Indian Economy problems
- 1. A large underground economy results in an
Options- A. Understated GDP price index
- B. Understated GDP
- C. Overstated GDP
- D. Overstated GDP price index Also asked in: AIEEE, Bank Exams, CAT, Analyst, Bank Clerk, Bank PO
Correct Answer: Overstated GDP
Explanation:
A large underground economy results in an Overstated GDP. The underground economy is also called as Black market. It refers to illegal economic activity. Transactions in the underground economy are illegal either because the good or service being traded is illegal or because an otherwise licit transaction does not comply with government reporting requirements.
- 2. Macroeconomics is the study of
Options- A. behavior of economy
- B. performance of economy
- C. changes in economy
- D. All of the above Also asked in: AIEEE, Bank Exams, CAT, Analyst, Bank Clerk, Bank PO
Correct Answer: All of the above
Explanation:
Macroeconomics is the study of overall aggregate changes, behavior and performance of the economy of the country i.e, unemployment, GDP, inflation, etc...
- 3. The most important determinant of consumer spending is
Options- A. consumer expectations
- B. the level of income
- C. the level of household borrowing
- D. the stock of wealth Also asked in: AIEEE, Bank Exams, CAT, Analyst, Bank Clerk, Bank PO
Correct Answer: the level of income
Explanation:
The most important determinant of consumer spending is the level of income.
- 4. The federal government debt is equal to the
Options- A. sum of past budget deficits minus the sum of past budget surpluses
- B. annual difference between federal government tax revenues and outlays
- C. obligations of benefits from federal taxes and expenditures
- D. sum of all annual federal government outlays Also asked in: AIEEE, Bank Exams, CAT, Analyst, Bank Clerk, Bank PO
Correct Answer: sum of past budget deficits minus the sum of past budget surpluses
Explanation:
The federal government debt is equal to the sum of past budget deficits minus the sum of past budget surpluses.
- 5. Mutual Funds are regulated in India by
Options- A. SEBI
- B. RBI
- C. RBI & SEBI both
- D. Stock Exchanges Also asked in: AIEEE, Bank Exams, CAT, Analyst, Bank Clerk, Bank PO
Correct Answer: SEBI
Explanation:
Mutual Funds are regulated in India by SEBI (Securities and Exchange Board of India). It was founded in 1992. In 1996, SEBI formulated the Mutual Fund Regulation.
- 6. Assessing opportunity cost involves
Options- A. choosing consequences over profits
- B. maximizing profit and loss
- C. making choices and dealing with consequences
- D. Both B & C Also asked in: AIEEE, Bank Exams, CAT, Analyst, Bank Clerk, Bank PO
Correct Answer: making choices and dealing with consequences
Explanation:
Assessing opportunity cost involves making choices and dealing with consequences.
- 7. The scarcity definition of economics is credited to
Options- A. Dennis Robertson
- B. Lionel Robbins
- C. Alfred Marshall
- D. Adam Smith Also asked in: AIEEE, Bank Exams, CAT, GATE, Analyst, Bank Clerk, Bank PO
Correct Answer: Lionel Robbins
Explanation:
The scarcity definition of economics is credited to Lionel Robbins.
- 8. What happens to demand when price increases?
Options- A. increases
- B. decreases
- C. remains same
- D. Can't be determined Also asked in: AIEEE, Bank Exams, CAT, Analyst, Bank Clerk, Bank PO
Correct Answer: decreases
Explanation:
The Law of Demand tells that, if the price of a product increases then the demand will go down i.e, decreases iff all other things equal.
- 9. A perfectly inelastic demand curve
Options- A. Vertical with some steep
- B. Perfectly horizontal
- C. Horizontal with some steep
- D. Perfectly vertical Also asked in: AIEEE, Bank Exams, CAT, Analyst, Bank Clerk, Bank PO
Correct Answer: Perfectly vertical
Explanation:
A perfectly inelastic demand curve is perfectly vertical either up or down in any way.
- 10. Deficit financing implies
Options- A. replacing new currency with worn out currency
- B. public revenue in excess of public expenditure
- C. printing new currency notes
- D. public expenditure in excess of public revenue Also asked in: AIEEE, Bank Exams, CAT, Analyst, Bank Clerk, Bank PO
Correct Answer: public expenditure in excess of public revenue
Explanation:
Deficit financing implies public expenditure in excess of public revenue.
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