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Thursday, September 30, 2021

Elements of direct taxes

September 30, 2021 0
Elements of direct taxes


What is tax?

• Tax is a price which is paid by every citizen of country for social welfare what he / she avails.

• Cost of living in a society

Why are taxes levied?

• The reason for levy of taxes is that they constitute the basic source of revenue to the Government. Revenue so raised is utilized for meeting the expenses of Government like defence, provision of education, health-care, infrastructure facilities like roads, dams etc.

Types of tax 

Types of Tax

• Direct Taxes : If tax is levied directly on the income or wealth of a person, then, it is a direct tax. The person who pays the tax to the Government cannot recover it from somebody else i.e. the burden of a direct tax cannot be shifted. e.g. Income- tax.

• Indirect Taxes : If tax is levied on the price of a good or service, then, it is an indirect tax e.g. Goods and Services Tax (GST) or Custom Duty. In the case of indirect taxes, the person paying the tax passes on the incidence to another person.

Assessment & Previous Year

• Assessment Year- It is a year in which assessee pays tax for Previous Year. 

• Previous Year- It is a year in which assessee earns income.

Income Tax Law

• Two Acts are more important -

i. Income Tax Act, 1961
- Provisos and Explanations
- sub-sections or clauses and sub-clauses 

ii. Annual Finance Act - Fixation of tax rate 

Important Definitions

• Assessment Year u/s 2(9)
• Previous Year u/s 3
• Assessee u/s 2(7)
• Person u/s 2(31)
• Gross Total Income u/s 14
• Income u/s 2(24)

Assessment Year u/s 2(9)

• Means -

The period starting from April 1 and ending on March 31 of next year. Thus, the assessment year 2021-22 commences on April 1, 2021 and ends on March 31, 2022. Income of pervious year of an assessee is taxed during the next following year at the rate prescribed by relevant Finance Act. 

Previous year u/s 3 

• Means - 
The year in which income is earned is known as previous year and the next year in which income is taxable is known as assessment year.

In our syllabus, we will consider A.Y 2021-22 and P.Y. 2020-21 throughout the semester.

Assessee u/s 2(7)

• It includes -

i. A person who files tax return though his income is less than Rs. 2,50,000. 

ii. A person who doesn't file tax return though his income is more than Rs. 2,50,000

iii. A person in respect of whom any proceeding under the Act has been taken 

iv. Deemed Assessee

Person u/s 2(31)

• The term person includes-

a. An Individual
b. A Hindu Undivided Family 
c. A company 
d. A firm 
e. An AOP or BOI, whether incorporated or not 
f. A local authority; and 
g. Every artificial juridical person not falling within any of the preceding categories 

Gross Total Income u/s 14 

• As per section 14, income of a person is computed under the following five heads: 

1. Salaries 
2. Income from house property 
3. Profits and gains of business or profession 
4. Capital gains 
5. Income from other sources 

The aggregate income under these heads is termed as "gross total income". 

Income u/s 2 (24)

• It is inclusive definition as it includes- 

- Profits and gains 
- Dividend 
- Anv allowance
- Winning from lottery
- Compensation 
- Consideration etc.

 Tax v/s Duty 



In case of tax, person earns income and then pays tax to government.

In case of duty, person pays tax and then he may earn income by selling the product or he may consume himself.

For eg. Income tax

For eg. Custom duty 

Deduction v/s Exemption



Deduction is generally given from Income chargeable to tax. Deduction can be less than or equal to or more than amount of income. If amount deductible is more than the amount of income, the resulting amount will be taken as loss

If an income is exempt from tax, it is not included in the computation of income. Exemption can never exceed the amount of income.

Method of Accounting 

Income chargeable under the head "Profits and gains of business or profession" or " Income from other sources" is to be computed in accordance with the method of accounting regularly employed by the assessee.

In other cases, method of maintaining books of account is irrelevant. 

