ECONOMICS- PAGE 7
1. Which of the following are the basic assumptions of cardinal utility analysis ?
I. Utility is a measurable and quantifiable entity.
II. Marginal utility of money changes with changes in real income.
III. Utilities derived from various goods are inter-dependent.
IV. The use of introspective method in judging the behaviour of marginal utility.
Codes :
(A) I and II are correct.
(B) I and III are correct.
(C) I and IV are correct.
(D) I, III and IV are correct.
Ans: C
2. Engel Curve denotes
(A) various amounts of a good which a consumer would be willing to purchase at various price levels.
(B) various amounts of a good which a consumer would be willing to purchase at various income levels.
(C) various amounts of a good purchased when the price of its substitutes tend to rise.
(D) the relationship between income effect and substitution effect.
Ans: B
3. A producer is said to be operating with excess capacity
(A) when he produces an output greater than that given by the minimum Average Total Cost
(B) when he produces an output greater than at given by the maximum Average Total Cost
(C) When he produces an output equal to that given by the minimum Average Total Cost
(D) When he produces an output smaller than that given by the Minimum Average Total Cost
Ans: D
4. Assertion (A) : Harvey Leibenstein asserted that marginal conditions required for economic efficiency are not usually satisfied in practice.
Reason (R) : People are not fully motivated towards maximization or minimization.
Codes :
(A) Both (A) and (R) are correct and (R) is the correct explanation of (A).
(B) (A) is correct, but (R) is not correct.
(C) Both (A) and (R) are correct, but (R) is incorrect explanation of (A).
(D) (R) is correct, but (A) is incorrect.
Ans: A
5. A graphical illustration used to explain efficiency conditions and demonstrates how the allocations of some goods and resources can be
improved through exchange is called
(A) production possibility curves
(B) social indifference curves
(C) Edgeworth box diagram
(D) Phillips curve
Ans: C
6. Match the following :
List – I List - II
a. A double Kaldor-Hicks Test 1. A. Bergson
b. Compensation Principle 2. K.J. Arrow
c. Social Welfare function 3. T. Scitovsky
d. Impossibility theorem 4. KaldorHicks
Codes :
a b c d
(A) 4 1 3 2
(B) 3 4 1 2
(C) 3 4 2 1
(D) 4 3 2 1
Ans: B
7. The oligopoly model in which the businessman assumes that his competitors output are fixed and simultaneously decide how much to
produce is
(A) Cournot oligopoly model
(B) Stackelberg oligopoly model
(C) Chamberlin’s oligopoly model
(D) Bertrand oligopoly model
Ans: A
8. According to Game Theory, if increased advertising, raises costs more than revenues and the profits of both firms decline, we have a
(A) Positive-sum game
(B) Non zero-sum game
(C) Zero-sum game
(D) Negative-sum game
Ans: D
9. Arrows impossibility theorem implies
(A) Any social decision rule should not violates the requirements of rational choice.
(B) Any social decision rule must violate atleast one of the requirements of rational choice.
(C) Any social decision rule must violate all the requirements of rational choice.
(D) It is impossible to violate social decision rules.
Ans: B
10. ‘Bandwagon effect’ is found in
(A) Relative Income hypothesis
(B) Permanent Income hypothesis
(C) Life cycle Hypothesis
(D) Absolute Income hypothesis
Ans: A
11. What has been the projected investment ratio for the infrastructure development for the Eleventh Five Year Plan of India ?
(A) 5.43 percent
(B) 6.53 percent
(C) 7.60 percent
(D) 9.34 percent
Ans: C
12. Complete the statements given in List – I with there given in List – II :
List – I List – II
a. Instantaneous adjustment of income with investment spending occurs in 1. MPC is smaller
b. Consumption lags income by one period in 2. increase in investment expenditure is once-forall
c. Value of investment multiplier is zero when 3. state multiplier
d. Major portion of multiplier is realized in fewer periods when 4. dynamic multiplier
Codes :
a b c d
(A) 3 4 1 2
(B) 3 4 2 1
(C) 4 3 1 2
(D) 2 3 1 4
Ans: B
13. Assertion (A) : The individual speculative demand for money is a discontinuous one.
Reason (R) : Because the aggregate speculative demand for money function is smooth downward sloping with liquidity trap at extremely low interest rates.
Codes :
(A) Both (A) and (R) are correct and (R) is the correct explanation of (A).
