered as flow variables in economic analysis ?

1 Supply and demand

2 Saving and investment

3 Money supply and public debt

4 Exports and imports

View Answer

Answer:Money supply and public debt

8 If the Reserve Bank of India wishes to decrease the money supply, it should

1 buy treasury bills in the open market

2 raise statutory liquidity ratio

3 raise the discount rate

4 lower the reserve requirements

View Answer

Answer: buy treasury bills in the open market

9 Which of the following is included in M1 ?

1 Savings deposits

2 Demand deposits

3 Gold stock

4 Assets under money market mutual funds

View Answer

Answer: Demand deposits

10 The production function Q = 150 L0.7 K05, exhibits the returns to scale as :

1 Constant

2 Increasing

3 Decreasing

4 Fluctuating

View Answer

Answer:Increasing

11 Indirect least squares method of estimation is applied to equations of a simultaneous equation system. The estimates so obtained will be

1 Unbiased and consistent

2 Biased and inconsistent

3 Biased and consistent

4 Unbiased and inconsistent

View Answer

Answer:Unbiased and consistent

12 In a two-variable regression Y is dependent variable and X is independent variable. If the correlation coefficient between Y and X is 0.7, then which one of the following result is correct ?

1 7% variations in Y are explained by X.

2 70% variations in Y are explained by X.

3 49% variation in Y are explained by X.

4 0.7% variations in Y are explained by X.

View Answer

Answer: 49% variation in Y are explained by X.

13 Koyck’s approach to econometric analysis deals with relationships involving :

1 Lagged explanatory variables

2 Qualitative explanatory variables

3 Exponential explanatory variables

4 None of the above

View Answer

Answer:Qualitative explanatory variables

14 For the demand function P = 10 – 2x – 0.5 x2, what is price elasticity of demand at x = 2 ?

1 Zero

2 0.5

3 1

4 1.5

View Answer

Answer:0.5

15 In a regression with 3 independent variables and 20 observations F value calculated is to be tested. What will be degrees of freedom for numerator and denominator in testing procedure ?

1 2, 18

2 3, 17

3 3, 16

4 3, 20

View Answer