demand & supply, profit loss, inflation & price index section 2 MCQ Questions & Answers Detailed Explanation
MOST IMPORTANT indian economy mcq - 3 EXERCISES
The following question based on Demand & Supply, Profit Loss, Inflation & Price Index topic of indian economy mcq
- Efficiency occurs when no possible re-organisation of production can make anyone better off without making someone else worse off
- An economy is clearly inefficient if it is inside the Production Possibility Frontier (PPF)
- At a minimum, an efficient economy is on its Production Possibility Frontier (PPF)
- The terms such as ‘ Pareto Efficiency’, ‘Pareto Optimality’ and ‘Allocative Efficiency’ are all essentially one and same which denote ‘efficiency in resource allocation’
(a) 2 and 3 only
(b) 1 and 4 only
(c) 1 and 3 only
(d) 1, 2, 3 and 4
The correct answers to the above question in:
Answer: (b)
When the re-organisation of production is not possible which can make anyone better off without making someone else worse off then efficiency occurs.
Pareto Efficiency, Pareto Optimality and Allocative Efficiency are all the same and indicates “efficiency in resource allocation”.
Practice Demand & Supply, Profit Loss, Inflation & Price Index (demand & supply, profit loss, inflation & price index section 2) Online Quiz
Discuss Form
Read more demand supply profit loss inflation price index Based Indian Economy Questions and Answers
Question : 1
Consider the following statements :
- Inflation benefits the debtors.
- Inflation benefits the bond-holders.
a) Both 1 and 2
b) 2 only
c) 1 only
d) Neither 1 nor 2
Answer »Answer: (c)
Inflation redistributes wealth from creditors to debtors i.e., lenders suffer and borrowers benefit out of inflation.
Bondholders = this person has lent money (to debtors) and received bonds in return.
So he is a lender, he suffers, by the way, they haven’t specifically used the word – “inflation-indexed bonds”, hence we cannot say inflation benefits the bond-holders.
Question : 2
In India, inflation is measured by the
a) Producer Price Index
b) National Income deflation
c) Wholesale Price Index number
d) Consumers Price Index
Answer »Answer: (d)
Question : 3
What is meant by ‘Public Good’?
a) A commodity whose benefits are indivisibly spread among the entire community
b) A Government scheme that benefits the poor households
c) A commodity produced by the Government
d) Any commodity that is very popular among general public
Answer »Answer: (a)
Public good means a commodity or service which is given without profit to everyone in a society by government or any organisation.
Question : 4
Which is incorrect about inflation?
a) For some commodities retail prices are also considered for measurement of inflation
b) Inflation rate going down does not mean prices are declining
c) Inflation indicated the rise in the price of basket of commodities on a point-topoint basis
d) The inflation rate in India is calculated on the basis of the wholesale price index
Answer »Answer: (c)
Question : 5
The process of curing inflation by reducing money supply is called
a) Disinflation
b) Cost-push inflation
c) Down–pull inflation/Demand pull inflation
d) Reflation
Answer »Answer: (a)
The process of curing inflation by reducing the money supply is called disinflation.
Disinflation is a decrease in the rate of inflation – a slowdown in the rate of increase of the price level of goods and services in GDP. Cost pull inflation - It is caused by an increase in prices of inputs like Labour, raw material etc.
The increased price of the factors of production leads to the decreased supply of Goods. Demand-pull inflation - It is asserted to arise when Aggregate demand in an economy outpaces aggregate supply.
It involves inflation rising as real GDP rises and unemployment falls.
Question : 6
An exceptional demand curve is one that slopes
a) upward to the right
b) horizontally
c) downward to the right
d) upward to the left
Answer »Answer: (a)
When the curve slopes downwards from left to right; higher prices reduce the quantity demanded.
GET Demand & Supply, Profit Loss, Inflation & Price Index PRACTICE TEST EXERCISES
demand & supply, profit loss, inflation & price index section 1
demand & supply, profit loss, inflation & price index section 2
demand & supply, profit loss, inflation & price index section 3
Demand & Supply, Profit Loss, Inflation & Price Index Shortcuts and Techniques with Examples
Verbal Reasoning
Question & Answer Quiz
Non Verbal Reasoning
Question & Answer Quiz
Quantitative Aptitude
Question & Answer Quiz
Computer MCQ
Question & Answer Quiz
General English
Question & Answer Quiz
History GK
Question & Answer Quiz
Polity GK
Question & Answer Quiz
Geography GK
Question & Answer Quiz
Economy GK
Question & Answer Quiz
General Awareness GK
Question & Answer Quiz
Recently Added Subject & Categories For All Competitive Exams
IBPS Clerk Prelims 2024 Synonyms Questions Solved Answers
Most important IBPS Clerk Prelims 2024 Synonyms and Antonyms multiple choice questions and answers with detailed solutions, English vocabulary PDF Download
Continue Reading »
New Cloze Test Questions and Answers PDF - IBPS Clerk 2024
The most important Cloze Test questions with detailed answers for upcoming IBPS Clerk prelims 2024. Latest English verbal ability practice MCQs, PDF
Continue Reading »
Mensuration Aptitude Practice Mcq Questions IBPS Clerk 2024
Most Important Practice Mensuration aptitude multiple choice questions, answers with detailed solutions, PDF beginner to advanced for IBPS Clerk Prelims 2024
Continue Reading »
Top Clock Aptitude Questions and Answers PDF IBPS Clerk 2024
Recent Important IBPS Clerk Prelims 2024 Aptitude Clock MCQ Questions and answers with easy and logical explanation, PDF. Topic wise Free online practice test
Continue Reading »