Economics · Banking Financial Awareness

Macroeconomics and Policy

2,878 Questions

Macroeconomics and policy questions assess the understanding of broad economic indicators, government fiscal strategies, and banking regulations. Topics include inflation causes, currency exchange rates, monetary policy tools, and historical economic systems. These are highly tested in banking and civil services examinations.

Inflation FactorsMonetary PolicyExchange RatesFiscal PolicyEconomic IndicatorsBretton Woods System

Macroeconomics and Policy Questions

Multiple choice social science food security in india need for nregs rural development and employment guarantee scheme food security and nutrition

Identify the economic as well as social affects of hoarding.

  1. Creation of panic in the minds of the people.

  2. Exploitation of consumers.

  3. Rising inflation.

  4. All of the above.
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Hoarding in economics refers to maintaining unaccounted stocks of many commodities to save guard oneself from rise in general price level i.e. inflation or to take advantage of future rise in prices. This creates artificial scarcity of commodities in the market which further increase the prices of the commodities, leading to inflation. This is a clear case of exploitation of the consumers and such a situation may create panic in the society.

Multiple choice social science food security in india need for nregs rural development and employment guarantee scheme food security and nutrition

Environmental deterioration has caused heavy economic losses, all of which can be expressed in monetary terms.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

In the process of production and consumption, natural resources are exploited as a result of various activities that causes many types of pollution which includes air, water and land pollution. These losses cannot be measured in terms of money as it includes loss of life and society, and impairs physical and mental growth of the people.

Multiple choice economics unemployment in india types of unemployment unemployment and measures to remove employment and unemployment in india - problems and policies

During the recessionary phase of Trade Cycle____.

  1. aggregate demand falls

  2. there is disinvestment, decline in production

  3. there is unemployment

  4. all of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

During a recession, aggregate demand falls, which leads to reduced production, disinvestment, and consequently, higher levels of unemployment.

Multiple choice economics ancient indian economic concepts goods, wealth and welfare major definitions of economics wealth, capital and money

If Willingness to Save is higher, the level of ________ will be higher.

  1. Voluntary Savings

  2. Compulsory Savings

  3. Forced Savings

  4. None of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Voluntary savings are funds that individuals or organizations may willingly deposit or Withdraw. For your clients, the condition of an intended savings product means that: They can save money in a safe place to meet emergency and consumption. Required savings are those that individuals and institution are forced to make as per government rules. 

Thus, the correct option is A.

Multiple choice organisation of commerce and management the nature of the indian economy part 2 industrial revolution in india subsidies, industrial policy and trade policy cottage and small scale industries

A recession is a __________.

  1. period of declining prices

  2. period of very rapidly declining prices

  3. period of declining unemployment

  4. period during which aggregate output declines
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

A recession is a period during which aggregate output declines. Recession can be defined as a part of the business cycle contraction. In this phase, overall economy experiences downfall. Other indicators such as GDP, investment spending, capital utilization, etc also tend to decline.

Multiple choice history economic system and economic policies american dominance, neo-imperialism and new economic policy insights on lpg changing economic policies

What is a feature of 'Reaganomics'?

  1. Increase in federal spending

  2. Expanding money supply

  3. Reduction in tax rates

  4. Cutting back on foreign trade
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Reaganomics is a popular term referring to the economic policies of Ronald Reagan, the 40th U.S. president (1981–1989). His policies called for widespread tax cuts, decreased social spending, increased military spending, and the deregulation of domestic markets. 

Hence, the correct option is C.

Multiple choice history economic system and economic policies american dominance, neo-imperialism and new economic policy insights on lpg changing economic policies

What were the primary reasons for the economic crisis in the 1980s?

  1. Spending on development programmes which didn't generate additional revenue

  2. Internal sources like taxation weren't generating enough revenue

  3. Income from public sector was not very high

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation
The origin of the financial crisis can be traced from the inefficient management of the Indian economy in the 1980s. Development policies required that even though the revenues were very low, the government had to overshoot its revenue to meet problems like  unemployment, poverty and population explosion. The continued spending on development programmes of the government did not generate additional revenue.
Moreover, the government was not able to generate sufficiently from internal sources such as taxation. The income from public sector undertakings was also not very high to meet the growing expenditure.
Multiple choice history economic system and economic policies american dominance, neo-imperialism and new economic policy insights on lpg changing economic policies

Stabilisation measures were intended to __________.

  1. correct balance of payments

  2. improving efficiency of the economy

  3. control inflation

  4. A and C
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

India agreed to the conditionalities of World Bank and IMF and announced the New Economic Policy (NEP). The NEP consisted of wide ranging economic reforms. This set of policies can broadly be classified into two groups: the  stabilisation measures and the structural reform measures. Stabilisation measures are short term measures, intended to correct some of the weaknesses that have developed in the balance of payments and to bring inflation under control. In simple words, this means that there was a need to maintain sufficient foreign exchange reserves and keep the rising prices under control.

Multiple choice business organisation and correspondence meaning and factors of business environment dimensions of business environment business environment and its dimensions business environment

Inflation is defined as __________.

  1. persistent rise in general price level

  2. fall in general price level

  3. fall in the value of money

  4. purchasing power of consumer
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Inflation is defined as a sustained or persistent increase in the general price level of goods and services in an economy over a period of time.

Multiple choice business organisation and correspondence meaning and factors of business environment dimensions of business environment business environment and its dimensions business environment

Which of the following is an economic factor -

  1. Exchange rates

  2. Licensing regulations

  3. Labour courts

  4. Employment needs
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Licensing regulations is an economic factor as it includes with providing sufficient business license to the corporate units in order to survive in competition that prevails in the market. After, liberalization, many of such license where removed so that many business can flourish in the country. 

Multiple choice business economics and quantitative methods measurement of national income methods of national income methods of measuring national income national income analysis

If Willingness to Save is less, the level of ________ will be higher.

  1. Government regulated Savings

  2. Compulsory Savings

  3. Forced Savings

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

When voluntary savings are insufficient, governments may resort to forced savings through measures like taxation, inflation, or mandatory provident funds to increase the total savings in the economy.

Multiple choice civics foreign trade in india the government and economic development indian economy on the eve of independence impact of technology on livelihoods

Economic reform is required to overcome the problem of:
(i)  Excess consumption and expenditure over revenue
(ii) Over protection to industry and heavy losses in public sector
(iii) Mismanagement of firm, economy and poor technological development
(iv) Mismanagement of foreign exchange reserve and shortage of foreign exchange

  1. (i) and (ii)

  2. (i) and (iii)

  3. (i) (ii) and (iii)

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Economic reform is required to overcome the problem of:
(i)  Excess consumption and expenditure over revenue
(ii) Over protection to industry and heavy losses in public sector
(iii) Mismanagement of firm, economy and poor technological development

(iv) Mismanagement of foreign exchange reserve and shortage of foreign exchange
Economic reforms aims to create a more freer economy and uphold the process of liberalization, privatization and globalization. It helps to achieve a higher economic growth and development.