Tag: economics

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Questions Related to economics

Multiple choice economics solution to basic economic problems under different economic systems supply curve and price determination in the market price mechanism and solutions supply

The government in a mixed economy seeks to control price mechanism through which of the following policies?

  1. Industrial policy

  2. Fiscal policy

  3. Monetary policy

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

In a mixed economy, price mechanism are intervened by the government through many policies which includes industrial policy i.e. industrial acts, wage rate system etc, fiscal policy i.e. taxation policy on goods and services, and monetary policy i.e. central bank's qualitative and quantitative policy.

Multiple choice economics solution to basic economic problems under different economic systems supply curve and price determination in the market price mechanism and solutions supply

_______________ price mechanism operates in a socialist economy.

  1. Administered

  2. Open

  3. Free

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

In a socialist economy, the price mechanism i.e. price affects the demand and supply of the commodities is directed by a centrally based planning authority that controls the price mechanism to certain limits and regulates it to protect civilians from fraudulent practices.

Multiple choice economics solution to basic economic problems under different economic systems supply curve and price determination in the market price mechanism and solutions supply

'From each according to his capacity and to each according to his work' is the principle of ___________, in a socialist economy.

  1. distribution of utilities

  2. distribution of income

  3. employment segregation

  4. wealth distribution
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation
In a socialist economy, the central problems of the economy is solved by a centrally based planning authority that resolves all the centrally based problems related to production of goods and services in the economy which includes the problem of 'For whom to produce?' is decided by allocating resources for the production keeping in mind the purchasing power of the nation according to their capacity and income earned and spent by them. 
Multiple choice economics solution to basic economic problems under different economic systems supply curve and price determination in the market price mechanism and solutions supply

The role played by price mechanism in a free-enterprise economy is taken up by the ___________ in a socialist economy.

  1. state governments

  2. central bank

  3. fiscal regulatory authority

  4. central planning authority
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

In a socialist economy, the price mechanism i.e. price affects the demand and supply of the commodities is directed by a centrally based planning authority that controls the price mechanism to certain limits and regulates it to protect civilians from fraudulent practices.

Multiple choice economics solution to basic economic problems under different economic systems supply curve and price determination in the market price mechanism and solutions supply

The decision regarding distribution of income is taken by the planning authority in a capitalist economy.

  1. True

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

Capitalist economies has private ownership where utilization of resources takes place for private gains, therefore here decision regarding the distribution of income and wealth is taken on the basis of the purchasing power of an individual where the private investors gain the maximum. 

Multiple choice economics solution to basic economic problems under different economic systems supply curve and price determination in the market price mechanism and solutions supply

The public sector under a mixed economy provides __________ so as to promote economic development.

  1. consumer goods

  2. economic infrastructure

  3. luxury goods

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

In a mixed economy, private decisions are intervened by the government due to which all the major economic decisions related to economic development is taken by the government i.e. public sector which includes economic infrastructure, development of health and education etc. 

Multiple choice economics solution to basic economic problems under different economic systems supply curve and price determination in the market price mechanism and solutions supply

Under mixed economy framework, free markets and price mechanism operate under the control and regulation of the government.

  1. True

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

In a mixed economy, private decisions are intervened by the government due to which there is problem in price mechanism where prices of a commodities are determined by the forces of demand which involves consumers and supply which involves producers and labours with exception set by government on some basic commodities. 

Multiple choice economics solution to basic economic problems under different economic systems supply curve and price determination in the market price mechanism and solutions supply

The government in a mixed economy controls production in _________  as well as _________ sector so as to ensure adequate availability of necessities.

  1. primary, industrial

  2. public, private

  3. banking, agricultural

  4. public, construction
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

In a mixed economy both private as well as public enterprises utilize the resources for the production of goods and services in  the economy for personal as well as social gains where government audits the overall production to ensure adequate availability of goods and services in the economy. 

Multiple choice economics solution to basic economic problems under different economic systems supply curve and price determination in the market price mechanism and solutions supply

The basic economic problems are solved in the public sector of a mixed economy through decision making by the planning authority.

  1. True

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

In a mixed economy, the public sector price mechanism i.e. price affects the demand and supply of the commodities is directed by a centrally based planning authority that controls the price mechanism to certain limits and regulates it to protect civilians from fraudulent practices.

Multiple choice economics solution to basic economic problems under different economic systems supply curve and price determination in the market price mechanism and solutions supply

In the private sector of a mixed economy, ____________ plays an important role in solving the basic economic problems.

  1. price mechanism

  2. planning authority

  3. government

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

In a private sector of a mixed economy, price mechanism takes a very prominent role as in such sectors price directs the flow of goods and services in the market as it directs the supply by the production sector i.e supply will increase if price increases and vice-versa and purchase by the demand sector i.e demand will increase if price decreases and vice-versa.