Tag: objectives of economic planning in india

Questions Related to objectives of economic planning in india

Opportunity costs are a result of __________.

economics economic reconstruction economics of planning objectives of economic planning in india major economic problems

  1. scarcity

  2. overproduction

  3. technology obsolescence

  4. abundance of resources

Show answer
Correct Option: A
Explanation:

The cost of the next best alternative foregone is termed as opportunity cost. Opportunity cost, in terms of production of a commodity refers to the resources which the producer has to sacrifice in terms of the next best alternative which could have been produced using them, in order to produce every unit of the given commodity.
Therefore, opportunity cost is a result of scarcity of resources in the economy.

Multiple choice question:

Which of the following is not concerned with the problem of choice?

economics economic reconstruction economics of planning objectives of economic planning in india major economic problems

  1. Excessive income

  2. Alternative use of resources

  3. Unlimited wants

  4. Limited (scarce) resources

Show answer
Correct Option: A
Explanation:

When there is excessive income in the economy then a large part of it is spent on consumption of goods and services and its a human tendency that human needs are unlimited, so when the selection is done between various commodities in the market it is very difficult for all the consumers to decide the product being rational so they face problems inchoosing the product.  

Which of the following is the cause of economic insecurity?

economics economic reconstruction economics of planning objectives of economic planning in india major economic problems

  1. Poverty.

  2. Unemployment.

  3. Fall in real wages.

  4. All of the above.

Show answer
Correct Option: D
Explanation:

Economic insecurity describes the risk of financial loss faced by workers and households as they encounter the changeable events of social life. Our re-considerations suggest a four-part structure for studying the distribution and trend in these economic risks. 

First is that a centre on households captures the micro-level risk pooling that can smooth income flows and stabilize economic well-being. 

Second, insecurity is related to income instability and the risk of downward mobility into poverty. 

Third, difficult events such as unemployment, family closure, or poor health commonly trigger income losses. 

Fourth, the belongings of difficult events are explanatory by insurance relationships provided by government programs, employer benefits, and the familiar maintain of family. 

The correct option is D.

The most serious economic problem in India is ___________.

economics economic reconstruction economics of planning objectives of economic planning in india major economic problems

  1. unemployment

  2. rising population

  3. poverty

  4. all of the above

Show answer
Correct Option: D
Explanation:

The most serious economic problems in India are:

1)Unemployment- High unemployment indicates the economy is operating below full capacity and is inefficient; this will lead to lower output and incomes. The unemployed are also unable to purchase as many goods, so will contribute to lower spending and lower output. A rise in unemployment can cause a negative multiplier effect.

2) This economic problem of rising population leads to poverty, lack of free medical assistance, lack of social security and bad living conditions. Excessive population leads to working institutions dysfunctionality and makes all plans to improve a country’s infrastructure, medical assistance facilities and social welfare initiatives ineffective. This includes the Indian Government which has struggled to enact reforms over the past 69 years since independence. 

3) The direct effects of poverty are hunger, malnutrition and susceptibility to diseases. These have been identified as huge problems across the world. ... The growth of population in India is way beyond the growth in economy and the gross result is such that the poverty figures have remained more or less constant.

Multiple Choice Question:

The opportunity cost of $100kg$ of rice produced on a land which can also produce $80$ tonnes of wheat is _____________.

economics economic reconstruction economics of planning objectives of economic planning in india major economic problems

  1. $100kg$ of wheat

  2. $80$ tonnes of wheat

  3. $8,000$ tonnes of wheat

  4. none of these

Show answer
Correct Option: B
Explanation:

Opportunity cost of production of a commodity refers to the resources which have to be sacrifice in terms of the next best alternative which could have been produced using the same resources.
Therefore, the next best alternative which could be produced on the piece of land mentioned here is 80 tonnes of wheat, which is sacrificed for the production of 100 kg of rice.

The problem of 'what to produce' relates to ______________.
economics economic reconstruction economics of planning objectives of economic planning in india major economic problems

  1. the choice of technique

  2. distribution of income

  3. market value of the goods and services

  4. the choice of goods and services

Show answer
Correct Option: D
Explanation:
The central problem of "what to produce?" which is faced by the economy where the economy decides the goods that need to be produced in the economy whether consumer or capital goods to satisfy human wants to keep in mind the available resources and state of technology in the economy.
Hence, D is the correct option.

Which of the following is related to the problem 'how to produce'?
economics economic reconstruction economics of planning objectives of economic planning in india major economic problems

  1. Factorial distribution of income.

  2. The choice of technique.

  3. The choice of product.

  4. None of the above.

Show answer
Correct Option: B
Explanation:

The question for "How to produce?" is faced by the economy they should consider both labour intensive techniques as well as capital intensive techniques depending upon the availability of resources in the economy.

Multiple choice question:

In which of the following situations, does scarcity arise?

economics economic reconstruction economics of planning objectives of economic planning in india major economic problems

  1. Supply of resources $>$ Demand for resources

  2. Supply of resources $<$ Demand for resources

  3. Supply of resources $=$ Demand for resources

  4. None of these

Show answer
Correct Option: B
Explanation:

Scarcity of resources refers to the situation where resources are limited in quantity and have alternative uses in production of various commodities. So the problem of these scarce resources is reflected in the aggregate supply of the economy which is also limited owing to limited source of inputs and unlimited demands as human wants are unlimited. 

Multiple Choice Question:

Output of Good-X decreases by $500$ units and output of Good - Y increases by $500$ units, when some resources are shifted from the production of X to the production of Y. The marginal opportunity cost is __________.

economics economic reconstruction economics of planning objectives of economic planning in india major economic problems

  1. $0.2$

  2. $0.75$

  3. $0.8$

  4. $1.0$

Show answer
Correct Option: D
Explanation:

Output of Good-X decreases by 500 units and output of Good-Y increases by 500 units, when some resources are shifted from the production of X to the production of Y. The marginal opportunity cost is 1.0. The slope of production possibility curve is marginal opportunity cost which refers to the additional sacrifice that a firm makes when they shift resources and technology from production of one commodity to the other. The formula to calculate marginal opportunity cost is sacrifice/gains. Therefore, the marginal opportunity cost is 500/500= 1.

In a free market economy, decision relating to 'for whom to produce' enhances the gap between the rich and the poor.
economics economic reconstruction economics of planning objectives of economic planning in india major economic problems

  1. True

  2. False

Show answer
Correct Option: A
Explanation:

In a free economy, the producers will produce goods for those who can afford to pay high price. Poorer sections of the society are often, thus, ignored. As a result, the gap between the rich and the poor enhances.