(B) Both (A) and (R) are correct but (R) is not the correct explanation of (A).
(C) (A) is correct, but (R) is incorrect.
(D) (A) is incorrect, but (R) is correct.
Ans: B
14. Transaction Cost is also called
(A) Shoe Leather Cost
(B) Menu Cost
(C) Opportunity Cost of holding cash
(D) All of the above
Ans: A
15. Given the consumption function, C = 0.8Y, and the investment function I = 102 – 0.2i, then the IS-curve is
(A) Y = 500 – 10i
(B) Y = 450 – i
(C) Y = 510 – i
(D) Y = 505 – 2i
Ans: C
16. Match the premise given in List – I with that in List – II :
List – I List – II
a. Price expectations are static 1. Okun’s law
b. Price expectations are adaptive 2. Phillips Curve
c. People do not make systematic errors 3. Natural Rate of unemployment hypothesis
d. Deviations of output from its natural rate is inversely related to the deviation of unemployment rate from its natural level 4. Rational
expectations hypothesis
Codes :
a b c d
(A) 2 3 4 1
(B) 4 3 2 1
(C) 1 3 4 2
(D) 4 2 1 3
Ans: A
17. Which of the following can be linked with those providing method for estimating black money in India ?
I. Kaldor’s approach
II. NIPFP method
III. O.P. Chopra’s method
IV. Arjun Sengupta
Codes :
(A) I, II & III
(B) II, III & IV
(C) I, III & IV
(D) I & II
Ans: A
18. When the aggregate supply schedule is positively sloped, continuous increases in the nominal money supply, ceteris parilus, result in
(A) No change in the price level and proportional increases in real output.
(B) No change in real output and proportional increases in the price level.
(C) An increase in the price level and real output.
(D) An increase in the price level and a decrease in real output.
Ans: C
19. What is the share of single lane/intermediate lane in the total length of National Highways ?
(A) 12 percent (B) 15 percent
(C) 22 percent (D) 29 percent
Ans: C
20. During which year, gross domestic savings of the public sector turned negative in the Indian economy ?
I. 1990 – 91
II. 1995 – 96
III. 1999 – 2000
IV. 2002 – 2003
Codes :
(A) I and II (B) II and III
(C) III and IV (D) I and IV
Ans: C
21. Concept of disembodied technical change is associated with
I. Abramovitz II. Kaldor
III. Kendrick IV. Solow
(A) I and II (B) III and IV
(C) I, III and IV (D) II, III and IV
Ans: C
22. Joan Robinson’s growth model deals with
I. Desired growth rate
II. Possible growth rate
III. Natural growth rate
IV. Warranted growth rate
Codes :
(A) I and III (B) II and IV
(C) I and II (D) III and IV
Ans: C
23. Assertion (A) : To Marx, it is surplus labour that lead to capital accumulation.
Reason (R) : The difference between actual labour and subsistence labour that a labourer puts in for which he receives nothing is surplus labour.
Codes :
(A) (A) is correct, but (R) is not the correct reason for (A).
(B) (A) is correct and (R) is incorrect.
(C) Both (A) and (R) are correct.
(D) Both (A) and (R) are incorrect.
Ans: C
24. Arrange the “Structural Development Processes” in a sequential order :
I. Resource Allocation Processes
II. Accumulation Process
III. Distributional Processes
IV. Demographic Processes
Codes :
(A) I, IV, II, III (B) II, I, IV, III
(C) III, II, I, IV (D) IV, III, I, II
Ans: B
25. Match the items in List – I with List – II :
List – I List – II
a. MPL is zero in overpopulated economies 1. Gunnar Myrdal
b. Two gap model 2. J.E. Mead
c. Critical growth rate 3. Arthur Lewis
d. Backwash effects 4. Hollis Chenery & others
Codes :
a b c d
(A) 1 3 4 2
(B) 3 4 2 1
(C) 2 1 3 4
(D) 4 2 1 3
Ans: B
26. Match the items in List – I with List – II :
List – I List – II
a. Learning by doing 1. Kaldor
b. Biased Technical Progress 2. Karl Sax
c. Co-efficient of sensitivity of income distribution 3. Kenneth J. Arrow
d. Theory of Demographic Transition : Four stages of Population growth 4. Joan
Robinson
Codes :
a b c d
(A) 3 4 1 2
(B) 1 3 2 4
(C) 2 1 4 3
(D) 4 2 3 1
Ans: A
27. Assertion (A) : Solow model is a major improvement over Harrod-Domar Model.
Reason (R) : Solow built a model of long run growth without the assumption of fixed proportion in production.
