Tag: income-output determination

Quizzes (4) Questions (97)

Questions Related to income-output determination

Multiple choice economics income-output determination public debt public debt main feature of tax

___________ refers to the amount of sales proceeds which an entrepreneur actually expects from the sale of output produced at a given level of employment during the year.

  1. Aggregate demand

  2. Market demand

  3. Aggregate supply

  4. Aggregate income
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Aggregate Demand refers to the desired level of expenditure in the economy during an accounting year. So it can also be expressed as the sale proceeds because the expenditure from consumer's point of view is sales proceeds or earnings from producer's point of view. Therefore, Aggregate demand is the amount of sales proceeds which an entrepreneur actually expects from the sale of output produced during the year assuming it to be the full employment level of output. 

Multiple choice economics income-output determination public debt public debt main feature of tax

____________ is the expenditure incurred for those goods and services which satisfy the wants of private individuals and institutions directly.

  1. Consumption expenditure

  2. Investment expenditure

  3. Induced expenditure

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

Consumption expenditure refers to the expenditure which is incurred on the basic act of consuming goods and services to satisfy the wants of the individuals. It is usually incurred directly by private individuals and institutions. 

Multiple choice economics income-output determination public debt public debt main feature of tax

Who propounded the 'market law'?

  1. Adam Smith

  2. J B Say

  3. T R Malthus

  4. David Recardo
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Law was propounded by J.B say
This law means that ‘supply always creates its own demand.’ In other words, according to J.B. Say, there cannot be general over­production or general unemployment on account of the excess of supply over demand because whatever is supplied or produced is automatically exchanged for money.

Multiple choice economics income-output determination public debt public debt main feature of tax

What is the break even point?

  1. Marginal revenue equals marginal cost

  2. Average revenue equals average cost

  3. Total revenue equals total cost

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

Break-even point is that point where the producer is able to recover the total cost of production through sale of output and incurs no profit or loss. The total revenue here must equal the total cost for the firm to break-even at a given level of production of output.

Multiple choice economics income-output determination public debt public debt main feature of tax

Graphically, when demand curve moves upward, there is __________.

  1. more demand 

  2. more supply

  3. equilibrium

  4. none of these
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

The demand curve is a graphical representation of the relationship between the price of a good or service and the quantity demanded for a given period of time.

When the demand curve moves upward this shows that the price of good increases and the demand for goods falls this will show the upward movement in the demand curve

Multiple choice economics income-output determination public debt public debt main feature of tax

Geometric method is also known as Point Method.

  1. True

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

Geometric method was suggested by Prof. Marshall and is used to measure the elasticity at a point on the demand curve. When there are infinitely small changes in price and demand, then the 'Geometric Method' is used. This method is also known as 'Graphic Method' or 'Point Method' or 'Arc Method'.

Multiple choice economics income-output determination public debt public debt main feature of tax

Due to government expenditure demand increases.

  1. True

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

True. Government expenditure increases demand. Its one of the components to determine demand. Aggregate demand takes into account all the expenditure incurred in the country during the year. Government spending can be in the form of welfare, pension etc which increases the purchasing power of the people thereby increasing demand. 

Multiple choice economics income-output determination public debt public debt main feature of tax

In economics, equilibrium is a situation in which __________.

  1. there is no inherent tendency to change

  2. quantity demanded equals quantity supplied

  3. the market clears and becomes stable

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

Equilibrium state is a state at which the quantity supplied is equal to the quantity demanded. Hence, neither buyers nor sellers want to change their behaviour. They are exact same. Hence, in economics, equilibrium is a situation in which there is no inherent tendency to change. Also, the market clears and becomes stable.

Multiple choice economics income-output determination public debt public debt main feature of tax

In economics, equilibrium is a situation in which _________.

  1. the market becomes unstable

  2. there is no inherent tendency to change

  3. quantity demanded is more than quantity supplied

  4. when firm start to make profit
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Equilibrium state is a state at which the quantity supplied is equal to the quantity demanded. Hence, neither buyers nor sellers want to change their behaviour. They are exact same. Hence, in economics, equilibrium is a situation in which there is no inherent tendency to change.

Multiple choice economics income-output determination public debt public debt main feature of tax

The Foreign Exchange Reserves of India consist of __________.

  1. Foreign Currency Assets held by RBI

  2. Gold Holdings of RBI

  3. Special Drawing Rights (SDRs)

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

Foreign exchange reserves of India Consists of Foreign currency assets held by RBI, gold holding of RBI, Special drawings Rights. Foreign exchange reserves of India are holdings of cash, bank deposits, bonds and other financial assets.