|Economics MCQ Questions with Answer|
Q1. Devaluation usually causes the internal price to
(d)None of these
Q2. Which of the following is not an example of economic overheads?
(c)Roads and Railways
Q3. Which is not included in the private income arising in a country?
(a) Factor income from net domestic product
(b) Net factor income from abroad
(c) Current transfers from government
(d) Current payments on foreign loans
Q4. In an economy, the sectors are classified into public and private on the basis of
(a) Employment condition
(b) Nature of economic activities
(c) Ownership of enterprises
(d) Use of raw materials
Q5. Which one among the following countries has the lowest GDP per capita?
(d) Sri Lanka
Q6. According to the 1991 Census, the highest percentage of the population in India is to be found in the age group of:
(a) 60 years and above
(b) 35 to 55 years
(c) 25 to 34 years
(d) 5 to 14 years
Q7. Which of the following benefits are likely to accrue to India from the World Trade Organization?
- India’s share in world trade is to go up from the present 600 million US dollars to 5 billion US dollars by 2000 AD.
- It will help boost exports of agricultural commodities from India.
- India’s share in world trade is likely to triple by the year 2000 A.D.
(a) 1, 2 and 3
(b) 1 and 3
(c) 1 and 3
(d) 2 and 3
Q8. Which of the following is among the non-plan expenditures of the Government of India?
- Defence expenditure
- All expenditures linked with the previous plan periods
- Interest payment
(a) 1 and 2
(b) 1 and 3
(c) 2 and 4
(d) 1, 2, 3 and 4
Q9. Scheme of
(i) Urban Micro-Enterprises, (ii) Urban Wage Employment, and (iii) Housing and Shelter Up-gradation are parts of:
(a) Integrated Rural Development Program
(b) Nehru Rojgar Yojana
(c) Jawahar Rojgar Yojana
(d) Prime Minister’s Rojgar Yojana
Q10. Which of the following constitutes the World Bank?
- International Bank for Reconstruction and Development
- International Finance Corporation
- International Development Association
- International Monetary Fund
(a) 1, 2 and 3
(b) 1 and 2
(c) 3 and 4
(d) 1, 2, 3 and 4
Q11. The problem of Economics arises from-
(b) Scarcity of goods
(c) More wants and fewer goods
(d) All of the above
Q12. ‘Hire and Fire’ is the policy of-
(c) Mixed economy
(d) Traditional economy
Q13. Which of the following does not determine the supply of labour?
(a) Size and age structure of the population
(b) Nature of work
(c) Marginal productivity of labour
(d) Work-leisure ratio
Q14. If the price of an article decreases from Rs. 100 to Rs. 80, when quantity demanded increases from Q1 units to 4600 units, and if point elasticity of demand is -0.75. Q1 =?
(a) 5000 units
(b) 4000 units
(c) 3000 units
(d) 2000 units
Q15. A fall in demand or rise in the supply of a commodity–
(a)Increases the price of that commodity
(b)Decreases the price of that commodity
(c)Neutralizes the changes in the price
(d)Determines the price elasticity
Q16. The difference between the price the consumer is prepared to pay for a commodity and the price which he actually pays is called
(a) Consumer’s Surplus
(b) Producer’s Surplus
(c) Landlord’s Surplus
(d) Worker’s Surplus
Q17. Economic rent refers to-
(a) Payment made for the use of land
(c) Producer’s surplus
(d) Consumer’s surplus
Q18. ‘Marginal efficiency of capitals–
(a) Expected rate of return of new investment
(b) Expected rate of return of existing investment
(c) Difference between the rate of profit and rate of interest
(d) Value of output per unit of capital invested
Q19. When Average Cost Production (ACP) falls, the marginal cost of production must be-
(c) Greater than the average cost
(d) Less than the average cost
Q20. Economic Survey in India is published officially, every year by the:
(a) Reserve Bank of India
(b) Planning Commission of India
(c) Ministry of Finance, Govt. of India
(d) Ministry of Industries, Govt. of India
Q21. The contribution of India’s small scale sector to the gross turnover in the manufacturing sector since 1992has been of the order of
Q22. Who recommends the MSP and issues prices?
(a)Ministry of agriculture
(c)Commission for Agricultural Costs and Prices
Q23. Development expenditure of the Central government does not include
(a) Defence expenditure
(b) Expenditure on economic services
(c) Expenditure on social and community services
(d) Grant to states
Q24. GDP is defined as the value of all
(a) Goods produced in an economy in a year
(b) Goods and services in an economy in a year
(c) Final goods produced in an economy in a year
(d) Final goods and services produced in an economy in a year.
Q25. Which of the following areas has been excluded, by the Ministry of Corporate Affairs, from the ambit of Corporate Social Responsibility (CSR) activities?
(a) Livelihood enhancement and rural development projects.
(b) Contributions made ‘directly or indirectly to any political party.
(c) Promoting preventive health care and sanitation.
(d) Making safe drinking water available would be considered CSR activities.
Economics MCQ Questions with Answer
Q26. Sustainable development is a case of inter-generational sensibility in respect of the use of
(a) Natural resources
(b) Material resources
(c) Industrial resources
(d) Social resources
Q27. Which of the following pairs are correctly matched?
- An increase in—monetary expansion
- The low import growth rate in India-Recession in Indian industry
- Euro-issues—Shares held by Indian companies in European countries
- Portfolio investment—Foreign institutional investors.
(a) 1, 2 and 4
(b) 3 and 4
(c) 1, 2 and 3
(d) 1, 2, 3 and 4
Q28. In which one of the following crops international trade is low in the context of total produce?
Q29. Quasi rent is a ____ phenomenon.
