Download Methodology of Social Sciences with Special Reference to Economics

Methodology of Social Sciences with Special Reference to Economics
(For Private Registration to BA Economics Programme)
1. Economics is concerned with:
a) The collection of revenue for the state.
b) The science of statecraft.
c) The science of wealth.
d) All of the above.
2. Adam Smith wrote a book called:
a) An enquiry into the nature and cause of the wealth of nations
b) Nations without Wealth
c) Reasons for creating Wealth
d) Wealthy Nations and Poor People
3. Wealth concept of Economics was bitterly criticized because
a) It assumed wealth as an end of human activities.
b) If it is accepted in life, there will be no place for love, affection, sympathy and patriotism.
c) Absence of these values will make our real life a hell.
d) All of the above.
4. Who suggested that Economics is the science of human welfare?
a) Thomas, Carlyle,
b) John Ruskin,
c) Charles Dickens
d) Alfred Marshal
5. Who propounded that Economics is the science, which studies human behaviours as a
relationship between ends and scarce means which have alternative uses?
a) Thomas, Carlyle,
b) John Ruskin,
c) Lionel Robbins
d) Alfred Marshal
6. Who propounded the Scarcity Concept in Economics?
a) Thomas, Carlyle,
b) Lionel Robbins
c) Charles Dickens
d) Alfred Marshal
7. Every individual and economy has _____________ wants and scarce means to satisfy these
wants.
a) Limited
b) Unlimited
c) Few
d) Strong
8. Inability to satisfy unlimited wants with limited resources creates the problems of:
a) Choice making i.e., fixing priority
b) Deficit budget
c) Surplus budget
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d) None of the above
9. Economics is significant for the consumers as it tells them: _________
a) How to make the best possible use of the funds available with them among different heads.
b) How to buy from the market
c) How to overcome the budgetary constraints
d) None of the above
10. The fundamental economic problem faced by all societies is:
a) unemployment
b) inequality
c) poverty
d) scarcity
11. Capitalism" refers to:
a) the use of markets
b) government ownership of capital goods
c) private ownership of capital goods
d) private ownership of homes & cars
12. There are three fundamental questions every society must answer. Which of the following is/are
one of these questions?
a) What goods and services are to be produced?
b) How are the goods and services to be produced?
c) Who will get the goods and services that are produced?
d) All of the above
13. The law of demand states that:
a) as the quantity demanded rises, the price rises
b) as the price rises, the quantity demanded rises
c) as the price rises, the quantity demanded falls
d) as supply rises, the demand rises
14. Economics is ______________.
a) the study of the markets for stocks and bonds
b) the study of choice under conditions of scarcity
c) exclusively the study of business firms
d) fundamentally the same as sociology
e) applicable only when scarcity is not a problem
15. People and organizations have to make choices about how to allocate time and money because of:
___________
a) government rules and regulations
b) corporate control of our lives
c) scarcity of time and money
d) religious values
e) unlimited resources
16. Under capitalism, individuals are forced to make choices due to _____________.
a) scarce time, but not scarce spending power
b) scarce spending power, but not scarce time
c) neither scarce time nor scarce spending power
d) both scarce time and scarce spending power
e) a low material standard of living
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17. Due to a scarcity of resources,
a. every society must undertake central planning
b. the government must decide how to allocate available resources
c. some members of each society must live in poverty
d. every society must choose among competing uses of available resources
e. resource availability exceeds the possible uses for available resources
18. In every economic system, scarcity imposes limitations on ( a )
a. households, business firms, governments, and the nation as a whole
b. households and business firms, but not the governments
c. local and state governments, but not the federal government
d. households and governments, but not business firms
e. business firms, governments, and the nation as a whole
19. The three groups of decision makers in the economy are
a. households, business firms, and banks
b. households, business firms, and governments
c. business firms, governments, and banks
d. business firms, banks, and foreign traders
e. households, governments, and banks
20. Macroeconomics focuses on the behavior of economic agents such as the consumer, a business
firm, or a specific market.
a. True
b. False
c. May be
d. No Comments
21. Microeconomics deals with which of the following?
a. the total output of an economy
b. the measurement of a nation's inflation rate
c. how producers and consumers interact in individual markets
d. how tax policies influence economic growth
e. whether wage growth will outpace inflation in the coming year
22. The opportunity cost of a particular activity
a. is the same for everyone pursuing this activity
b. may include both monetary costs and forgone income
c. always decreases as more of that activity is pursued
d. usually is known with certainty
e. measures the direct benefits of that activity
23. Opportunity costs arise in production because
a. resources are unlimited
b. resources must be shifted away from producing one good in order to produce another
c. wants are limited in society
d. monetary costs of inputs usually outweigh non-monetary costs
e. the monetary costs of only a few resources are zero
24.
a)
b)
c)
For economists, the word "utility" means:
versatility and flexibility
rationality
pleasure and satisfaction
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d) purposefulness
25.
a)
b)
c)
d)
In economics, the pleasure, happiness, or satisfaction received from a product is called:
marginal cost
rational outcome
status fulfillment
utility
26.
a)
b)
c)
d)
When economists say that people act rationally in their self interest, they mean that individuals:
look for and pursue opportunities to increase their utility
generally disregard the interests of others
are mainly creatures of habit
are unpredictable
27.
a)
b)
c)
d)
According to economists, economic self-interest:
is a reality that underlies economic behavior
is more characteristic of men than of women
has the same meaning as selfishness
is usually self-defeating.