Codes :
(A) (A) is correct, but (R) is not the correct reason of (A).
(B) (A) is not correct, but (R) is correct.
(C) Both (A) and (R) are correct.
(D) Both (A) and (R) are not correct.
Ans: C
28. The concentrations effect explained in Peacock-Wiseman hypothesis implies
(A) public expenditure does not increase in smooth and continuous manner
(B) public expenditure increases the necessity of increased revenue
(C) the Central Government’s economic activity to grow faster than that of subnational Governments
(D) absolute level of public expenditure increases
Ans: C
29. A tax imposed upon monopoly profits
(A) can be shifted forward
(B) can be shifted backward
(C) can be shifted both forward and backward
(D) cannot be shifted
Ans: D
30. The plan expenditure on Revenue Account of the Union Government includes
I. Economic Services
II. Social and community services
III. Grants-in-aid to States and Union Territories
IV. Loans and Advances to finance public enterprises
Codes :
(A) I and II are correct.
(B) I, II and III are correct.
(C) I, II and IV are correct.
(D) I, II, III and IV are correct.
Ans: B
31. Debt obligations of Government of India (Government liabilities)
I. State Provident Funds
II. Small Savings
III. Reserve Funds and Deposits
IV. Consolidated Fund of India
Codes :
(A) II and III are correct.
(B) I, II and III are correct.
(C) II, III and IV are correct.
(D) I, III and IV are correct.
Ans: B
32. Identify the chronology of the following Committees on tax reforms in India :
I. Committee on Taxation of Agricultural Income and Wealth
II. Kaldor Proposal for Tax Reform in India
III. Taskforces on Direct and Indirect Taxes
IV. Direct Taxes Administration Enquiry Committee
Codes :
(A) II, I, IV, III (B) II, IV, I, III
(C) II, III, I, IV (D) I, III, IV, II
Ans: B
33. Which of the following are the role of Finance Commissions in India ?
I. To make recommendations on the distribution of tax proceeds between Centre and States.
II. To make Recommendations on levying, removing or restructuring of taxes.
III. To recommend Grants-in-aid under Article 275 of the Constitution
IV. To recommend plan and other grants under Article 282 of the Constitution
Codes :
(A) I and II are correct.
(B) I and III are correct.
(C) I, III and IV are correct.
(D) All are correct.
Ans: B
34. Under a managed floating exchange rate system, the nation’s monetary authorities intervene in foreign exchange markets to
(A) smooth out short-run and longrun fluctuations in exchange rates
(B) keep exchange rates fixed among a group of nations
(C) smooth out short-run fluctuations in exchange rates
(D) keep exchange rates flexible
Ans: C
35. Euro currency market is a part of a larger global market known as Eurodollar market
(A) Above statement is correct.
(B) Above statement is not correct.
(C) Above statement is partially correct.
(D) Above statement is partially incorrect.
Ans: B
36. Match the following :
List – I List – II
a. WTO 1. Provide finance to correct disequilibrium in balance of payments.
b. IMF 2. Generally forbids the use of quantitative restrictions in trade.
c. SAARC 3. Sanction of soft loans
d. IDA 4. Promotes trade among South Asian Countries
Codes :
a b c d
(A) 1 2 3 4
(B) 2 3 4 1
(C) 2 1 4 3
(D) 3 2 4 1
Ans: C
37. A sudden shift from import tariffs to free trade may induce short term unemployment in
(A) import competing industries
(B) industries that are only exporters
(C) industries that sell domestically as well as export
(D) industries that neither import nor export
Ans: A
38. The immediate cause for the collapse of the Bretton woods system was
(A) the expectation that the U.S.A. would soon be forced to devalue the dollar
(B) the massive flight of liquid capital from the U.S.A.
(C) the attempt by three small European Central Banks to convert part of their dollar holding into gold at the Federal Reserve Bank.
