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) Liquidity preference
(b) Commercial Banks
(c) Central Government
(d) The rate of return on the capital invested
The correct answers to the above question in:
Answer: (b)
Bank Rate is determined by the Reserve Bank of India. The rate of interest is determined by the commercial banks in India.
As per RBI notification, banks are free to determine rates of interest subject to BPLR and spread guidelines. Banks may, however, offer loans at below BPLR to exporters or other creditworthy borrowers including public enterprises based on a transparent and objective policy approved by their Boards.
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Read more introduction to macro economics Based Indian Economy Questions and Answers
Question : 1
Consumption function expresses the relationship between consumption and
a) investment
b) price
c) income
d) savings
Answer »Answer: (c)
The consumption function is a mathematical formula laid out by famed economist John Maynard Keynes.
The formula was designed to show the relationship between real disposable income and consumer spending, the latter variable being what Keynes considered the most important determinant of short-term demand in an economy.
Question : 2
National income accounting is the study of the income and expenditure of the entire
a) economy
b) organisation
c) state
d) family
Answer »Answer: (a)
National Income Accounting is a set of principles and methods used to measure the income and production of a country.
There are basically two ways of measuring national economic activity:
- as the money value of the total production of goods and services during a given period (usually a year) or
- as the total of incomes derived from economic activity after allowance has been made for capital consumption.
Question : 3
Economic progress of a country is determined by
a) Increased numbers of Trade Unions
b) Fall in the general price level of a country
c) Increase in the price of produced capital goods during the year
d) Increase in per capita income of people of country
Answer »Answer: (d)
Economic progress of a country is determined by increase in per capita income of people of that country.
Question : 4
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 : 5
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 : 6
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.
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introduction to macro economics section 1
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introduction to macro economics section 4
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introduction to macro economics section 6
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