28. Economics may best be defined as the:
a) interaction between macro and micro considerations
b) social science concerned with the efficient use of scarce resources to achieve maximum
satisfaction of economic wants
c) empirical testing of value judgments through the use of logic
d) use of policy to refute facts and hypotheses
29.
a)
b)
c)
d)
The study of economics is primarily concerned with:
keeping private businesses from losing money
demonstrating that capitalistic economies are superior to socialistic economies
choices that are made in seeking to use scarce resources efficiently
determining the most equitable distribution of society's output
30.
a)
b)
c)
d)
The economic perspective refers to:
macroeconomic phenomena, but not microeconomic phenomena
microeconomic phenomena, but not macroeconomic phenomena
the making of rational decisions in a context of marginal costs and marginal benefits
unlimited resources in a context of limited economic wants
31.
a)
b)
c)
d)
The economic perspective entails:
irrational behavior by individuals and institutions
a comparison of marginal benefits and marginal costs in decision making
short-term but not long-term thinking
rejection of the scientific method
32.
a)
b)
c)
d)
Rational behavior suggests that:
everyone will make identical choices
resource availability exceeds economic wants
individuals will make different choices because their preferences and circumstances differ
an individual's economic goals cannot involve tradeoffs
33. Economics involves marginal analysis because:
a) most decisions involve changes from the present situation
b) marginal benefits always exceed marginal costs
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c) marginal costs always exceed marginal benefits
d) much economic behavior is irrational
34.
a)
b)
c)
d)
The assertion that "There is no free lunch" means that:
there are always tradeoffs between economic goals
all production involves the use of scarce resources and thus the sacrifice of alternative goods
marginal analysis is not used in economic reasoning
choices need not be made if behavior is rational
35. Consumers spend their incomes to get the maximum benefit or satisfaction from the goods and
services they purchase. This is a reflection of:
a) resource scarcity and the necessity of choice
b) rational behavior
c) marginal costs that exceed marginal benefits
d) the tradeoff problem that exists between competing goals
36.
a)
b)
c)
d)
“An Enquiry into the Nature and Causes of Wealth of Nations” is the book of economist—
Adam Smith
Marshall
Robbins
None of above
37.
a)
b)
c)
a)
“Economics is the Science of Wealth” who gave this definition?
J. K. Mehta
Marshall
Adam Smith
Robbins
38.
a)
b)
c)
d)
“Economics is what economists do.” It has been supported by—
Richard Jones
Comte
Gunnar Myrdal
All of the above
39. “Human Welfare is the subject of Economics.” This statement is associated with the name of
which of the economists?
a) Marshall
b) Pigou
c) Penson
d) All of the above
40.
a)
b)
c)
d)
Who has given scarcity definition of economics?
Adam Smith
Marshall
Robbins
Robertson
41.
a)
b)
c)
d)
“Economics is a science” the basis of this statement is—
Relation between cause and effect
Use of deductive method and inductive method for the formations of laws
Experiments
All of the above
42. Characteristics of economic laws are—
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a)
b)
c)
d)
Mere statements of economic tendencies
Less certain
Hypothetical
All of the above
43.
a)
b)
c)
d)
Which theory is generally included under micro economics?
Price Theory
Income Theory
Employment Theory
None of the above
44.
a)
b)
c)
d)
Whose opinions have revolutionized the scope of macro economics?
Adam Smith
J.B. Say
J.M. Keynes
All of the above
45.
a)
b)
c)
d)
Which of the following is an economic activity?
Teaching of a teacher in the school
To teach son at home
To serve her child by mother
To play football by a student
46.
a)
b)
c)
d)
Passive factor of production is—
Only land
Only capital
Both land and capital
Neither land nor capital
47.
a)
b)
c)
d)
Under law of demand—
Price of commodity is an independent variable
Quantity demanded is a dependent variable
Reciprocal relationship is found between price and quantity demanded
All of the above
48.
a)
b)
c)
d)
For inferior commodities, income effect is—
Zero
Negative
Infinite
Positive
49.
a)
b)
c)
d)
When total utility becomes maximum, then marginal utility will be—
Minimum
Average
Zero
Negative
50.
a)
b)
c)
d)
Utility means—
Power to satisfy a want
Usefulness
Willingness of a person
Harmfulness
51. According to Marshall, the basis of consumer surplus is—
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a)
e)
f)
g)
Law of diminishing marginal utility
Law of equi-marginal utility
Law of proportions
All of the above
52.
a)
b)
c)
d)
Economics is the study of:
increasing the level of productive resources so there is maximum output in society
increasing the level of productive resources so there is a minimum level of income
how people, institutions, and society make choices under conditions of scarcity
the efficient use of scarce resources paid for at the minimum level of cost to consumers and
businesses
53.
a)
b)
c)
d)
The primary focus of the study of economics is with:
expanding the production of goods and services
equalizing the distribution of consumer income and wealth
making the most efficient use of scarce productive resources
reallocating resources from consumption to production in the economy
54.
a)
b)
c)
d)
The general concern of economics is with the study of the:
degree of competition in stock and bond markets in the economy
efficient use of limited productive resources to satisfy economic wants
issue of equality in the distribution of income and wealth among households
budget deficits in the domestic economy and trade deficits in the international economy
55.
a)
b)
c)
d)
Which of the following is not a central focus of the "economic perspective"?
