Macro economic theory mcqs with answers sem 3 - Study For Buddies

Wednesday, November 24, 2021

Macro economic theory mcqs with answers sem 3


MCQs - 50

1. The total sales of all firms in an economy in a given year is:

a) the same as gross national product
b) equal to that of national product
c) more than gross national product
d) less than gross national product

2. An estimate of national income... 

a) includes transfer payments
b) excludes parts of transfer payments
c) includes part of transfer payments
d) excludes transfer payments

3. Net National Product does not include...

a) indirect business taxes 
b) corporate income taxes
c) depreciation charges
d) the rental value of house-owners

4. A major part of a country's output is normally used for...

a) private consumption
b) investment
c) public consumption
d) exports

5. Expenditure of defense is an item of....

a) public investment 
b) private investment
c) private consumption 
d) public consumption

6. Net national product at factor cost is also known as:

a) net domestic product 
b) gross national product
c) national income 
d) a personal income

7. Double counting means...

a) counting a product more than once
b) counting a product at the final stage of output process 
c) counting both as product and as factor payment
d) counting both as "real goods" and as "money flow"

8. In a simple economy, National Income is:

a) equal to disposable income 
b) more than disposable income
c) less than disposable income
d) sometimes less than disposable income 

9. Monetary deficit is the....

a) government deficit on payments disbursement 
b) RBIs deficit due to outstanding dues
c) Net RBI credit to the Central Government
d) Difference between Government payment and receipts im monitoring term

10. Stagflation is a period of...

a) High inflation
b) High unemployment
c) Low unemployment
d) Both (a) and (b) above

11. Customs Duty is an instrument of:

a) Trade Policy
b) Monetary Policy
c) Fiscal Policy
d) Revenue Policy

12. Increase in net RBI credit to the Central Government is reflected in _________ deficit.

a) Budget
b) Revenue
c) Monetized
d) Gross Primary

13. Coulborn defines "inflation" as:

a) Too much money chasing too few goods.
b) Too much goods chasing too few money.
c) The issue of too much currency. 
d) The production of too much goods.

14. The rise in prices and the phenomenon of inflation....

a) Are not related to each other. 
b) Moves in the opposite direction.
c) Are inter-related.
d) None of the above.

15. Macroeconomics is the study of:

a) Inflation
b) Unemployment
c) Both (a) and (b)
d) None of the above

16. Which of the following methods is/ are used for measuring national income?

a) Output method
b) Income method
c) Expenditure method
d) All of the above

17. Personal income equals personal disposable income plus...

a) Personal savings
b) Transfers from government
c) Personal income taxes
d) Dividend payments

18. Which of the following is/are not included in the computation of GNP?

a) The price paid for a stolen car
b) Spending for National Defense
c) Rs. 10000 spent by a local government
d) Services of a teacher

19. Which of the following is not included in gross investment?

a) Business and residential construction
b) Expenditure on consumer goods
c) Additions to business inventory
d) Expenditure on machinery

20. Macro-economics is concerned with: 

a) The level of output of goods and services
b) The general level of prices
c) Both (a) and (b) above
d) None of the above

21. GDP at factor cost exceeds GDP at market price: 

a) When subsidies exceed indirect taxes,
b) When the factor income from abroad is negative.
c) When the factor income from abroad is positive.
d) When direct tax exceeds indirect tax.

22. The difference between GNP and GDP is: 

a) Depreciation
b) Net foreign income from abroad
c) Excess of indirect taxes over subsidies
d) Personal disposable income

23. Which of the following is closest to the concept of economic production?

a) Sales of goods and services for profit.
b) Manufacture of goods.
c) Addition to the stock of goods and services for future use.
d) Addition to the value of commodities.