Income tax slabs under the new tax regime for all individuals for FY 2020-21
(Applicable from A.Y. 2021-22)

Income Tax Slab

Tax Rate

Up to Rs 2.5 lakh


Rs. 2.5 lakh to Rs. 5 lakh

5% (tax rebate of Rs.12,500 available under under section 87A)

Rs. 5 lakh to Rs. 7.5 lakh


Rs. 7.5 lakh to Rs. 10 lakh


Rs. 10 lakh to Rs. 12.5 lakh


Rs. 12.5 lakh to Rs. 15 lakh


Rs. 15 lakh And above


Income Tax Slabs & Rates for Individual Tax Payers & HUF (Less Than 60 Years Old) for FY 2020-21- 
Part I
(A. Y. 2021-22) 

Income Tax Slab

Tax Rate for Individual & HUF Below the Age Of 60 Years

Up to Rs. 2,50,000


Rs.2,50,001 to Rs. 5,00,000

5% of total income exceeding Rs.2,50,000

Rs. 5,00,001 to Rs. 10,00,000

Rs. 12,500 + 20% of total income Exceeding Rs.5,00,000

Above Rs.10,00,000

Rs. 1,12,500 + 30% of total income exceeding Rs. 10,00,000 

 Computation of Tax: An outline

I. Aggregate of income under 5 heads 

Salary                                                        xxx
Income from House Property                xxx
Profit and gain of Bus. Or Profession   xxx
Capital Gain                                             xxx
Income from other sources                   xxx
Gross Total Income                               xxx

II. Less: Deduction (80C to 80U)         xxx
Net Income/Total Income                    xxx

III.Calculation of Tax using applicable tax slab 

IV. Less: Rebate upto Rs. 12500 if net income is less than or equal to Rs. 500000 

V. Add: Surcharge if applicable 

VI. Add: Health and education tax @ 4% on tax liability 


• Mr. Dev is an Indian citizen (age: 56 years). He has received salary of Rs. 800000 in the year 2019-20 and also paid LIC premium of Rs. 72000 in the same financial year. Calculate his lax liability for the assessment year 2020-21. 

Ans. Salary                      800000
Less: Deduction             (72000)
Net Income                      728000 
728000-250000 (exempt) 
= 478000 - 250000 (5% on 250000) = 12500 
= 228000 @20% = 45600 
 tax libility = 12500 + 45600 
                  = 58100 @ 4% (HEC) = 2324          Total tax = 58100 + 2324 
                  = 60424


• Mr. Dev is an Indian citizen (age: 66 years). He has received salary of Rs. 750000 in the year 2019-20 and also paid LIC premium of Rs. 72000 in the same financial year. He has also received rental income of Rs. 50000 from house property in the financial year 2019-20. Calculate his lax liability for the assessment year 2020-21. 

• Mr. Dev is an Indian citizen (age: 86 years). He has received salary of Rs. 700000 in the year 2019-20 and also paid LIC premium of Rs. 72000 in the same financial year. He has also received rental income from house property of Rs. 100000 in the financial year 2019-20. Calculate his tax liability for the assessment year 2020-21. 

Broad principles which clarify the concept of income 

• Meaning of income as generally understood: 

- Periodical monetary return 
- Regularity 
- True increase in the amount of wealth which comes to a person during a fixed period of time. 


1. Regular and definite sources 
2. Different form of income 
3. Receipt vs Accrual
4. Illegal Income 
5. Disputed Title
6. Relief or reimbursement of expenses not treated as income 
7. Diversion of income by overriding title vs Application of income 
8. Surplus from mutual activity 
9. Temporary and permanent income 
10. Lump sum receipt
11. Tax free income 
12. Receipt on account of dharmada, gaushala etc. 
13. Devaluation of currency 
14. Income includes loss
15. Appropriation of payment between capital and interest 
16. Same income cannot be taxed twice
17. Income should be real not fictional 
18. Source of income need not exist in the assessment year 
19. Pin Money 
20. Award received by a sportsman 
21. Revenue receipt vs Capital receipt 
22. Voluntary payment 
23. Prize on winning a motor rally 
24. Burden of proof 