Scarcity and choice
The scientific method
Purposeful behavior
Marginal analysis
56.
a)
b)
c)
d)
Marginal utility is equal to average utility at that time when average utility is—
Increasing
Maximum
Falling
Minimum
57.
a)
b)
c)
d)
At point of satiety, marginal utility is—
Zero
Positive
Maximum
Negative
58.
a)
b)
c)
d)
Which of the following is the second law of Gossen ?
Law of equi-marginal utility
Law of equi-product
Theory of indifference curve
Law of diminishing marginal utility
59.
a)
b)
c)
d)
Total utility of a commodity is measured by which price of that commodity?
Value in use
Value in exchange
Both of above
None of above
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60. The term scarcity in economics refers to the fact that:
A. economic wants are limited and resources are abused.
B. even in the richest country some people go hungry.
C. no country can produce enough products to satisfy everybody's economic wants.
D. it is impossible to produce too much of any particular good or service in a market economy.
61. The basic economic problem is essentially one of deciding how to make the best use of:
A. limited resources to satisfy limited economic wants.
B. limited resources to satisfy unlimited economic wants.
C. unlimited resources to satisfy unlimited economic wants
D. unlimited resources to satisfy limited economic wants
62. The key economic concept that serves as the basis for the study of economics is:
A. inflation.
B. unemployment
C. money
D. scarcity
63. As a student of economics, when you speak of scarcity, you are referring to the ability of society
to:
A. employ all of its resources.
B. consume all that is produced.
C. satisfy economic wants given limited resources.
D. continually make technological breakthroughs and increase production.
64. As a consequence of the condition of scarcity:
A. there is never enough of anything.
B. production has to be centrally planned.
C. things which are plentiful have relatively high prices.
D. individuals and communities have to make choices from among alternatives.
65. What is the economic meaning of the expression that "there is no such thing as a free lunch"?
A. It refers to "free-riders," who do not pay for the cost of a product, but who receive the benefit
from it.
B. It means that economic freedom is limited by the amount of income available to the consumer.
C. It means that there is an opportunity cost when resources are used to provide "free" products.
D. It indicates that products only have value because people are willing to pay for them.
66. One major feature of the economic perspective is:
A. that scarcity is more important than choice.
B. that costs are more important than benefits.
C. the assumption of purposeful behavior by individuals.
D. the recognition of economic resources in the economy.
67. The satisfaction or pleasure one gets from consuming a good or service is:
A. price.
B. utility.
C. consumption.
D. preferences.
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68. The utility of a specific product:
A. is determined by consumer income.
B. is determined by the price of the product.
C. varies from person to person using the product.
D. is constant from person to person using the product.
69. Which expression is another way of saying "marginal cost"?
A. total cost
B. additional cost
C. rational behavior
D. scarcity
70. Henry wants to buy a book. The economic perspective suggests that Henry will buy the book if:
A. the book will give him utility.
B. his income is high.
C. the marginal cost of the book is greater than its marginal benefit.
D. the marginal benefit of the book is greater than its marginal cost.
71. From an economic perspective, when a consumer decides to buy more life insurance, the
consumer has most likely concluded that the:
A. marginal costs of more insurance coverage have decreased.
B. marginal benefits of more insurance coverage have increased.
C. marginal benefits of more insurance coverage are greater than the marginal costs.
D. opportunity costs of more insurance coverage are greater than the payment for more insurance
coverage.
72. From an economic perspective, when a student decides to attend another year of college, the
student has concluded that the marginal:
A. costs of attending college has decreased that year.
B. benefits of attending college has increased that year.
C. benefits of attending college are greater than the marginal costs.
D. costs of attending college will be subsidized by someone else such as parents or the
government.
73. When an economist says that there is "too much of a good thing," the economist is suggesting
that:
A. scarcity is not a problem.
B. wants are not unlimited.
C. the marginal cost of the thing is less than the marginal benefit.
D. the marginal benefit of the thing is less than the marginal cost.
74. The concept of "purposeful behavior" suggests that:
A. macroeconomics is more important then microeconomics.
B. microeconomics is more important than macroeconomics.
C. people make different choices because their circumstances and information differ.
D. there is a logical fallacy of composition that affects microeconomic thinking but not
macroeconomic thinking.
