top of page

Economics (MCQ) part 3

1.The national income of a country for a given period is equal to the:

(a)Total value of goods and services produced by the nationals.

(b) Sum of total consumption and investment expenditure.

(c) Sum of personal income of all individuals.

(d) Money value of final goods and services produced.

2.The GNP gap is the gap between:

(a) GNP and NNP

(b) GNP and depreciation

(c) GNP and GDP

(d) Potential and actual GNP.

3.The causes of black money are :

(a) Public expenditure programme

(b) Inflation

(c) Political finance and standard of Public morality

(d) All of the above

4.The internal debt comprises :

(a) Market borrowing

(b) Treasury Bills

(c) Special securities issued to RBI

(d) All of the above

5. Circular flow of income in a two sector model implies :

(a) Payments from households to firm and back again

(b) Payments from firms to firms

(c) Payments from households to households

(d) Payments from households to firms

6. Double counting has the effect of:

(a) Underestimating national product

(b) Overestimating national product

(c) Misleading conclusions about national income.

(d) Distorting national product.

7. Interest on the national debt is included in :

(a) NNP

(b) GNP

(c) Personal Income

(d) National Income

8.Net domestic product at factor cost equals net domestic product at market prices :

(a) Plus subsidies minus indirect taxes

(b) Minus subsidies plus indirect taxes

(c) Minus subsidies

(d) Plus indirect taxes

9.Which plan has been extended up to both rural and urban areas?

(a) Prime Minister Employment Scheme

(b) Jawahar Rojgar Yojana

(c) Nehru Rojgar Yojana

(d) None of these

10.Which institution provides long-run finance to industries?

(a) UTI

(b) LIC

(c) GIC

(d) All of these

11.Which of the public sectors has completed 100 years of its establishment on December 21, 2011?

(a) Central Bank of India

(b) State Bank of India

(c) Punjab National Bank

(d) Bank of Baroda

12. National Income calculated at current prices has shown a tendency to rise at a faster rate than national income calculated at constant prices. This is because:

(a) India’s population has been rising fast.

(b) Planned expenditure has been increasing fast.

(c) Statistical manipulation is employed by the planners.

(d) General Price level has been rising fast.

13. The biggest commercial bank in India is the _____.

(a) Reserve Bank of India

(b) Industrial Development Bank of India

(c) Exim Bank of India

(d) State Bank of India

14.National Income of a nation is _______.

(a) Government’s annual revenue

(b) Sum total of factor incomes

(c) Surplus of Public Sector Undertakings

(d) Export minus import

15.The apex banking institution in India is the ______.

(a) State Bank of India

(b) Reserve Bank of India

(c) Bank of India

(d) United Western Bank of India.

16.Excise duties, which are the biggest source of revenue of the Union Government, are levied on :

(a) Sale of goods

(b) Production of goods

(c) Consumption of goods

(d) Resale of goods

17. N.N.P. is equal to :

(a) G.N.P. + depreciation

(b) G.N.P. + exports

(c) G.N.P. – depreciation

(d) G.N.P. – exports

18.Double counting means :

(a) Counting a product more than once

(b) Counting a product at different stages of output process

(c) Counting both as product and payment

(d) Counting both as ‘‘real flow’’ and as ‘‘money flow’’.

19.Which one of the following are the items for country planning?

(a) Raising standard of living

(b) Opportunities for work

(c) Facilities for education

(d) All of above

20.Which one of the following is not a method of estimating national income?

(a) Product method

(b) Export-Import

(c) Income method

(d) Expenditure method

21.Which one of the following banks has the largest number of branches?

(a) Reserve Bank of India

(b) State Bank of India

(c) Central Bank of India

(d) Union Bank of India

22.Which of the following measures cannot remove unemployment?

(a) Population Control

(b) Government Subsidies

(c) Increase in production

(d) Equitable distribution

23.Seasonal unemployment mainly refers to :

(a) Private Sector Industry

(b) Public Sector Industry

(c) Agriculture

(d) Banks

24.In which year, Reserve Bank of India was established?

(a) 1934

(b) 1935

(c) 1939

(d) 1945

25.Which is the largest nationalised bank in India?

(a) Punjab National Bank

(b) State Bank of India

(c) Bank of Baroda

(d) Bank of India

26.Currently, what is the base year for calculating the GDP in India?

(a) 2008—2009

(b) 2010—2011

(c) 2011—2012

(d) 2012—2013

27.The value of NNP at consumer point is :

(a) NNP at Factor Cost

(b) NNP at Market Price

(c) GNP at Market Price

(d) GNP at Factor Cost

28.Unemployment rate in India in 2015-16 is :

(a) 3.7%

(b) 4.1%

(c) 5.2%

(d) 2.9%

29.The govt. can collect funds from :

(a) Taxes

(b) Fees

(c) Prices of Public Goods

(d) All of the above

30.The national income estimation is responsibility of :

(a) NSSO

(b) CSO

(c) Finance Ministry

(d) National Income Committee

31.CRR is defined as :

(a) The amount of funds that the banks have to keep with the RBI

(b) The rate at which banks give loan to people

(c) The rate at which Central Bank gives loan to banks

(d) Minimum liquidity maintained by banks with themselves

32.What is the present bank rate in India?

