Economics · General Awareness

Economic Principles

1,087 Questions

Economic principles form the foundation of how societies allocate resources and produce goods. This topic covers factors of production, types of capital, and demand classifications. It is a vital component of the economics syllabus in many civil services and banking exams.

Factors of productionCapital typesDemand classificationsEconomic activities

Economic Principles Questions

Multiple choice

Low average productivity in the European Union can be attributed to

  1. low GDP per hour

  2. low GDP per head

  3. low productivity in Britain, Spain, Greece and Portugal

  4. low output per hour

  5. none of these
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Low productivity in Britain, Spain, Greece and Portugal The last sentence in the second paragraph states that the average productivity in the European Union is less than that in America because of the combined effect of low productivity in Britain, Spain, Greece and Portugal

Multiple choice

Directions: Choose the correct option for the given question.

Material consumed = _____ + Purchase of raw material - Closing stock of raw material.

  1. Opening stock of raw material

  2. Opening stock of finished goods

  3. Opening stock of work-in-progress

  4. Either (1) or (2)

  5. All of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The formula for material consumed is Opening Stock + Purchases - Closing Stock. This represents the raw material used during the period.

Multiple choice

Directions: Choose the correct option for the given question.

_____ is a major constraint on all the operational activities of the organisation.

  1. Limiting factor

  2. Production

  3. Marketing

  4. Sales value

  5. None of these
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

A limiting factor (or key factor) is any constraint that restricts the volume of activity of an organization, such as labor, materials, or machine capacity. It is the factor that prevents the company from achieving higher sales or production.

Multiple choice

Directions: Choose the correct option for the given question.

The product generally ______ over the relative quantities of by-products and the main products.

  1. has control

  2. has no control

  3. is of high value

  4. both (1) and (3)

  5. none of these
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

In most production processes, the manufacturer has little control over the relative quantities of by-products generated, as they are an inherent result of producing the main product.