75. Are the goods that businesses offer for "free" to consumers also free to society?
A. Yes, because the individual consumer does not have to pay for them.
B. Yes, because the marginal benefit is greater than the marginal cost.
C. No, because scarce resources were used to produce the free goods.
D. No, because society does not assign a value to free goods.
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76. When producers maximize their profits from the production of a good or service, they are:
A. testing a hypothesis.
B. exhibiting purposeful behavior.
C. assuming that all other things are equal.
D. making a tradeoff between economic efficiency and economic freedom.
77. How is the economic perspective reflected in lines for fast food?
A. Customers select the shortest line because they have perfect information.
B. Customers select the shortest line because they believe it will reduce their time cost of
obtaining food.
C. Lines will typically be of unequal length because of the inefficiencies in counter service.
D. The set of food choices is often too complex for most customers and thus creates long lines.
78. From an economic perspective, when consumers leave a fast-food restaurant because the lines to
be served are too long, they have concluded that the:
A. marginal cost of waiting is less than the marginal benefit of being served.
B. marginal cost of waiting is greater than the marginal benefit of being served.
C. management is exhibiting irrational behavior by not maximizing profits.
D. management is making an assumption that other things are equal.
79. The process of developing hypotheses, testing them against facts, and using the results to
construct theories is called:
A. opportunity cost calculation.
B. the scientific method.
C. marginal analysis.
D. microeconomics.
80. The statement that "the unemployment rate will increase as the economy moves into a recession"
is an example of:
A. a normative statement.
B. a microeconomic statement.
C. marginal analysis.
D. a generalization.
81. An economic model is:
A. a value judgment.
B. a fact.
C. built using theory.
D. built on policies.
82. Economic models do not reflect the full complexity of reality and instead are based on:
A. tradeoffs.
B. purposeful simplifications.
C. value judgments.
D. the fallacy of composition.
83. The role of an assumption in an economic theory is to:
A. add realism.
B. prove the theory.
C. cover special cases.
D. simplify the theory.
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84. The purpose of the ceteris paribus assumption used in economic analysis is to:
A. make sure that all relevant factors are considered.
B. avoid making normative statements.
C. aggregate economic data.
D. restrict the analysis to the effect of a single economic factor.
85. A basic assumption used in most economic theories is that:
A. what is true for a part of the whole must also be true for the whole.
B. as price decreases, quantity demanded will increase.
C. whatever goes up must come down.
D. all other things remain the same.
86. Economists have difficulty applying the scientific method because:
A. economic conditions are constant.
B. controlled laboratory experiments are impossible or often infeasible.
C. people are involved, and their behavior is entirely predictable.
D. the scientific method does not apply to economics.
87. Which question is an illustration of a macroeconomic question?
A. What is the amount of profit for Intel and other makers of microchips?
B. How does a cut in the business tax rate increase business investment in the economy?
C. What will be the level of stock market and bond market prices at the end of the year?
D. How does the supply of fruits and vegetables change when there is bad weather affecting
crops?
88. Which is an illustration of a microeconomic question?
A. What is the current national rate of unemployment?
B. Is the economy experiencing a decline in the rate of inflation?
C. Will a new type of television set increase the number of buyers?
D. Is the production of goods and services in the economy greater this year than last year?
89. Which question is an example of a microeconomic question?
A. What should the Federal government do to reduce the trade deficit with Japan?
B. Will the merger of two airlines likely lead to higher airline ticket prices?
C. What factors are contributing to the rise of unemployment in the economy?
D. Will the inflation rate remain relatively stable this year?
90. Microeconomics focuses on:
A. the workings of the whole economy or large sectors of it.
B. the individual units that make up the whole of the economy.
C. issues such as unemployment and inflation.
D. total output and the general level of prices.
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91. Macroeconomics focuses on:
A. the individual units that make up the whole of the economy.
B. studies of how individual markets and industries are organized.
C. total output and the general level of prices in the economy.
D. how a business determines how much of a product to produce
92. The study of how one business firm sets its prices would fall under the study of:
A. macroeconomics.
B. microeconomics.
C. income distribution.
D. economic growth.
93. The branch of economics that focuses primarily on aggregates is:
A. macroeconomics.
B. microeconomics.
C. scientific economics.
D. consumer economics.
94. An "aggregate:"
A. treats a collection of specific units as one unit.
B. treats a single unit as if it were a set or collection of specific units
C. is the primary unit of analysis in microeconomics.
D. is too large to analyze using standard macroeconomic theories.
95. Which would be considered a macroeconomic study? A study of the effect of:
A. a decrease in the price of automobiles on automobile sales.
B. government spending to increase employment.
C. a new tax on the profits of a business.
D. interest rates on a firm's investment.
96. Which question is an illustration of a microeconomic question?
A. Is the quantity of wine purchased in one year dependent upon the price of wine?
B. Does government spending influence the total level of employment in the economy?
C. Is the purchasing power of the dollar higher or lower today than it was in 2000?
D. Is capitalism superior to socialism?
97. Which question is an illustration of a macroeconomic question?
A. Is a business unresponsive to the demands of consumers?
B. Is a consumer boycott an effective means of reducing product prices?
C. Is the level of employment in the economy sensitive to the quantity of consumer spending?
D. Are oil companies engaging in a rip-off of the consumer by charging exorbitantly high prices
for gasoline?