(b) Long term
(c) Short term
(d) No time
Q30. Why is rent earned by land even in the long run?
(a) Land has original and indestructible power
(b) Land is a manmade factor
(c) Its supply is inelastic in the short run
(d) Its supply is inelastic in the long run
Q31. The four factors of production are-
(a) Land, labour, capital, organization
(b) Land, electricity, water labour
(c) Labor, capital, land rainfall
(d) Labor, climate, land, rainfall
Q32. Consider the following actions by the Government:
1. Cutting the tax rates.
2. Increasing government spending.
3. Abolishing the subsidies. In the context of economic recession,
Which of the above actions can be considered a part of the ‘fiscal stimulus package?
(a) 1 and 2 only
(b) 2 only
(c) 1 and 3 only
(d) 1, 2 and 3
Q33. If the Sales tax on a commodity is raised, but the revenue earned through its sale decrease sharply, which one of the following statements about the nature of this commodity would be correct?
(a) Price elasticity of demand for it is unity
(b) It must be essential goods
(c) Price elasticity of demand for it is high
(d) Price elasticity of demand for it is low
Q34. Which one of the following is true regarding the Jawahar Rozgar Yojana (JRY)?
(a) It was launched during the Prime Ministership of Indira Gandhi
(b) It aims at creating one million jobs annually
(c) The target group of JRY is the urban poor living below the poverty line
(d) Under the scheme 30% of the employment generated is reserved for women
Q35. The largest source of financing the public sector outlay of the Eighth Five Year Plan comes from:
(a) Balance from current revenue
(b) Contribution of public enterprises
(c) Government borrowings
(d) Deficit financing
Q36. Assertion (A): India’s software exports increased at an average growth rate of 50% since 1995-96.
Reason (R): Indian software companies were cost-effective and maintained international quality.
(a) Both A and R are individually true and R is the correct explanation of A
(b) Both A and R are individually true but R is not the correct explanation of A
(c) A is true but R is false
(d) A is false but R is true
Q37. Depreciation is equal to
(a) GNP – NNP
(b) NNP – GNP
(c) GNP – Personal Income
(d) Personal Income – Personal Taxes
Q38. .Which of the following Tax is levied by Union and collected and appropriated by States?
(b)Passenger and Goods Tax
(d)Taxes on Newspapers
Q39. Investment is equal to-
(a) Gross total of all types of physical capital assets
(b) A Gross total of all capital assets minus wear and tear
(c) Stock of plants, machines
(d) None of the above
Q40. Extension or contraction of quantity demanded of a commodity is a result of a change in the-
(a) Unit price of the commodity
(b) Income of the consumer
(c) Tastes of the consumer
(d) Climate of the region
Q41. If the price of an article decreases from P1 to Rs. 25, the quantity demanded increases from 900units to 1200 units. If point elasticity of demand is 2 find P1?
(a) Rs. 20
(b) Rs. 30
(c) Rs. 35
(d) Rs. 15
Q42. Which one of the following is an example of joint supply?
(a) Petrol and Bus
(b) Ink and Fountain pen
(c) Sugar and Coffee
(d) Wool and Cotton
Q43. What is/are the most likely advantages of implementing ‘Goods and Services Tax (GST)’?
1. It will replace multiple taxes collected by multiple authorities and will thus create a single market in India.
2. It will drastically reduce the ‘Current Account Deficit’ of India and will enable it to increase its foreign exchange reserves.
3. It will enormously increase the growth and size of the economy of India and will enable it to overtake China in the near future.
Select the correct answer using the code given below:
(a) 1 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3
Q44. The First Five Year Plan of India was based on the—
(a) Harrod-Domar Model
(b) Mahalanobis Model
(c) DadabhaiNaoroji Model
(d) J. L. Nehru Model
Q45. As per the RBI guidelines, which one of the following is the minimum tenure of Masala Bonds that an Indian Company can issue offshore?
(a) Five years
(b) Four years
(c) Three years
(d) Two years
Q46. The New Exim Policy announced in 1992, is for a period of:
(a) 3 years
(b) 4 years
(c) 7 years
(d) 5 years
Q47. Which one of the following statements is correct?
(a) Alliance Air is a wholly-owned subsidiary of Indian Airlines
(b) The Airports Authority of India manages seven of the country’s international airports
(c) The Airports Authority of India is the regulatory organization for enforcing civil air regulations in India
(d) It is the function of the Directorate General of Civil Aviation to plan and construct runways and terminal buildings and to provide air safety services
Q48. . Match List-I with List-II and select the correct answer using the codes given below the lists:
|List – I||List-II|
|A. Boom||1. Business activity at a high level with increasing income, output, and employment at the macro level|
|B. Recession||2. Gradual fall of income, output, and employment with business activity in a low gear|
|C. Depression||3. Unprecedented level of underemployment, and unemployment, drastic fall in income output and employment.|
|D. Recovery||4. Steady rise in the general level of prices, income, output, and employment.|
(a) A-1; B-2; C-3; D-4
(b) A-1; B-2; C- 4; D-3
(c) A-2; B-1; C- 4; D-3
(d) A-2; B-1; C-3; D-4
Q49. NABARD was established in the
(a) Fourth Five Year Plan
(b) Fifth Five Year Plan
(c) Sixth Five Year Plan
(d) Eighth Five Year Plan
Q50. Indian farmers are unhappy over the introduction of “Terminator Seed Technology” because the seeds produced by this technology are expected to:
(a) Show poor germination
(b) From low-yielding plants despite the high quality
(c) Give rise to sexually sterile plants
(d) Give rise to plants incapable of forming viable seeds