(a) 6.25%

(b) 6.00%

(c) 5.75%

(d) 5.95%

33.The maximum amount of the total revenue earned by the government of India comes from:

(a) Income Tax

(b) Excise Duty

(c) Customs Duty

(d) Value Added Tax

34.In which type of unemployment do the marginal productivity of the worker is zero?

(a) Disguised unemployment

(b) Involuntary unemployment

(c) Seasonal unemployment

(d) Structural unemployment

35.The 14 major banks were nationalised by the government in :

(a) 1967

(b) 1969

(c) 1962

(d) 1963

36.National income is a measure of :

(a) The size of government revenue

(b) Payments made to factors of production

(c) Total increase in wages in a year

(d) Total production of goods in a period

37.Swarnjayanti Gram Swarozgar Yojna was launched in :

(a) 1999

(b) 2001

(c) 1995

(d) 2004

38.The net value of GDP after deducting depreciation from GDP is :

(a) Net National Product

(b) Net Domestic Product

(c) Gross National Product

(d) Disposable Income

39.To adjust from Net National Product to Gross National Product :

(a) Add depreciation

(b) Deduct Indirect Taxes

(c) Add subsidies

(d) Add Inflation

40.What type of Unemployment is found in the agriculture sector of India?

(a) Disguised Unemployment

(b) Voluntary Unemployment

(c) Frictional Unemployment

(d) None of the above

41.Employment Guarantee Scheme was started in the year.

(a) 1972

(b) 1969

(c) 1970

(d) 1990

42. Which of these is not a function of central bank?

(a) Accepting deposits of general public

(b) Custodian of Foreign Exchange reserves

(c) Banker's Bank

(d) Currency Authority

43.This bank operates in public interest without any profit motive :

(a) Canara Bank

(b) Reserve Bank of India

(c) State Bank of India

(d) Allahabad Bank

44.Which account deposits can be withdrawn without any notice?

(a) Saving

(b) Current

(c) Fixed

(d) Recurring

45.Which of the following is not the function of the commercial bank?

(a) Issue of paper notes

(b) Acceptance of deposits

(c) Advancing Loans

(d) Credit control

46.Which programme gave the slogan of Garibi Hatao?

(a) 4 th Five Year Plan

(b) 3 rd Five Year Plan

(c) 6 th Five Year Plan

(d) 5 th Five Year Plan

47. -------- is the money value of all final goods and services produced by a country during the period of one year

(a) National Income

(b) Depreciation

(c) Personal Income

(d) Disposable income

48.The difference between Gross Domestic Product and Net Domestic Product equals to –––––

(a) Transfer Payment

(b) Depreciation cost

(c) Indirect taxes

(d) Subsidies.

49.When some workers are temporarily out of work while changing job leads to ––––– unemployment.

(a) Cyclical unemployment

(b) Voluntary unemployment

(c) Frictional unemployment

(d) Seasonal unemployment.

50.Central Bank is not expected to perform the function of –––––––––

(a) Banker to the Government.

(b) Accepting deposits from commercial banks.

(c) Accepting deposits from general public.

(d) Acting as a clearing house.

51.Which one from the following is qualitative control measure –––––––––

(a) Bank rate Policy

(b) Open Market Operations

(c) Reserve ratio requirement.

(d) Margin requirements.

52.Which of the following is not an anti–inflationary measure –––––––––

(a) Rise in the bank rate.

(b) Rationing of credit.

(c) Raising the reserve ratio requirements.

(d) Purchase of securities in the open market.

53.Which one of the following is not a function of the commercial Banks?

(a) Provision of safe deposit facilities.

(b) Provision of a cheque system for settling debts.

(c) Lending to the Private and Public sectors.

(d) Acting as a lender of last resort.

54.The most liquid asset, next to cash, which the banks possess, is –––––––––

(a) Advances to customers

(b) Money at call

(c) Treasury bills

(d) Inland bills.

56.Scheduled Bank is that which is :

(a) Nationalised

(b) Not Nationalised

(c) Based a Foreign Country

(d) Included in the Second Schedule of RBI

57.Which of the following is not an importance of monetary policy?

(a) Open market operations

(b) Bank rate policy

(c) Reserve ratio requirement

(d) Government spending

58.RBI was Nationalised in :

(a) 1959

(b) 1947

(c) 1945

(d) 1949

59.While issuing bill of exchange, banks earn through :

(a) Interest

(b) Dividend

(c) Discount

(d) None of the above

60.Due to introduction of new machinery, some workers tend to be replaced by machines, their unemployment is termed as :

(a) Structural

(b) Technological

(c) Mechanical

(d) Seasonal

61.Which of the following is a commercial bank?

