Economics MCQ Questions with Answer

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Economics MCQ Questions with Answer

Quiz-1Quiz-2

Q81. Who generally presents the Finance Budget in the Indian Parliament?

(a) RBI Governor

(b) Budget Minister

(c) Finance Minister

(d) Finance Secretary

Answer: (c)

Explanation: The finance budget is a government plan of revenue and expenditure for a year and it is generally presented by the finance minister of the country.

Q82. Special Economic Zone (SEZ) concept was first introduced in–

(a) China

(b) Japan

(c) India

(d) Pakistan

Answer: (a)

Explanation: China first introduced the concept of a Special Economic Zone (SEZ) in 1980.

Q83. What is meant by ‘Public Good’?​

(a) A commodity produced by the Government

​(b)​ A commodity whose benefits are indivisibly spread among the entire community ​

(c)​ A Government scheme that benefits the poor households

​(d)​ Any commodity that is very popular among the general public

Answer: (b)​

Explanation: Public good means a commodity or service which is given without profit to everyone in society by the government or any organization.

Q84. Match List-I with List-II and select the correct answer using the codes given below the lists:

List-I (Term)List-II (Explanation)
A. Fiscal deficit1. Excess of total expenditure over total receipts
B. Budget deficit2. Excess of revenue expenditure over revenue receipts
C. Revenue deficit3. Excess of total expenditure over total receipts fewer borrowings
D. Primary deficit4. Excess of total expenditure over total receipts fewer borrowings & interests payments.

Codes: A B C D

(a) ​       3 1 2 4

(b) ​       4 3 2 1

(c) ​       1 3 2 4

(d) ​       3 1 4 2

Answer: ​(a) ​

Explanation: Fiscal deficit – Excess of total expenditure over total receipts fewer borrowings. ​​

Budget deficit – Excess of total expenditure over total receipts.

Revenue deficit-Excess of total expenditure over revenue receipts. ​​

Primary deficit-Excess of total expenditure over total receipts fewer borrowings & Interest payments.

Q85. Consider the following statements—

​I. ​Sick Company is defined as one whose accumulated losses in any financial year are equal to or more than 50% of its average net worth during the previous four financial years.

II. The Government set-up Board of Industrial and Financial Reconstruction in 1987.

Which of the statement given above is/are correct? ​

Select the answer from the codes given below— ​

Codes:

​(a)  ​Only I

​(b)  ​Only II

​(c)  ​Both I and II ​

(d)  ​Neither I nor II

Answer: (c)

Explanation: ​An industrial unit is also regarded as a potentially sick or weak unit if, at the end of any financial year, it has accumulated losses equal to or exceeding 50 percent of its average net worth in the immediately preceding four financial years and has failed to repay debts to its creditor (s) in three consecutive quarters on demand made in writing for such repayment. ​​The Board for Industrial and Financial Reconstruction was established under The Sick Industrial Companies (Special Provisions) Act, 1985. The board was set up in January 1987 and became functional as of 15 May 1987.

Q86. Where is the Headquarters of WTO located?

​(a) ​Rome ​

(b) ​Geneva ​

(c) ​Washington ​

(d) ​New York

Answer: (b) ​

Explanation: The World Trade Organization (WTO) is an organization that supervises and liberalizes international trade. It officially commenced on 1 January 1995 under the Marrakech Agreement, replacing the General Agreement on Tariffs and Trade (GATT) The headquarters of the World Trade Organization (WTO) is located in Geneva.

Q87. The main reason for the low growth rate in India, inspire of high rate of savings and capital formation is:

(a) High birth rate

(b) Low level of foreign and

(c) Low capital-output ratio

(d) High capital-output ratio

Answer: (d)

Explanation: The capital-output ratio is used to produce output over a period of time. This ratio has a tendency to be high when capital is cheap as compared to other inputs. For instance, a country with abundant natural resources can use its resources in lieu of capital to boost its output, hence the resulting capital-output ratio is low.

Q88. Which one of the following is the objective of the National Renewal Fund?

(a) To safeguard the interests of workers who may be affected by technological up-gradation of industry or closure of sick units

(b) To develop the core sector of the economy

(c) For the development of infrastructures such as energy, transport communications, and irrigation

(d) For human resource development such as full literacy, employment-population control, housing, and drinking water

Answer: (a)

Explanation: The concept of the National Renewal Fund was announced by the Government as a part of the New Industrial Policy, 1991. The Government established the National Renewal Fund (NRF) by a Government of India resolution on 3rd February 1992.

Q89. Match List-I with List-II and select the correct answer using the codes given the lists:

List-I (Industries)List-II  (Industrial Centers)
A. Pearl fishing1. Pune
B. Automobiles2. Tuticorin
C. Shipbuilding3. Pinjore
D. Engineering goods4. Marmagao

Codes:

(a) A-2; B-1; C-4; D-3

(b) A-2; B-1; C-3; D-4

(c) A-1; B-2; C-4; D-3

(d) A-1; B-2; C-3; D-4

Answer: (a)

Explanation: Industries Industrial centers A. Pearl fishing Tuticorin

  1. Automobile industry – Pune
  2. Shipbuilding – Marmagao
  3. Engineering goods – Pinjore

Q90. The “Law of Market” propounded by J.B. Say was not acceptable to –

(a) Adam Smith

(b) Marshall

(c) David Recordo

(d) Malthus

Answer: (d)

Explanation: Law of market or Say’s law is propounded by J.B. Say. It states that production is the main cause of demand.

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