Incidence of Tax 

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Organizational Behaviour

September 30, 2021 0
Organizational Behaviour



• Meaning & definition of OB 
• Importance of OB 
• Nature of OB 
• Scope of OB 
• OB Framework 
• Contributing Disciplines to OB 
• SOBC model of OB


• Three features 
  1. Study of human behaviour 
  2. Behaviour in organizations 
  3. Useful in improving an organization’s effectiveness


• OB refers to the behaviour of individuals and groups within organizations and the interaction between organizational members and their external environment. 

• OB is a field of study that investigates the impact that individuals, groups and structure have on behaviour within organizations for the purpose of applying such knowledge towards improving an organization's effectiveness
• OB comprises individual behaviour, group behaviour and of the organization itself. 

• Influence of environment on the interface between individuals and organizations cannot be overlooked. 

• The field of OB is both exciting and complex 

• OB has emerged as distinct field of study.


1. OB provides a road map to our lives in organization. 

2. OB uses scientific research to helo us understand and predict organizational life. 

3. OB helps us influence organizational events. Though it is good to understand and predict organizational events, most of us want to influence the environment in which he or she lives. 

4. OB helps an individual understand himself/herself and others better.

5. Manager in a business establishment is concerned with getting things done through delegation. 

6. The field of OB is useful for maintaining cordial industrial relations. Human problems need to be tackled humanely. OB helps in understanding the cause of the problem, predict its course of action and control its consequences. It serves as the basis for HRM. 

7. OB is also useful in the field of marketing. Innovation and the diffusion of new products, creativity and the learning of responses are important social and individual phenomena.

8.The post popular reason for studying OB is that reader is interested in pursuing a_ career management and wants to learn how to predict behaviour and apply it in some meaningful way to make organizations more effective. 

9.Last couple of years, Our economy has been witnessing an upward trend. In order to sustain this trend, effective management of all sectors. Effective management does not mean competent utilization of resources. It means. efficient management of HR. This is where OB comes into picture.


• A field of study and not a discipline : discipline is an accepted science with theoretical foundation that serves as the basis for research and analysis. OB because of its broad base, recent emergence and interdisciplinary orientation is not accepted as science. Synthesise principles, concepts and processes in OB field of enquiry . 

Interdisciplinary : integrates the relevant knowledge drawn from different disciplines for Specific purpose. OB integrates the relevant concepts from various disciplines to make them applicable for organizational analysis.

An Applied Science : basic objective is to make application of various researches to. solve organizational problems, particularly related to human behaviour aspect. OB is both science as well as art. 

Normative and Value centric : normative science prescribes how the various findings of the researches can be applied to get organizational results which are acceptable to the society. What is acceptable by the society or individuals engaged in organization is a matter of values of the society and people concerned
• Humanistic and Optimistic : OB focuses 
attention on people. It is based on the belief that needs and motivation of people are of high concern. Acceptance of value of the individual as a thinking, feeling organism. There is optimism abut the innate potential of man to be independent, creative, productive and capable of positively contributing to organizational objectives.

Oriented towards organizational objectives : OB emphasising human aspect of the organization is oriented towards organizational objectives. Organization may have several objectives and sometimes conflicting with individual 
objectives. OB tries to integrate two types of objectives so that both are achieved 

• A total system approach : the living system of an organization is viewed as an enlargement of a man. System approach is an integrative approach which takes into account all the variables affecting organizational functioning. The System thinking in organizational analysis developed by behavioural scientist. It does not take human being in isolation but as the product of socio-psychological factors. Behaviour is analysed keeping in view psychological, interpersonal orientation, group influence and social & cultural factors.


