introduction to macro economics section 3 MCQ Questions & Answers Detailed Explanation
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The following question based on Introduction to Macro Economics topic of indian economy mcq
(a) Marginal propensity to consumption
(b) Marginal efficiency to investment
(c) Marginal propensity to save
(d) Marginal efficiency of capital
The correct answers to the above question in:
Answer: (d)
According to Keynes’ ‘General Theory of Employment, Interest and Money,’ business cycles are caused by variations in the rate of investment which are caused by fluctuations in the marginal efficiency of capital.
Marginal efficiency of capital means the expected profits from new investments.
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Read more introduction to macro economics Based Indian Economy Questions and Answers
Question : 1
An economy in which there are no flows of labour, goods or money to and from other nations is a/an
a) closed economy
b) open economy
c) mixed economy
d) slow economy
Answer »Answer: (a)
An economy that does not interact with the economy of any other country is known as a closed economy.
A closed economy is self-sufficient, meaning no imports are brought in and no exports are sent out. It is the opposite of an open economy, in which a country conducts trade with outside regions.
Question : 2
National Income is also called as :
a) NNP at Factor Cost
b) NNP at Market Price
c) GNP at Market Price
d) GNP at Factor Cost
Answer »Answer: (d)
National Income is the total value of all goods and services produced in the economy during a particular period of time.
Question : 3
What is included in the Tetiary sector ?
a) Forestry
b) Mining
c) Manufacturing
d) Banking
Answer »Answer: (d)
The tertiary industry is the segment of the economy that provides services to its consumers.
It includes a wide range of activities that are service-based and give non-tangible value to customers such as the provision of trading, insurance, banking, etc.
The other sectors are the secondary sector (manufacturing), and the primary sector (agriculture and allied activities).
Question : 4
Preparation of butter, ghee by a household for their own use is a part of :
a) industrial production
b) consumption
c) household capital formation
d) own-account production
Answer »Answer: (b)
- The processing of agricultural products;
- The production of grain by threshing;
- The production of flour by milling;
- The curing of skins and the production of leather;
- The production and preservation of meat and fish products;
- The preservation of fruit by drying, bottling, etc.;
- The production of dairy products such as butter or cheese;
- The production of beer, wine or spirits; the production of baskets and mats; etc,
comes under processing of primary commodities for own consumption.
Question : 5
The basic problem studied in Macro - Economics is
a) flow of income
b) distribution of income
c) usage of income
d) production of income
Answer »Answer: (d)
Macroeconomics involves the sum total of economic activity, dealing with the issues such as the production of national income, growth, inflation, and unemployment.
It is all about is about maximizing national income and growth.
Question : 6
The method of calculating the national income by the product method is otherwise known as :
a) Expenditure method
b) Net output method
c) Value added method
d) Income method
Answer »Answer: (b)
Primarily there are three methods of measuring national income. Which method is to be employed depends on the availability of data and purpose. The methods are product method, income method and expenditure method.
According to the production method, the total value of final goods and services produced in a country during a year is calculated at market prices.
According to this method, only the final goods and services are included and the intermediary goods and services are not taken into account.
In this method, National Output = National Expenditure (Aggregate Demand) = National Income.
GET Introduction to Macro Economics PRACTICE TEST EXERCISES
introduction to macro economics section 1
introduction to macro economics section 2
introduction to macro economics section 3
introduction to macro economics section 4
introduction to macro economics section 5
introduction to macro economics section 6
Introduction to Macro Economics Shortcuts and Techniques with Examples
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