Q71. Buyers and Sellers will have perfect Knowledge of market conditions under-
(a) Duopoly
(b) Perfect Competition
(c) Monopolistic competition
(d) Oligopoly
Answer: (b)
Explanation: Complete market information is one of the main features of perfect competition.
Q72. The best Example of the capital intensive industry in India is-
(a) Textile industry
(b) Steel industry
(c) Tourism industry
(d) Spare goods industry
Answer: (b)
Explanation: Capital-intensive industry is those industries that need a large amount of investment in capital i.e. large investment in machinery and infrastructure. In the above industries, the steel industry is the best example of a capital-intensive industry in India.
Q73. Arthashastra by “Kautilya” is related with-
(a) Military Phase
(b) Political Reign
(c) Social Phase
(d) Economic Postulates
Answer: (b)
Explanation: Arthashastra is written by Kautilya or Vishnugupta or Chanakya. Arthashastra is a compilation of various treaties, strategies, and policies basically an art of political reign.
Q74. The concept of a mixed economy means-
(a) To have balanced development in the agricultural and industrial sector
(b) Simultaneous development of the rural and urban sector
(c) To have an equal distribution of wealth among the rural and the urban poor
(d) Simultaneous existence of the private and public sector
Answer: (d)
Explanation: Explanation: Mixed Economy refers to a system of economy which have the presence of government i.e. public sector as well as the private sector. This economy has the public sector to have a monopoly on strategic or essential goods that can’t be handled by the private sector and have a private sector for general goods production and distribution.
Q75. The main feature of a capitalist economy is-
(a) Administered prices
(b) Public ownership
(c) Economic planning
(d) Private ownership
Answer: (d)
Explanation: Capitalist economy is an economic system in which the production and distribution of goods and services are done by private organizations. Thus, private ownership is allowed.
Q76. Capacity utilization-
(a) Is usually near 100 percent
(b) Represents the percent of the labor force that is employed
(c) is a measure of the proportional of the existing capital stock used for current production
(d) Rises as the economy moves into a recession since firms must replace unemployed workers with some other resources to maintain production
Answer: (c)
Explanation: Capacity utilization refers to the level to which the capacity is used in terms of the generation of goods and services. It is a measurement that states the percentage of capacity used in production.
Q77. Goods whose demand is proportional to price are called-
(a) Inferior goods
(b) Veblen goods
(c) Normal goods
(d) Exclusive goods
Answer: (b)
Explanation: Veblen goods also can be said as positional goods or kinds of luxury goods. Their demand increases as the income of consumers increases. One of the features of Veblen goods is that their demand is created as more income is earned like luxury care, (jewelry).
Q78. The worldwide Great Depression took place in-
(a) 1936
(b) 1929
(c) 1928
(d) 1930
Answer: (b)
Explanation: Great depression was a depression in economic activities all around the world. It originated in the United States with a severe fall in the price of the stock (also known as Black Tuesday) later it spread all over the world. It occurred in 1929.
Q79. Cheap Money means-
(a) Low Rate of Interest
(b) Low Level of Savings
(c) Low-Level Income
(d) Excess of Black Money
Answer: (a)
Explanation: Cheap money means easy availability of money that means an increase in the supply of money that can be done through a low rate of interest.
Q80. If Money supply growth is faster than real GDP growth, it results in _____.
(a) Inflation
(b) Deflation
(c) Budget surplus
(d) Budget deficit
Answer: (a)
Explanation: Inflation is a condition where there is an increase in the general price level of articles. So, if money supply growth is faster it will create more money chasing too few goods. Ultimately leading to inflation.
