Tag: wealth, capital and money

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Questions Related to wealth, capital and money

Multiple choice economics concept of consumption function, saving function and investment function capital economy of a village wealth, capital and money

Consider the following groups of items:
(i)Factory buildings
(ii)Plant and Machinery
(iii) Stocks of raw materials
(iv)Wage bills
Which of these are known as working capital?

  1. i and ii

  2. iii and iv

  3. i, ii and iii

  4. ii, iii and iv
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Working capital refers to those goods which are used to run the day-to-day activities in an organization. Thus stocks of raw materials and wage bills comprise the working capital.

Multiple choice economics concept of consumption function, saving function and investment function capital economy of a village wealth, capital and money

In economics, the term 'capital' means-
I. Money introduced in business.
II. Things like tools, machines & equipment.
Select the correct answer from the options given below-

  1. I only

  2. II only

  3. Both I and II

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

Capital is the overall investment that is done in the business which is used either in the form of money or converted into assets, like tools, machines and equipment which are used productively to yield output.

Multiple choice economics concept of consumption function, saving function and investment function capital economy of a village wealth, capital and money

What does venture capital mean?

  1. A short-term capital provided to industries

  2. A long-term start-up capital provided to new entrepreneurs

  3. Funds provided to industries at times of incurring losses

  4. Funds provided for replacement and renovation of industries
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Entrepreneurs with ideas but lacking capital seek funds through the 'venture capital funds', In the RBI's classification such funds fall under Alternative Investment Funds (AIFs).

Multiple choice economics concept of consumption function, saving function and investment function capital economy of a village wealth, capital and money

Which of the following statements is correct?

  1. Robbins defined economics in the form of welfare economics.

  2. The law of demand is always true.

  3. All capital is wealth, but all wealth is not capital.

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

Capital is a part of wealth which can be utilized for supplementary production of wealth. Hence, all money/wealth is not said to be capital, but only that which is engrossed in generation of more income.
Law of demand has certain exceptions. While, Robbins defined economics under the scarcity approach.

Multiple choice economics concept of consumption function, saving function and investment function capital economy of a village wealth, capital and money

All Wealth is Capital, but all Capital is not Wealth. This statement is _____________.

  1. True

  2. False

  3. Partially True

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

Wealth includes all goods that have value and are scarce, while capital is a subset of wealth used for further production. Therefore, all capital is wealth, but not all wealth is capital. The statement provided is the reverse of this definition, making it false.

Multiple choice economics concept of consumption function, saving function and investment function capital economy of a village wealth, capital and money

If a Resource is lying idle, it will constitute ______________.

  1. Wealth

  2. Capital

  3. Both (a) and (b)

  4. Neither (a) nor (b)
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Wealth is defined as anything that has value and can be owned. Even if a resource is lying idle, it still possesses value and constitutes wealth, though it is not currently functioning as capital.

Multiple choice economics concept of consumption function, saving function and investment function capital economy of a village wealth, capital and money

All Capital is Wealth, but all Wealth is not Capital. This statement is ____________.

  1. True

  2. False

  3. Partially True

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

Capital is a specific type of wealth used to produce more goods or services. Since all capital must be wealth, but not all wealth (like consumer goods) is used for production, the statement is true.

Multiple choice economics concept of consumption function, saving function and investment function capital economy of a village wealth, capital and money

As a Factor of Production, "Capital" can be used for _______________.

  1. Further production of wealth

  2. Yielding further income

  3. Both (a) and (b)

  4. Neither (a) nor (b)
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Capital is defined as a factor of production that is used to create more wealth or generate income. Both options (a) and (b) describe the functional purpose of capital.

Multiple choice economics concept of consumption function, saving function and investment function capital economy of a village wealth, capital and money

The process of increase in the stock of real capital in a country is called ______________.

  1. Stock Increase

  2. Capital Formation

  3. Increase in GDP

  4. Resource Allocation
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Capital formation is the process of increasing the stock of real capital, such as machinery, equipment, and infrastructure, within an economy.

Multiple choice economics concept of consumption function, saving function and investment function capital economy of a village wealth, capital and money

"Capital" is considered as a "produced means of production". This statement is _________________.

  1. True

  2. False

  3. Partially True

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

Capital is not a natural resource; it is created by human effort to be used in further production, which is why it is called a produced means of production.