introduction to macro economics section 4 MCQ Questions & Answers Detailed Explanation

Answer: (d)

Per capita income or average income or income per person is the mean income within an economic aggregate, such as a country or city.

It is calculated by taking a measure of all sources of income in the aggregate (such as GDP or Gross National Income) and dividing it by the total population.

Answer: (c)

Insider trading is the trading of a public company’s stock or other securities by individuals with access to non-public information about the company. It is related to share markets.

Insider trading is an unfair practice, wherein the other stockholders are at a great disadvantage due to the lack of important insider nonpublic information.

Answer: (c)

Some of the factors which affect the industrial location are as follows:

1. availability of raw materials,
2. availability of labour,
3. availability of capital,
4. availability of power,
5. availability of market and
6. infrastructure.

A good supply of labour is one of the traditional factors that are indispensable for industry.

Besides, the availability of power/electricity is also a deciding factor.

Answer: (a)

Investment multiplier is simply the multiplier effect of an injection of investment into an economy.

The multiplier effect refers to the idea that an initial spending rise can lead to an even greater increase in national income.

Answer: (c)

Consumption and income are directly or positively related.

An increase in income is associated with an increase in income; a decrease in consumption accompanies a decrease in income.

Answer: (d)

Average Revenue refers to revenue received per unit of output sold. It is the same as the Price of the commodity. Average revenue can be obtained by dividing the total revenue by the number of units sold.

Thus, Average Revenue (AR) = $\text"Total Revenue (TR)"/\text"Quantity sold (Q)"$

When we take the case of a single commodity,

TR = P × Q

So, AR= ${P × Q}/Q$ = P,

where P = Price of the commodity