OB encompasses the study of: 

• Intrapersonal behaviour : personality, attitude, perception, learning , opinion, motivation, job satisfaction and stress management 

• Interpersonal behaviour : group dynamics, team dynamics, intergroup conflict, leadership, communication, transaction analysis and the like 

• About Organizations : their formation, structures, effectiveness and formal and informal organizations.

• The three levels of analysis are not necessarily mutually exclusive. The field of OB embraces them as being complementary. 

• There is no “One Best way” 

• Specialist in the field of OB today agree that there is no one best approach when it comes to studying human behaviour in organizations.


PSYCHOLOGY : science that seeks to measure, explain and sometimes change the behaviour of humans and other animals. Psychologists are concerned with problems of fatigue, boredom and other relevant to working conditions that could impede efficient work performance. 

Sociology : studies people in relation to their fellow human beings. Sociologists contribution to OB through their study of group behaviour in organizations, particularly formal and complex organizations.

• Social Psychology : blending concepts from both sociology and psychology and focuses on the influence of people on one another. Considerable investigation from social psychologists has been change - implement and reduce barriers. 

• Anthropology : study of societies to learn about human beings and their activities. Anthropologists work on cultures and environments, helps us understand differences in fundamental values, attitudes and behaviour among people in different countries and within different organization.

Political Science : study of the behaviour of individuals and groups within political environment. It studies the behaviour of individuals and groups within a political environment.


• S-O-B-C model incorporates more complex mechanism of human behaviour which modifies and extends S-O-R model. 

• S-O-R model stands for Stimulus, Organism, Response. 

S-O-B-C stands for Situation, Organism, Behaviour pattern and Consequence. 

• S- Situation - more comprehensive than stimuli and incorporates all aspects of the environment immediate stimuli, physical environment and socio-cultural environment

• O - Organism - does not only represent physiological being as in S-O-R model but also psychological being which is more complex. 

• B- Behaviour pattern both overt and covert 

C- Contingent consequences 

• The interaction pattern among different elements of human behaviour model is not simple one but complex because of 2 reasons: 

(A) different variables with each elements which interact among themselves.
(B) Organisms is not physiological being 

• Only O interacts with the situation and base on his own nature he may perceive the situation ina particular way and behave accordingly. 

• Though SOBC model tries to explain the process of human behaviour, it presents only a bare bone sketch of the behaviour.

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Friday, September 24, 2021

Quantitative techniques (QT) Mcqs

September 24, 2021 0
Quantitative techniques (QT) Mcqs

MCQS - JULY 2021

1. If the z table value is 2.58, what is the desired level of confidence? 

A. 99% 
B. 90% 
C. 95% 
D. 100%

2. There is no significance relationship between any two variables is known as

A. Null Hypothesis 
B. Simple Hypothesis 
C. Alternate Hypothesis 
D. One way Hypothesis

3. Combined mean is calculated when we have _________.

A. Information of two groups
B. Information if single group
C. Information of more than four groups
D. No information is available

4. If the null hypothesis is false then which of the subsequent is accepted? 

A. Null Hypothesis 
B. Positive Hypothesis
C. Negative Hypothesis 
D. Alternative Hypothesis

5. Alternative Hypothesis is also called as? 

A. Composite hypothesis
B. Research Hypothesis
C. Simple Hypothesis
D. Null Hypothesis 

6. Type 1 error occurs when?

A. We reject H0 if it is True 
B. We reject HO if it is False 
C. We accept H0 if it is True
D. We accept HO if it is False

7. If the sample size is less than 30, which test should be used?

A. t-test 
B. chi-square test 
C. z-test 
D. f-test

8. A statement made about a population for testing purpose is called? 

A. Statistic 
B. Hypothesis 
C. Test Statistic
D. Significance level

9. How many types of error may occur when testing the hypothesis?

A. Only 1 type 
B. 2 type 
C. 3 type 
D. 0 type

10. The rejection probability of Null Hypothesis when it is true is called as?

A. Level of Rejection
B. Level of Significance 
C. Level of Margin
D. Level of Confidence

11. The probability of committing a type 1 error is denoted by ________.

A. x 
B. E 
C. alpha 
D. bita 

12. In regression, the equation that describes how the response variable (y) is related to the explanatory variable (x) is:

A. the correlation model
B. the regression model
C. used to compute the correlation coefficient
D. None of these alternatives is correct

13. Find the correct statement.

A. Mean is positional average 
B. Median is positional average 
C. Median is arithmetic average
D. Mode is positional average

14. In regression analysis, the variable that's being predicted is the

A. response, or dependent, variable
B. independent variable 
C. is usually x
D. intervening variable 

15. For 90% desired level of confidence, what is the z table value? 

A. 1.65 
B. 1.96 
C. 2.56 
D. 1.57

16. When the population is heterogeneous and characteristics are unknown, which test should be used? 

A. Chi-square test
B. t-test
C. z-test
D. f-test

17. When the correlation is only studied between 2 variables it's known as

A. Positive correlation 
B. Negative correlation 
C. Multiple correlation 
D. Simple correlation 

18. If the proportion of success(p) is given, what is the proportion of failure(q)? 

A. 1-q 
B. 1-p 
C. p+1 
D. 1+q

19. Sample size is known as ______

A. n
B. N
C. s
D. S

20. Level of significance is 5% so, what is the level of confidence?

A. 95%
B. 5%
C. 50%
D. 105%

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Wednesday, September 15, 2021

Behaviourial Sciences in Management (BSM) Mcqs

September 15, 2021 0
Behaviourial Sciences in Management (BSM) Mcqs

MCQS : JULY 2021

1. _____ is a study of commonly shared values, beliefs, customs, traditions and rituals.

A. Cultural anthropology
B. Psychology
C. Biology
D. Economics

2. Which of the following is not a social science?

A. Sociology
B. Anthropology
C. Physics
D. Psychology

3. Who has suggested the need hierarchy Theory of motivation?

A. Abraham maslow
B. Fredrick Herzberg
C. David me clelland
D. Victor vroom

4. Group behaviour, power and conflict are central areas of study for 

A. Sociologist
B. Anthropologists
C. Psychologists
D. Operations analysts

5. An acquisition of power in a competitive environment is studied by _____ science.

A. Political
B. Anthropological
C. Social 
D. Psychological

6. If a specific behavior and gets strendthened and the probability of repeating the same increases, then it is know as __________.

A. Reinforcement
B. Punishment
C. Extinction
D. Attribution

7. If a specific behavior gets strengthened and the probability of a repeating the same increases, as a result of application of favorable consequences, then it is know as _________

A. Positive reinforcement
B. Negative reinforcement
C. Punishment
D. Extinction

8. Most of the learning that takes place in the class room through lecture method is called ______

A. Classical conditioning
B. Cognitive learning
C. Operant conditioning
D. Social learning

9. According to Fishbein Multi Attribute model, attitude towards object can be measured through __________.

A. Ao = Sum of bi ei 
B. Ao = Sum of bi ci
C. Ao = Sum of ai di 
D. Ao = Sum of ci ei 

10. Organization Behavior is

A. An interdisciplinary approach
B. A General approach 
C. A Tactical approach
D. A Specialized Approach

11. Psychology's major contributions to the field of organizational behavior have been primarily at what level of analysis?