98. The macroeconomist would most likely study:
A. the effects of changing beer prices on the market for pretzels.
B. the effects of an increased income tax on a typical household's purchase of goods.
C. the effects of a reduction in income tax rates on the nation's total output.
D. how consumers in Gary, Indiana, respond to a reduction in gasoline prices.
99. Macroeconomics is the study of economics from the standpoint of:
A. individual economic units.
B. a typical firm.
C. a typical household.
D. the overall economy.
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100. The alternative combinations of two goods which a consumer can purchase with given money
income are:
A. a production possibilities curve.
B. a demand curve.
C. consumer equilibrium.
D. a budget line.
101. The price ratio of the two products is the:
A. marginal rate of substitution.
B. slope of the budget line.
C. point of tangency for equilibrium.
D. demand for the two products.
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102. Economics is the study of the efficient use of scarce resources to achieve maximum satisfaction
of economic wants.
A. TRUE
B. False
C. May be Correct
D. No Comments
103. Marginal analysis is the comparison of additional benefits with the additional costs.
A.TRUE
B. FALSE
C. May be Correct
D. No Comments
104. From the "economic perspective" people make purposeful decisions based on hypotheses.
A.FALSE
B. TRUE
C. May be Correct
D. No Comments
105. Economics is primarily concerned with marginal changes from the status quo.
A. TRUE
B. FALSE
C. May be Correct
D. No Comments
106. The scientific method involves developing hypotheses from factual observations, and then
testing the hypotheses.
A. TRUE
B. FALSE
C. May be Correct
D. No Comments
107. By using the same ceteris paribus assumptions, economic principles are just as certain and
precise as those of the laboratory sciences.
A. FALSE
B. TRUE
C. May be Correct
D. No Comments
108. Macroeconomics is concerned with the whole economy or its major sectors.
A. TRUE
B. FALSE
C. May be Correct
D. No Comments
109. The economizing problem arises from the conflict between having relatively unlimited resources
and relatively limited wants.
A. FALSE
B. TRUE
C. May be Correct
D. No Comments
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110. The fundamental economic problem is that productive resources are scarce in relation to the
demand for them.
A. TRUE
B. FALSE
C. May be Correct
D. No Comments
111. The four factors of production are land, labor, capital, and government services.
A. FALSE
B. TRUE
C. May be Correct
D. No Comments
112. A point inside the production possibilities curve illustrates that resources are not being used as
efficiently as possible.
A, TRUE
B. FALSE
C. May be Correct
D. No Comments
113. The concave, or bowed-out, shape of the production possibilities curve illustrates the law of
increasing opportunity costs.
A. TRUE
B. FALSE
C. May be Correct
D. No Comments
114. If the marginal benefits are greater than the marginal cost of an activity, then society is over
allocating resources to this activity.
A. FALSE
B. TRUE
C. May be Correct
D. No Comments
115. The marginal cost curve for a product slopes upward as more units are produced because of the
law of increasing costs.
A. TRUE
B. FALSE
C. May be Correct
D. No Comments
116. If the marginal benefits of the output from resources devoted to the production of a product are
greater than the marginal costs, then there has been an over-allocation of resources to the
production of that product.
A. FALSE
B. TRUE
C. May be Correct
D. No Comments
117. Economic growth is shown by a shift of the production possibilities curve outward and to the
right.
A. TRUE
B. FALSE
C. May be Correct
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D. No Comments
118. If a nation is incurring a trade deficit (it is buying more from abroad - importing, then it is
selling abroad - exporting), then it is most likely producing beyond the frontier of its production
possibilities curve.
A, FALSE
B. TRUE
C. May be Correct
D. No Comments
119. The implied production possibilities curve between work time and grades suggests that more
hours spent working will mean more income, but also less study time and a lower grade
average.
A. TRUE
B. FALSE
C. May be Correct
D. No Comments
120. Many states in last years have introduced user charges in public hospitals because of that(A) The difference between the treatment cost in private and public hospitals has decreased
(B) The treatment cost of poor has increased
(C) Percentage of patients taking treatment in public hospitals has come down
(D) The treatment cost in public hospitals has decreased
Which of the above statements is not correct ?
121. The rate of growth of Indian economy during last three years has been 8 per cent. At this rate
the G.N.P. will be double in(A) 12 years (B) 9years
(C) 15 years (D) 10 years
122. For equitable development it is necessary that(A) Proportionate benefit to all classes
(B) Main benefit goes to rich persons
(C) Main benefit goes to poor persons
(D) Main benefit goes to middle classes
123. Bank rate in India is determined by(A) Government
(B) Commercial Banks
(C) Reserve Bank of India
(D) Cooperative Banks
124. The economy will be in equilibrium if(A) I = S
(B) Y > C
(C) I > C
(D) I< C
125. The factors affecting the elasticity of demand of a commodity are(A) Availability of substitutes
(B) Possibility of postponing consumption
(C) Share of expenditure in the total budget
(D) Whether the person is educated or uneducated
126. Which of the above factors is wrong ?
The biggest producer of Soybean is
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(A) Madhya Pradesh
(B) Rajasthan
(C) U. P.
