introduction to macro economics section 6 MCQ Questions & Answers Detailed Explanation
MOST IMPORTANT indian economy mcq - 6 EXERCISES
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The following question based on Introduction to Macro Economics topic of indian economy mcq
(a) Recession
(b) Inflation
(c) Stagnation
(d) Poverty
The correct answers to the above question in:
Answer: (c)
Deficient demand refers to the situation when aggregate demand for goods and services falls short of aggregate supply of output which is produced by fully employing the given resources of the economy. This deficient demand leads to the decrease in output, employ-ment and prices in the econo-my.
According to Malthus, deficiency of demand could lead to stagnation in which both capital and labor are redundant relative to the opportunities for employing them profitably.
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Read more introduction to macro economics Based Indian Economy Questions and Answers
Question : 1
The total value of goods and services produced in a country during a given period is
a) Per capita income
b) Net national income
c) National income
d) Disposable income
Answer »Answer: (c)
National income is the total value a country’s final output of all new goods and services produced in one year. Understanding how national income is created is the starting point for macroeconomics.
Question : 2
The main feature of a capitalist economy is
a) Economic planning
b) Private ownership
c) Public ownership
d) Administered prices
Answer »Answer: (b)
Capitalism is an economic system that is based on private ownership of the means of production and the production of goods or services for profit.
Other elements central to capitalism include capital accumulation and often competitive markets.
Question : 3
Net National Product of a country is
a) GNP minus net income from abroad
b) GNP minus depreciation allowances
c) GDP plus net income from abroad
d) GDP minus depreciation allowances
Answer »Answer: (b)
Net national product (NNP) is the total market value of all final goods and services produced by residents in a country or other polity during a given time period (gross national product or GNP) minus depreciation.
The net domestic product (NDP) is the equivalent application of NNP within macroeconomics, and NDP is equal to gross domestic product (GDP) minus Depreciation:
NDP = GDP - Depreciation.
Question : 4
A motion that seeks to reduce the amount of demand presented by government to Re. 1/is known as
a) Economy cut
b) Vote on account
c) Token cut
d) Disapproval of policy Cut
Answer »Answer: (d)
Disapproval of Policy Cut seeks to reduce the amount of the demand be reduced to Re.1/-’ representing disapproval of the policy underlying the demand.
A member giving notice of such a motion shall indicate in precise terms the particulars of the policy which he proposes to discuss. The discussion shall be confined to the specific point or points mentioned in the notice and it shall be open to members to advocate an alternative policy.
Question : 5
According to the classical system, saving is a function of
a) The real wage
b) The Price level
c) The interest rate
d) Income
Answer »Answer: (d)
Saving function is a mathematical relation between saving and income by the household sector.
This function captures the saving-income relation, the flip side of the consumption-income relation that forms one of the key building blocks for Keynesian economics.
Question : 6
Which one of the following is not a method of measurement of National Income ?
a) Investment Method
b) Expenditure Method
c) Income Method
d) Value Added Method
Answer »Answer: (a)
Primarily there are three methods of measuring national income. The methods are product method, income method and expenditure method.
Product method is given by Dr Alfred Marshall, income method by A.C. Pigou and expenditure method by Dr Irving Fisher.
The ‘Investment Method’ is used for trading properties where evidence of rates is slight, such as hotels, cinema, car parks and etc.
GET Introduction to Macro Economics PRACTICE TEST EXERCISES
introduction to macro economics section 1
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introduction to macro economics section 3
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introduction to macro economics section 5
introduction to macro economics section 6
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