A. The level of the group 
B. The level of the individual
C. The level of the culture 
D. The level of Nation

12. Who has propounded the Achievement Motivation Theory?

A. Abraham Maslow
B. Victor Vroom 
C. Mc Clelland
D. Fredrick Herzberg

13. Who has advocated the Two Factor theory of Motivation? 

A. Fredrick Herzberg 
B. Abraham Maslow 
C. F. W. Taylor
D. Victor Vroom 

14. Hawthorne Studies is related to which stage of the organizational behavior evolution

A. Industrial revolution
B. Scientific management
C. Organizational behavior
D. Human relations movement

15. If a specific behavior gets weakened and the probability of repeating the same decreases, as a result of withdrawal of favorable consequences, then it is known as ______

A. Positive Reinforcement
B. Extinction
C. Negative Reinforcement
D. Punishment

16. Which of the following is not true of classical conditioning? 

A. Classical conditioning is passive.
B. Classical conditioning can explain simple reflexive behaviors 
C. Learning a conditioned response involves building an association between a conditioned stimulus and an unconditioned stimulus 
D. An unconditioned stimulus takes on the properties of a conditioned stimulus

17. Attributing one's own characteristics to other people. 

A. Projection
B. Halo effect
C. Attribution 
D. Stereo type

18. Which of the following behavior is not a part of study of Consumer Behavior ?

A. Consumption Behavior
B. Disposal Behavior
C. Buying Behavior 
D. General Behavior

19. _____ Is a relatively permanent change in behaviour that occurs as a result of experiences, information processing and observations.

A. Learning
B. Perception
C. Motivation
D. Skills

20. ____ is to be considered as a like game people play.

A. Feeling
B. Behaviour
C. Perception
D. Attitude

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Tuesday, August 17, 2021

New enterprise and innovations management Mcqs

August 17, 2021 1
New enterprise and innovations management Mcqs


1. To get an external financing, an entrepreneur's plan must pass three tests: reality test, value test and __________.

a) Talent test 
b) Financial test 
c) Competitive test 
d) Investor test

2. Costs are managed and budgeted based on the percentage of __________.

a) Net sales 
b) Net profit 
c) Income
d) Fiscal deposit

3. Assuming the necessary __________ is one of the aspects of entreprenurship.

a) Financial aids 
b) Risks
c) Investors 
d) Employees

4. The ______ is one in which the entrepreneur involves others in decision making process. 

a) Mixed management style 
b) Participative management style 
c) Centralised management style 
d) Change catastrophe

5. Changes in _________ are a major reason for growth of entrepreneurship. 

a) Consumer tastes 
b) Governmental policy 
c) Political power 
d) Service sector

6. _________ is a process in which persons are injected with motivations operations of achieved and in right to fact fully tackle uncertain and risky situations especially in business undertakings. 

a) Financial process 
b) Liberalization 
c) Entrepreneurial support system 
d) Selection

7. The _________ principle requires an entrepreneur to focus on most important issues, even under pressure.

a) Analysis 
b) Effectiveness 
c) Desire 
d) Time

8. A __________ is an original, functional model of a new product that entrepreneurs can put in the hands of potential customers so that they can see it, test it, and use it. 

a) Forecasts 
b) Articles 
c) Prototype
d) Trade associations

9. Too much ________ to meet consumer demands can be a drain on cash flow since manufacturing, transportation and storage costs would be borne by the venture. 

a) Cash flow 
b) Capital 
c) Inventory 
d) Demand and supply

10. Building organizational knowledge is necessary, and it is known as __________

a) Storing 
b) Record keeping 
c) Manufacturing 
d) Tax consultation

11. __________ strategy attempts to penetrate this product or market further by encouraging existing customers to buy more of the firm's current products. 

a) Diversification 
b) Integration 
c) Penetration 
d) Product making

12. The shops that sell the ski accessories can sell tennis racquets and mountain bikes during summer. This kind of a strategy is known as  __________.

a) Investment strategy 
b) Product development strategy 
c) Vertical integration 
d) Diversification strategy

13. A ________ is privately held and usually achieves only modest growth due to the nature of the business, the objectives of the entrepreneur and the limited money devoted to research and development. 

