Tag: economics

Questions Related to economics

In Private banking .. percent FDI is allowed now _____________.

economics public debt public debt main feature of tax arbitration, tribunal adjudication and alternate dispute resolution

  1. 100

  2. 49

  3. 74

  4. 26

Show answer
Correct Option: C

Which of the following is most likely to cause an increase in the size of the national debt?

economics public debt public debt main feature of tax arbitration, tribunal adjudication and alternate dispute resolution

  1. An increase in taxation

  2. A rise in long-term government borrowings

  3. An increase in national income

  4. A reduction in government expenditure.

Show answer
Correct Option: B

Which of the following contributes most to India's external debt?

economics public debt public debt main feature of tax arbitration, tribunal adjudication and alternate dispute resolution

  1. IMF loans

  2. External commercial borrowings

  3. External assistance

  4. None of the above

Show answer
Correct Option: C

Quantum of concessional debts in total external debt of India has ___________.

economics public debt public debt main feature of tax arbitration, tribunal adjudication and alternate dispute resolution

  1. increased

  2. decreased

  3. doubled

  4. remain same.

Show answer
Correct Option: B

India receives about _______% of the external assistance in the form of loans. 

economics public debt public debt main feature of tax arbitration, tribunal adjudication and alternate dispute resolution

  1. 10%

  2. 30%

  3. 60%

  4. 90%

Show answer
Correct Option: D

The word 'public debt' was not well known to the people till the late _______ century.

economics public debt public debt main feature of tax arbitration, tribunal adjudication and alternate dispute resolution

  1. 16th

  2. 17th

  3. 18th

  4. 19th

Show answer
Correct Option: C

Equilibrium beyond the full employment level does not lead to rise in output level. 

economics theories of distribution unemployment and employment generation the short run fixed price analysis of the product market liquidity preference and profit

  1. True

  2. False

Show answer
Correct Option: A
Explanation:

The level of output will not rise as economy is already at full employment level and there is no idle capacity in the economy.

According to Keynes, the equilibrium level of income is always determined corresponding to full employment level. 

economics theories of distribution unemployment and employment generation the short run fixed price analysis of the product market liquidity preference and profit

  1. True

  2. False

Show answer
Correct Option: B
Explanation:

False.
 The equilibrium level on income may be determined at a level less than full employment where the market is clear even in under utilization of resources , more than the full employment where market is clear even if resources are over utilized or equal to level of full employment. 

 In determination of Equilibrium Level of Income by AD-AS approach, AD curve is represented by ____________.

economics theories of distribution unemployment and employment generation the short run fixed price analysis of the product market liquidity preference and profit

  1. (C + S) curve

  2. (C + I) curve

  3. (S + I) curve

  4. (C +Y) curve

Show answer
Correct Option: A
Explanation:

Aggregate Demand refers to the desired level of expenditure in the economy during an accounting year. It is what people wish to spend on the purchase of goods and services during an accounting year.

The Ad curve in income determination analysis represents a two sector economy which only includes the expenditure made by the consumer sector and the producer sector.

Therefore, aggregate demand = consumption + investment = C + I.

The two approaches to determination of the equilibrium level of income are:

economics theories of distribution unemployment and employment generation the short run fixed price analysis of the product market liquidity preference and profit

  1. Aggregate demand-Aggregate supply approach

  2. Saving-Investment approach

  3. Demand-Supply approach

  4. Both A & B

Show answer
Correct Option: D
Explanation:

Two approaches are:

1) Aggregate demand-Aggregate supply approach-
An economy is in equilibrium when aggregate demand for goods and services is equal to aggregate supply during a period of time.

So, equilibrium is achieved when:

AD = AS … (1)

We know, AD is the sum total of Consumption (C) and Investment (I):

AD = C + I … (2)

Also, AS is the sum total of consumption (C) and saving (S):

AS = C + S … (3)

Substituting (2) and (3) in (1), we get:

C + S = C + I.....(4)

2)Saving-Investment approach 

According to this approach, the equilibrium level of income is determined at a level, when planned saving (S) is equal to planned investment (I).

from equation( 4)

 S = I