(D) Maharashtra
127. The biggest producer of gram in India is——
(A) Maharashtra
(B) U. P.
(C) M. P.
(D) None of these states
128. The function of money is/ are(A) Medium of exchange
(B) Measure of value
(C) Store of value
(D) All of these
129. The utility from a bundle of goods will be maximum when the marginal utility of each
commodity is equal to the price multiplied by the marginal utility of money/’ This was stated
by~—
(A) Marshall
(B) Adam Smith
(C) Hicks
(D) None of these
130. When relative change in demand is equal to change in price, the price elasticity of demand will
be(A) Unit .
(B) Less than one
(C) Greater than one
(D) Infinity
131. Suppose money income in the year 2000 was 5 lakh, which increased 10 lakh in the year
2008. But during the same period, there was a price increase of 20 per cent. Then increase in real
income was(A) 8-33 lakh
(B) 363 lakh
(C) 51akh ,
(D) None of these
132. To obtain maximum satisfaction, the following equation must be satisfy f1/ f2 = P1/P2
where fl and f2 indicate marginal utility and P1 and P2 indicates their prices.
(A) Above equation is correct
(B) Above equation is wrong
(C) Above equation indicates minimum, not maximum satisfaction
(D) None of the above
133. Inferior goods means—
(A) When demand remains constant, though price increased
(B) When demand decreases with increase in price
(C) When demand decreases with decrease in price
(D) Demand remains the same with decrease in price
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134. There are some misconceptions about monopoly. Which one of the following?
(A) Monopoly firm tries to earn maximum profit
(B) Monopoly firm always earns profit
(C) Marginal income of mono-poly firm is equal to marginal cost
(D) None of the above
135. Which of the following statements is true?
(A) Product differentiation is not necessary in monopolistic competition
(B) Monopolistic competition normally requires product differentiation
(C) There is no reaction from others if one under monopolistic competition decreases price
(D) With perfect elastic demand, price decrease under monopolistic competition decreases total
revenue
136. Equilibrium means—
(A) No tendency to change with time
(B) Changes in all variables with time
(C) Other combinations of variable represent better situation
(D) Change in one variable, others remaining constant
137. Gross national product is equal to(A) Gross national product —Import
(B) GDP + Net Factor Income from abroad
(C) Gross domestic product +Imports
(D) Gross national product +Exports
138. Entrepreneurial activity is performed(A) By rich persons
(B) Who works under conditions of certainty
(C) Who works only on the basis of past experiences
(D) Who works under conditions of uncertainty
139. Which of the following is included in Macro-economics
(A) Equilibrium of the firm
(B) Price determination of a commodity
(C) Trade cycle theory
(D) Price determination of LPG in India
140. Trade off means—
(A) Simultaneous increase in two variables
(B) Increase in one variable, keeping the other constant
(C) Decrease in other variable with increase of one
(D) None of the above
141. In a country in which the demand for land is greater than the Supply(A) There will be no price for marginal land
(B) Marginal land will also have price
(C) Only fertile land will have price
(D) There will be no price even for fertile land
142. A firm will suffer loss—
(A) If the price is less than average fixed cost + average variable cost
(B) If the price is less than variable cost
(C) lf the price is less than average fixed cost
(D) lf the price is more than average fixed cost + average variable cost
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143. lf the amount of 100 crore is invested in an economy and if marginal propensity to consume