a) Foundation company 
b) High potential venture
c) Lifestyle firm 
d) LLP

14. The ________ is one of the conduit for commercializing the results of the synthesis of social need and technology. 

a) Innovators 
b) Investors
c) Government
d) Founders

15. In-spite of the importance of investment and innovation in the economic development of an area, there is still lack of understanding of __________.

a) Talent management
b) Marketing management 
c) Product-evolution process 
d) Technological processes

16. A __________ that values an individual who successfully creates a new business will spawn more venture formations than one that does not. 

a) Culture
b) Sub-culture 
c) Family 
d) Peer

17. __________ strategy involves the new product use as a part of it.

a) Integration
b) Sales
c) Market development
d) Diversification

18. One of the pressures that an entrepreneur faces as a challenge is __________.

a) Pressure on entrepreneur's time 
b) Pressure on the demand creation 
c) Pressure of the technology 
d) Pressure of the contracts

19. The growth opportunities occurs at the same level of the value added chain but simply involves a different but complementary value added chain. This is known as __________.

a) Backward integration 
b) Forward integration 
c) Horizontal integration 
d) Vertical integration

20. A __________analysis determines the degree to which a product or service idea appeals to potential customers and identifies A the resources necessary to produce the product or provide the service. 

a) Remedial action research 
b) Product and service feasibility analysis
c) Pilot surveys 
d) Focus group study

21. Periodically reviewing time management process and revisiting potential opportunities for delegation comes under the principle of __________.

a) Team work 
b) Desire 
c) Prioritised planning 
d) Reanalysis 

22. The entrepreneurial process has __________ distinct phases. 

a) Two 
b) Four 
c) Three 
d) Five

23. Entrepreneurship is the process of creating something new with __________ by devoting the necessary time and effort. 

a) Creativity 
b) Value 
c) Devotion 
d) Principles

24. __________ strategy involve selling a new product to a new market. 

a) Diversification 
b) Market product development 
c) Product development
d) Penetration

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Wednesday, July 21, 2021

Elements Of Economics Theory - Mcqs

July 21, 2021 0
Elements Of Economics Theory - Mcqs


1) Which one of the following is NOT an aspect of the assumption of rationality?

A) Complexity in behavior
B) Consistency in behavior
C) Complete information
D) Clarity of purpose

2) Which of these does not line within the scope of Managerial Economics?

A) Profit management
B) Demand analysis
C) Cost and production analysis
D) Balance of Payments

3) Identify which of these does not satisfy the basic assumptions of economics.

A) A worker cannot work for 24 hours a day
B) Apples cannot grow in dessert region
C) A consumer aims at maximization of satisfaction
D) A businessman may maximize profits by trading in illegal goods.

4) __________ is also known as aggregative economics.

A) Managerial Economics
B) Micro Euonomics
C) Business Economics
D) Macro Economics

5) According to __________ Economics is a study of man's action in the ordinary business of life.

A) Alfred Marshall
B) Paul Samuelson
C) Adam Smith
D) Lionel Robbins

6) Which of these is the reason that makes Marshall's definition oí Economics classificatory in nature?

A) It classifies welfare into material and non material welfare
B) It classifies economics into microeconomics and macroeconomics
C) It classifies resources into scarce and abundant
D) None of the above

7) Economic growth is best depicted by ________.

A) Upward movement on the given PPC
B) Outward shift in PPC
C) Downward movement on the given PPC
D) Inward shift in PPC

8) Price mechanism works efficiently provided there is:

A) Stability in the value of money
B) Existence of perfect competition
C) Reasonable equality in the distribution of wealth
D) All of the above

9) Which of these statements is true?

A) All values can rise or fail together
B) All wealth is money
C) All prices can rise or fall together
D) Only economic goods possess utility

10) Under economic statics

A) All variables refer to different points of time.
B) The concern is only with the final outcome of the relationship between variables
C) The entire process of change is traced
D) Supply in time period t is a function of Price in time period t - 1.