24. Purchase of water cooler by a household is treated as national income as a part of:

a) Consumption at the time of its purchase
b) Capital formation
c) Consumption over a long period of time
d) Intermediate consumption

25. Difference between National-Capital and National Income is:

a) NC is a flow; NI is a stock.
b) NC is a stock; NI is a flow.
c) Both (a) and (b) above
d) None of the above

26. National income at constant price is also called _________ National Income.

a) Nominal
b) Real
c) Determinant 
d) None of the above

27. In a closed economy savings are equal to _______ at the equilibrium level of income.

a) Wages
b) Income-Investments
c) Wages-Consumption 
d) Investments 

28. If nominal income increases by 50 % & prices increase by 30%, the real income increases by...

a) 10% 
b) 20% 
c) 30% 
d) 40% 

29. A firm purchases inputs worth Rs. 5,000 process them and sell for Rs. 7500. Value addition by the firm is Rs. __________.

a) -2500 
b) 2500 
c) 5000 
d) 6250

30. National income data suffer greater inadequacies and in accuracies in:

a) developed countries
b) underdeveloped countries
c) in both kinds of countries 
d) in none of these countries

31. The three method of calculating national income measure...

a) the same thing from different angles
b) different things from different angles 
c) different things at the same angles
d) the same thing from the same angles 

32. In 2005 GNP at current prices was Rs. 750 compared to 2000 the price level was higher by 50 percent. In 2005 GNP at 2000 constant prices will be:

a) Rs. 750 
b) Rs. 600 
c) Rs. 500 
d) Rs. 450 

33. Double counting means counting the same value:

a) Twice
b) Three times
c) Four times 
d) More than one time

34. Transfer Payments include:

a) Old age pensions
b) Payments made by individuals to the state as a tax
c) Consumer's debt interest 
d) All of these

35. The national income of India is estimated by the:

b) Indian Statistical Institute
c) Planning Commission
d) Central Statistical Organization

36. Which of the following act as a leakage from the circular flow of spending and injection into the circular spending stream?

a) Consumption & Saving
b) Investment & Consumption 
c) Saving & Investment
d) Aggregate Demand & Aggregate Supply 

37. Which of the following is an example of a flow variable?

a) Change in money supply
b) Foreign exchange reserves
c) Consumer price index
d) Gross capital stock

38. National income does not include:

a) Interest on unproductive national debt 
b) Income from government expenditure
c) The payments by the households to J firms for the purchase of goods and j services
d) Undistributed profits 

39. Transfer payments refer to:

a) payments, made without any quid pro quo
b) transferring wealth outside the j country through fictitious payments
c) payments to employees at the time of transfer 
d) money transferred by one sector to another

40. Double counting leads to:

a) Under estimation of national product
b) Over estimation of national product 
c) Distortation of national product
d) None of the above

41. To remove inequalities, the Government uses....

a) Progressive taxes 
b) Regressive taxes
c) Indirect taxes
d) Proportional taxes

42. Which of the following is NOT a part of direct taxes?

a) Wealth Tax 
b) Profit Tax
c) Excise Duty
d) Income Tax

43. Which of the following variable(s) will come under stock variable(s)? 

a) Consumer price index
b) Gross domestic product
c) Exports
d) Both (a) and (c) above

44. Which of the following variable(s) will come under flow variable(s)?

a) Unemployment
b) Consumption
c) Foreign exchange reserves
d) Money supply
45. Gross domestic savings is the difference between: 

a) GDP and GNP
b) GDP and GDFC
c) GDP and Aggregate Consumption
d) NDI and GDP

46. The act of replacing worn out assets are creating new assets is capital formation. Then Gross Domestic Capital Formation (GDCF) consists of: 

a) Making good the depreciation an existing fixed assets
b) Adding to the stock of fixed assets
c) Adding to inventories
d) All of the above

47. Which of the following ratios best describes the GNP deflator?

a) Real GNP to Nominal GNP.
b) Nominal GNP to Real GDP.
c) Nominal GNP to Real GNP. 
d) Real GNP to Nominal GDP.

48. GDP at market prices exceeds GDP at factor cost by the amount of revenue raised through:

a) Direct Taxes
b) Income Tax
c) Tax on rents
d) Indirect Taxes

49. Which of the following is not true in representing the GDP at market price and GDP at factor price?

a) In GDP at market price, exports are not considered
b) In GDP at factor price, indirect taxes are not considered
c) In GDP at factor prices, subsidies are not considered
d) In GDP at market prices, exports considered

50. Net factor income from abroad is equal to: 

a) NNP at market prices - NDP at market prices
b) NDP at factor cost + Depreciation
c) NDP at factor cost - Depreciation
d) NNP at market prices Depreciation

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