is 0•8, then increase in national income will be—
(A) 80 crore
(B) 300 crore
(C) 500 crore
(D) None of these
144. The great depression of thirties gave birth to the theory of—
(A) Say’s law of market
(B) Full employment equilibrium
(C) That real wages determine the supply of labour
(D) Keynesian theory of Employment
145. If the total cost of production of 400 units is Rs. 8,000 and of 399 units is Rs. 7,990, then the
production is under—
(A) Law of increasing Returns to the Scale
(B) Law of Decreasing Returns to Scale
(C) Law of Constant Returns to Scale
(D) None of the above
146. Inflation in India is measured by?
(A) Change in wholesale price index
(B) Increase in currency in circulation
(C) Change in retail price index
(D) Credit created by the banks
147. Income from taxes is divided(A) State’s income from taxes is shared by Centre
(B) Income of some taxes of the Centre is shared by States
(C) States and the Centre have independent sources of income and no sharing
(D) None of the above
148. Central Bank in India is(A) Central Bank of India
(B) State Bank of India
(C) Bank of India
(D) Reserve Bank of India
149. Which of the following does not come under Macro-economics
(A) Employment theory
(B) Price determination of LPG in India
(C) Theory of depression
(D) Functions of Central Bank in India
150. Macro-economics suffers from(A) All theories are influenced by generalization
(B) The analysis employs the technique of partial analysis
(C) Deals with large quantities
(D) Relates to determination of total employment and total income
151. The movement from non-Pareto to Pareto equilibrium is desirable because(A) It increases the production of first commodity without adversely affecting the production of
second
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(B) It increases the production of second commodity more than it decreases the production of
first
(C) It increases the production of first commodity more than if decreases the production of
second one
(D) None of the above
152. Inflation means(A) When the prices of necessities increase
(B) When the general price increases for a long period
(C) When there is a seasonal fluctuation in prices
(D) When the prices of luxuries increase
153. Speculative Demand for money and Interest rate are related—
(A) Inverse relationship
(B) Direct relationship
(C) No relationship in these
(D) None of these
154. When the demand for money increases for investment(A) Will decrease the multiplier effect
(B) Adversely affect the consumption
(C) Interest rate will remain unchanged
(D) The increase in interest rate will depend upon the slope of investment curve
155. Disinflation means—
(A) When increase in prices in the long run
(B) When the prices increase due to export
(C) When the increase in prices is more than average
(D) When increased prices decrease
156. Transaction demand curve for money—
(A) It is parallel to X—axis
(B) It moves upward with income
(C) It moves downward
(D) None of these
157. If any firm uses only two factors of production, namely labour (L) and capital (K), which of the
following equations represent minimum cost of production
(A) MPPL/ PL = MPPK / PK
(B) MPPL x PL = MPPK x PK
(C) MRPL = MRPK
(D) MPPL : MPPK
158. Devaluation of money means—
(A) Decrease in purchasing power of money
(B) Increase in purchasing power of money
(C) Decrease in external value of money
(D) None of the above
159. Money supply could be increased when(A) Central Bank purchases government securities
(B) Central Bank sells government securities
(C) Cash-reserve ratio of banks is increased
(D) Commercial Banks increase the amount deposited with Central Bank
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160. Minimum wage should be determined(A) Less than prevailing wage rates
(B) Higher than equilibrium rate in die market
(C) Minimum Physical and Social needs may be fulfilled
(D) None of the above
161. Pigou’s concept of equilibrium firm is a(A) Completely new concept, having nothing to do with Marshallian representative firm
(B) Revised version of Marshallian representative firm
(C) Marshall’s representative firm is a revised version of Pigou’s equilibrium firm
(D) None of the above
162. Under monopolistic competition, excess capacity means(A) Excess capacity under the condition of making loss
(B) Difference between profit maximizing production and minimum cost production
(C) Optimum and maximum profit giving production difference between the two
(D) None of the above
163. Law of Variable Proportions means(A) Simultaneous change in the proportion of inputs
(B) Keeping one input constant while changing others
(C) Reducing other inputs and increasing only one input
(D) None of the above
164. Under monopolistic competition in long run—
(A) Firm will always earn monopoly profit
(B) Firm might earn normal profit only
(C) Firm will always earn normal profit
(D) None of the above
165. Bankers’ Bank in India is(A) International Monetary Fund
(B) World Bank
(C) Industrial Development Bank of India
(D) Reserve Bank of India
166. The ratio of exchange between two goods in the indifference curve analysis is shown by——
(A) Price line
(B) Price-consumption curve
(C) Income consumption curve
(D) From indifference curve
167. The number of people living in poverty in India is
a) 30 crores
b) 26 crores
c) 35 crores
d) 20 crores
168. For the year 2000, the poverty line for a person in urban areas in India was fixed at
a) Rs. 454 per month
b) Rs. 500 per month
c) Rs. 328 per month
d) Rs. 1640 per month
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169. The country which has the largest single concentration of the poor people in the world is
a) China
b) Pakistan
c) India
d) Nepal
170. For the year 2000, the poverty line for a person in rural areas in India was fixed at
a) Rs 454 per month
b) Rs 500 per month
c) Rs 328 per month
d) Rs 1640 per month
171. There is a strong link between economic growth and
a) Poverty reduction
b) Increase in poverty
c) Economic stability
d) Food security
172. The accepted average calorie requirement per person in urban areas in India is
a) 2200 calories
b) 2000 calories
c) 2300 calories
d) 2100 calories
173. Which of the following is not an anti-poverty programme?
a) NREGA
b) NSSO
c) AAY
d) PMGY
174. In which of the following countries did poverty actually rise from 1981 to 2001?
a) Sub Saharan Africa
b) India
c) China
d) Russia
175. Periodical estimation of poverty line is conducted by _______________
a) NSSO
b) PDS
c) AAY
d) NREGA
176. The poorest states in India are :
i) Orissa
ii) Bihar
iii)Punjab
iv) Haryana
a. (i) and (ii)
b. (iii) and (iv)
c, (ii) and (,iii)
d. All (i), (ii), (iii) and (iv)
177. The number of people living in poverty in India is
a) 30 crores
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b) 26 crores
c) 35 crores
d) 20 crores
178. The distinguishing feature of a federal government is
a) National Government gives some powers to the provincial government.
b) Power is distributed among the legislature, executive and judiciary.
c) elected officials exercise supreme power in the government.
d) Governmental power is divided between different levels of government.
179. List the countries which do not follow federalism
a) Spain, Sweden, Britain
b) India, Belgium, Canada and Australia
c) The USA, Spain, Holland
d) China, Sri Lanka, France, United Kingdom, Japan, Italy and North Korea
180. What was the key change made in the constitution of Belgium ?
(i) Increase the power of the central government.