(a) UTI

(b) IFCI

(c) IBRD

(d) SEBI

62.Net National Product at factor cost is :

(a) Equal to national income

(b) More than national income

(c) Less than national income

(d) Always more than the gross national product

63.The gap between total government expenditure and revenue receipt is :

(a) Budget deficit

(b) Fiscal deficit

(c) Revenue deficit

(d) Primary deficit

64.During inflation public expenditure should be :

(a) Increased

(b) Reduced

(c) Diverted towards Social Welfare

(d) Remain constant

65.For the issue of currency, the RBI follows :

(a) Proportional Reserve System

(b) Fixed Fiduciary System

(c) Minimum Reserve System

(d) None of these

66.Paper purchased by a publisher is :

(a) Intermediate goods

(b) Final goods

(c) Consumer goods

(d) Service

67.Employment Guarantee Scheme was introduced in the State of :

(a) Karnataka

(b) Maharashtra

(c) Kerala

(d) Orissa

68.Which of the following method is used to measure national income at factor cost?

(a) Production method

(b) Income method

(c) Expenditure method

(d) Final expenditure method

69.Indirect taxes are not made as part of national income because :

(a) They influence the price

(b) They are not factor income

(c) They are income for the government

(d) None of the above

70.What is the Cash Reserve Ratio (CRR)?

(a) The fraction of the deposits that commercial banks lend to the customers

(b) The fraction of the deposits that RBI must keep with commercial banks

(c) The fraction of the deposits that commercial banks must keep with RBI

(d) None of the above

71.RBI was established in the year :

(a) 1935

(b) 1932

(c) 1940

(d) 1925

72.Banks create credit :

(a) Out of nothing

(b) On the basis of their security

(c) On the basis of their total assets

(d) On the basis of their cash deposits

73.The internal debt comprises :

(a) Market borrowings

(b) Treasury bills

(c) Special securities issued to RBI

(d) All the above

74.Nehru Rozgar Yojna was started to help :

(a) Urban unemployment

(b) Rural unemployment

(c) Agricultural unemployment

(d) Seasonal unemployment

75.Depreciation is the loss of value of :

(a) Capital Assets

(b) Stocks

(c) Final Goods

(d) Intermediate Goods

76.Which of the following is non-wage income?

(a) Profit

(b) Interest on capital

(c) Rent on land

(d) All of the above

77.For how many days NREGA provides employment?

(a) 70

(b) 80

(c) 90

(d) 100

78.The type of unemployment mostly found in India can be characterised as :

(a) Structural

(b) Frictional

(c) Cyclical

(d) Disguised

79.Sale of second hand goods will not be comprised in the GDP because :

(a) Second hand goods can be obtained at low price

(b) These goods are useless

(c) Both (a) and (b)

(d) It is not a product of current year

80.Which one of the following statements is correct?

(a) GNP includes depreciation

(b) Value added includes transfer payment

(c) Personal income includes undistributed profits

(d) Disposable income includes personal taxes

81.Suppose both real GDP and prices double. We can conclude that nominal output will be:

(a) More than doubled

(b) Doubled

(c) Rose by less than double

(d) Did not increase

82.National Income estimates in India are prepared by:

(a) Planning Commission

(b) RBI

(c) Finance Ministry

(d) C.S.O.

83.Which one of the following measures does not include final goods and services?

(a) GNP

(b) NNP

(c) Disposable Income

(d) National Income

84.The smallest national income accounting aggregate is usually :

(a) PI

(b) GNP

(c) DPI

(d) NI

85.National Income calculated at current prices has shown a tendency to rise at a faster rate than national income calculated at constant prices. This is because:

(a) India's population has been rising fast

(b) Planned expenditure has been rising fast

(c) Statistical manipulation are employed by the planners.

(d) General Price level has been rising fast.

86.Which of the following measures cannot remove unemployment?

(a) Population control

(b) Government subsidies

(c) Increase in production

(d) Equitable distribution

87.The GNP gap is the gap between :

(a) GNP and NNP

(b) GNP and depreciation

(c) GNP and GDP

(d) Potential and actual GNP

88.When some workers are, temporarily out of work while changing jobs leads to unemployment?

(a) Cyclical

(b) Voluntary

(c) Frictional

(d) Seasonal

89.Which of the following is the function of Central Bank?

(a) Acceptance of deposits

(b) Monopoly over note issue

(c) Advancing loan

(d) Credit creation.

90.According to the latest amendment in Banking Regulation Act, nationalised bank can release a share of total paid up capital up to a maximum ceiling of :

(a) 40%

(b) 49%

(c) 51%

(d) 100%

91.The best method of computing national income is:

(a) Product method

(b) Income method

(c) Expenditure method

(d) Combination of income and production method.

92.The most liquid asset, next to cash, which the banks possess, is:

(a) Advances to customers

(b) Money at call

(c) Treasury bill

(d) Inland bill.

93.The food for work programme was subsumed in :

(a) IRDP


(c) RLEP

(d) JRY

bottom of page