11) Those goods whose supply is limited in relation to their demand is known as

A) Scattered goods 
B) Economic goods 
C) Abundant goods
D) Free goods

12) When an object after having been disturbed restore its original position, it is a case of

A) Static Equilibrium
B) Stable Equilibrium
C) Unstable Equilibrium
D) Neutral Equilibrium

13) Which of these factors can cause competition to become imperfect?

A) Product is homogeneous
B) Product is heterogeneous
C) Sellers are price makers
D) B and C

14) Economic forces do not get sufficient time to bring about complete adjustment in the case of __________ equilibrium.

A) Short tem
B) Long term
C) Partial
D) General

15) Under perfect competition, the shape of AR and MR curves is __________.

A) Horizontal straight line
B) Vertical straight line
C) Parallel to X-axis
D) Both Aand C

16) The shape of AR and MR curves under imperfect competition is __________.

A) Vertical straight line
B) Hovizontal straight line
C) Upward sloping
D) Downward sloping

17) Match list (a) with list (b)

List (a)

List (b)

i. Raw materials

1. Non durable good

ii. Air

2. Free good

iii. Roads

3. Intermediate good

iv. Toothpaste

4. Public good

A) i - 2, ii - 1, iii - 3, iv - 4
B) i - 3, ii - 2, iii - 4, iv - 1
C) i - 4, ii - 3, iii - 1, iv - 2
D) i - 3, ii - 4, iii - 2, iv - 1

18) Match list (a) with list (b)

List (a)

List (b)

i. L. Robbins

1. Welfare approach

ii. A. Marshall

2. Wealth approach

iii. A. Smith

3. Economics is what the economists do.

iv. J. Viner

4. Scarcity approach

A) i - 4, ii - 3, iii - 2, iv - 1
B) i - 1, ii - 2, iii - 3, iv - 4
C) i - 4, ii - 1, iii - 2, iv - 3
D) i - 4, ii - 2, iii - 1, iv - 3

19) The three basic propositions of the 'Scarcity' definition of economics are

A) Ends, Scare Means & Alternative Uses
B) Ends, Wealth and Welfare
C) Wealth, Welfare & Money
D) Utility, Scarcity and Transferability

20) Which one of the following is NOT a fundamental economic problem?

A) How to allocate resources
B) What technique of production of use
C) Population explosion
D) How to distribute National Income

21) Any combination of two goods lying inside the production possibility frontier represents _______ of resources.

A) Growth
B) Scarcity
C) Under utilization 
D) Full utilization

22) The underlying assumptions (s) for the Price Mechanism to function efficiently is/are

A) Perfect Competition 
B) Stable Monetary System 
C) Free Market
D) All of the above

23) Which of the following is NOT an area of Microeconomics?

A) Producer's equilibrium
B) Consumer's equilibrium
C) Theory of factor pricing
D) Inflation

24) Which of these is a limitation of 'Robbins' definition of Economics?

A) It classifies welfare into material and non material welfare
C) It is Universal in nature
C) It covers only microeconomics
D) All of the above

25) Utility means ___________.

A) Satisfaction derived from consumption
B) Usefulness of a good
C) Power of a good to satisfy a want
D) Pleasure derived from consuming a good

26) Luxury is defined as ___________ consumption.

A) Necessary
B) Subsistence
C) Comfort
D) Superfluous

27) Any commodity to have exchange value must possess three attributes:

A) Form, place, time
B) Utility, scarcity, transferability
C) Utility, abundance, marketability
D) Satisfaction, usefulness, pleasure

28) Increase in economic goods is synonymous with increase in __________.

A) Wealth
B) Welfare
C) Utility
D) Desire

29) Which of these statements is true with regard to Capital goods?

A) They are known as goods of the first order
B) They are used for final consumption
C) They are known as goods of he second order 
D) They give satisfaction directly

30) Which of these is a characteristic of durable goods?

A) They have single use
B) They are repairable
C) They are purchased repeatedly
D) They are perishable

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