Tag: macroeconomic theories

Quizzes (0) Questions (55)

Questions Related to macroeconomic theories

Multiple choice economics basic concepts of national income macroeconomic theories some basic concepts of macroeconomics introduction to macroeconomics

Depreciation means ___________________.

  1. Destruction of a plant in a fire accident

  2. Loss of fixed assets overtime due to wear and tear

  3. Loss of fixed assets in an earthquake

  4. Closure of the plant due to lockout
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Depreciation means loss of fixed assets overtime due to wear and tear. Depreciation is also called consumption of fixed capital. Loss of fixed assets happen on account of normal wear and tear, normal rate of accidental damages and expected obsolescence.

Multiple choice economics basic concepts of national income macroeconomic theories some basic concepts of macroeconomics introduction to macroeconomics

Final goods refer to those goods which are used either for ______ or for ________.

  1. Consumption, investment

  2. Consumption, resale

  3. Resale, investment

  4. Resale, further production
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Final goods refer to those goods which are used either for consumption or for investment. Final goods have crossed the boundary of production and are ready for use by their final users. These goods are included in the estimation of national product or national income. Example: Bread and butter used by the consumers.

Multiple choice economics basic concepts of national income macroeconomic theories some basic concepts of macroeconomics introduction to macroeconomics

Net factor income from abroad is ________________.

  1. Exports minus Imports

  2. Visible Exports minus Visible Imports

  3. Factor income received from abroad minus factor income paid abroad

  4. Factor incomes received from abroad
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation
Net factor income from abroad is factor income received from abroad minus factor incomes paid abroad.
Equation:
Net factor income from abroad= Factor income earned by our residents from the rest of the world - Factor income earned by non- residents in our domestic territory.
Multiple choice economics basic concepts of national income macroeconomic theories some basic concepts of macroeconomics introduction to macroeconomics

Which of the following is an example of an intermediate goods? 

  1. Car sold by a dealer of second hand cars

  2. Steel and cement used to construct a flyover

  3. Fertilizers purchased by a farmer

  4. All the these
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation
All of the following are examples of an intermediate good:
a) Car sold by a dealer of second hand cars: It is an intermediate good since cars are purchased by a dealer as goods for resale.
b) Steel and cement used to construct a flyover: It is an intermediate good since steel and cement are used as a raw material.
c) Fertilizers purchased by a farmer: It is an intermediate good since fertilizers is used as a raw material in agriculture.
Multiple choice economics basic concepts of national income macroeconomic theories some basic concepts of macroeconomics introduction to macroeconomics

Sugar purchased by a Sweet shop is an ______ good, while it is a _______ good when it is purchased by a consumer. 

  1. capital, final

  2. final, intermediate

  3. intermediate, final

  4. final, producer
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Sugar purchased by a Sweet shop is an intermediate good, while it is a final good when it is purchased by a consumer as sugar purchased by a sweet shop is used as a raw material and goods used for raw material are classified as intermediate goods as value is yet to be added, while, sugar purchased by a consumer is a final good as it is directly consumed and no value is yet to be added.

Multiple choice economics basic concepts of national income macroeconomic theories some basic concepts of macroeconomics introduction to macroeconomics

Depreciation of fixed capital assets refers to _______________.

  1. Normal wear and tear

  2. Foreseen obsolescence

  3. Normal wear & tear & foreseen obsolescence

  4. Unforeseen obsolescence
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Depreciation of fixed capital assets refers to normal wear and tear and foreseen obsolescence. Depreciation is also called consumption of fixed capital. Loss of fixed assets happen on account of normal wear and tear, normal rate of accidental damages and expected obsolescence.

Multiple choice economics basic concepts of national income macroeconomic theories some basic concepts of macroeconomics introduction to macroeconomics

Goods purchased for the following purpose are final goods ________________.

  1. For satisfaction of wants

  2. For investment in firm

  3. Both (a) and (b)

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


Goods purchased for the following purpose are final goods:
a) For satisfaction of wants
b) For investment in firm
Final goods are those goods which crossed the boundary of production and are ready to use by their final users, Final goods must lead to either final consumption expenditure or investment expenditure in the economy.

Multiple choice economics basic concepts of national income macroeconomic theories some basic concepts of macroeconomics introduction to macroeconomics

Unforeseen obsolescence of fixed capital assets during production is ________________.

  1. Consumption of Fixed Capital

  2. Capital Loss

  3. Income Loss

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

Unforeseen obsolescence of fixed capital assets during production is capital loss. Unforeseen obsolescence which may happen due to natural calamity is not taken into account while calculating depreciation and hence, it causes capital loss.

Multiple choice economics basic concepts of national income macroeconomic theories some basic concepts of macroeconomics introduction to macroeconomics

Are the following statements true or false? Give reasons.
Increase in stock of goods held by a consumer will contribute to capital formation. 

  1. True

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

Capital formation refers to the net addition to the stock of capital goods (like machinery, factories, or infrastructure). Goods held by a consumer for personal use are consumption goods, not capital goods, so they do not contribute to capital formation.