(ii) Transfer of powers to the regional government.
(iii) Reduce the power of the central government
(iv) Reduce the power of the regional government.
Which option is appropriate :
a. (i), (iii) and (iv)
b. (i), (ii) and (iii)
c. (i) and (iii)
d. (ii) and (iii)
181. The System of Panchayati Raj involves
a) The village, block and district levels.
b) The village, and state levels
c) The village district and state levels
d) The village, state and Union levels.
182. The distinguishing feature of a federal system is
National Government gives some powers to the provincial government.
Power is distributed among the legislature, executive and judiciary.
Elected officials exercise Supreme Power in the government
Governmental power is divided between different levels of government.
183. A few subjects in various lists of the Indian Constitution are given here. Group them under the
Union, State and Concurrent lists as provided in the table below :
(i) Defence (ii) Police
(iii) Agriculture (iv) Education
(v) Banking (vi) Forests
(vii) Communications (viii) Trade
(ix) Marriages
Which option is correct:
a) Union list (i), (viii) and (ix) State list (ii), (iii) and (iv) Concurrent list (v), (vi) and (vii)
b) Union list (i), (v) and (vii) State list (ii), (iii) and (viii) Concurrent list (iv), (ix) and (vi)
c) Union list (v), (vi) and (vii) State list (iii), (vii) and (ix) Concurrent list (i), (ii) and (iv)
d) Union list (iii), (vi) and (vii) State list (v), (viii) and (ix) Concurrent list (iv), (ii) and (i)
184. Consider the statement: "coming together federation" involves.
(i) Central government to become more powerful.
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(ii) Independent states coming together on their own to form bigger unit.
(iii) Constituent units have unequal powers.
(iv) Constituent units have equal powers.
a) (i), (ii) and (iv)
b) (i), (iii) only
c) (ii) and (iv) only
d) (i), (iii) and (iv)
185. Select the two bases on which new states of India have been created
a) Religion and geography
b) Language and regional
c) Culture and religion
d) Geography and language
186. Whose laws prevail if there is conflict between the state government and central government on the
subject of concurrent list:
a) The laws made by the state government
b) The laws made by both State and Union Government
c) The laws made by the Union Government
d) The laws would be cancelled.
187. Select the countries that follow coming together federal system
a) The USA, China, Australia
b) India, Spain, Belgium, Canada
c) The USA, Switzerland, Australia
d) China and India only
188. The distinguishing feature of a federal government is
a) National Government gives some powers to the provincial government.
b) Power is distributed among the legislature, executive and judiciary.
c) Elected officials exercise supreme power in the government.
d) Governmental power is divided between different levels of government.
189.Which of the following are True :
a) Laws that seek to ban something are not very successful in politics.
b) Challenge of deepening of democracy is faced by communist countries only,
c) Political reforms are not uniform for every democracy.
d) The right to information is an example of political reform .
190.Democracy does not stand for :
a) Democratic Right
b) Elections
c) Violence
d) Accommodation of diversity
191. Foundational challenge includes
a) Bringing down the existing non-democratic regimes
b) Strengthening of the institutions and practices of democracy
c) Keeping military away from controlling and practices of democracy.
d) Establishing a sovereign and functional state.
192. Which of the following are True :
a) Foundational challenge is the challenge of most of the non-democratic countries.
b) Challenge of Deepening of democracy is faced by only communist countries.
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c) Challenge of expansion is faced by established democracies.
d) The challenge means facing difficulties without any solution.
193. Which of the following represents a challenge to democracy ?
a) Women not allowed to take part in public activities in Saudi Arabia
b) Renewed violence in Sri Lanka following the break down of talks between the government and
LTTE.
c) Money and muscle power during election.
d) All of the above.
194. Which of the following are True :
a) Laws that seek to ban something are not very successful in politics.
b) Challenge of deepening of democracy is faced by communist countries only,
c) Political reforms are not uniform for every democracy.
d) The right to information is an example of political reform
195. Removing barriers or restrictions set by the government is known as
a) Privatization
b) Liberalization
c) Globalization
d) Socialization
196. To achieve the goal of fair globalisation, major role can be played by (i) People (ii) Government
(iii) MNCs (iv) None of the above
a. (i) and (iii)
b. (ii) and (iv)
c. (i)and(ii)
d. (iii)and(iv)
197. Benefit to the local company of joint production with MNCs is (i) Money from MNCs for additional
investments (ii) Moral & Social support (iii) Latest technology for production (iv) All of them
(i) and (ii)
(ii) and (iii)
(iii) and (iv)
(i) and (iii)
198. Examples of industries where production is carried out by a large number of small producers around
the world
a) Garments
b) Footwear
c) Sport items
d) All of them
199. Company that owns or controls production in more than one nation
a) Foreign companies
b) Government companies
c) Multinational companies
d) Private companies
200. Rapid integration or interconnection between countries is known as
a) Privatization
b) Globalization
c) Liberalization
d) Socialization
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