(D) All of the above
Ans: D
39. A feasible effect of international trade is that
(A) a monopoly in the home market becomes an oligopoly in the world market
(B) an oligopoly in the home market becomes a monopoly in the world market
(C) a purely competitive firm in the home market becomes an oligopolist
(D) a purely competitive firm in the home market becomes a monopolist
Ans: A
40. The European Union has achieved all of the following, except
(A) adopted a common fiscal policy for member nations
(B) established a common system of agricultural price supports
(C) disbanded all tariffs between its member countries
(D) levied common tariffs on products imported from nonmembers
Ans: A
41. A Foreign Trade Zone (FTZ) is
(A) a regional area within which trade with foreign nations is allowed
(B) a free trade agreement among several nations
(C) designed to promote exports by deferring import duties on intermediate inputs and waving such duties if the final product is re-exported rather than sold domestically
(D) designed to limit exports of manufactured goods by placing import taxes on goods made within the zone
Ans: C
42. Arrange the following sub-sectors of the services sector of the Indian economy in ascending order of their contributions to the GDP in recent years :
I. Trade, hotels and restaurants
II. Transport, storage and communication
III. Financing, insurance, real estate and business services
IV. Community, social and personal services
Codes :
(A) I, II, III, IV
(B) II, IV, III, I
(C) II, I, III, IV
(D) I, III, IV, II
Ans: B
43. Which of the following will act as the ‘lender of intermediate resort’ ?
(A) RBI
(B) NABARD
(C) SBI
(D) None of the above
Ans: C
44. According to Gurley and shaw, the various substitutes of currency and commercial bank demand deposits should be assigned different weights according to
(A) their degree of replacement
(B) their degree of substitutability
(C) their share in the money market
(D) their share in money supply
Ans: B
45. Assertion (A) : Primary financial markets deals in new financial claims.
Reason (R) : It mobilises savings and supplies new capital to the business units.
Codes :
(A) Both (A) and (R) are correct and (R) is the correct explanation of (A).
(B) Both (A) and (R) are correct and (R) is not a correct explanation of (A).
(C) (A) is true, but (R) is false.
(D) (A) is false, but (R) is true.
Ans: A
46. Margin requirement specified under which instruments of monetary policy ?
(A) Variable Reserve Requirement
(B) Statutory Liquidity Requirement
(C) Selective Credit Controls
(D) Open Market Operations
Ans: C
47. As per Micro, Small and Medium Enterprise Development Act, 2006, Medium Enterprises are defined as those with investments :
(A) < 25 lakhs
(B) 25 lakhs to 5 crores
(C) 5 crores to 10 crores
(D) > 10 crores
Ans: C
48. Theory of Industrial Location is associated with the names of
I. Losch
II. Weber
III. Christaller
IV. Lerner
Codes :
(A) I & II
(B) I only
(C) I, II and III
(D) I, II, III and IV
Ans: C
49. The Committees related to industrial licensing policy are
I. Arjun Sengupta Committee
II. D.G. Karve Committee
III. Subimal Dutt Committee
IV. R.K. Hazari Committee
Codes :
(A) I and II
(B) II and III
(C) III and IV
(D) I, II and III
Ans: C
50. Which Industrial Policy Resolution gave the public sector a strategic role in the Indian Economy ?
(A) 1948 (B) 1956
(C) 1977 (D) 1980
Ans: B
I. Utility is a measurable and quantifiable entity.
II. Marginal utility of money changes with changes in real income.
III. Utilities derived from various goods are inter-dependent.
IV. The use of introspective method in judging the behaviour of marginal utility.
Codes :
(A) I and II are correct.
(B) I and III are correct.
(C) I and IV are correct.
(D) I, III and IV are correct.
Ans: C
2. Engel Curve denotes
(A) various amounts of a good which a consumer would be willing to purchase at various price levels.
(B) various amounts of a good which a consumer would be willing to purchase at various income levels.
(C) various amounts of a good purchased when the price of its substitutes tend to rise.
(D) the relationship between income effect and substitution effect.
Ans: B
3. A producer is said to be operating with excess capacity
(A) when he produces an output greater than that given by the minimum Average Total Cost
(B) when he produces an output greater than at given by the maximum Average Total Cost
(C) When he produces an output equal to that given by the minimum Average Total Cost
(D) When he produces an output smaller than that given by the Minimum Average Total Cost
Ans: D
4. Assertion (A) : Harvey Leibenstein asserted that marginal conditions required for economic efficiency are not usually satisfied in practice.
Reason (R) : People are not fully motivated towards maximization or minimization.
Codes :
(A) Both (A) and (R) are correct and (R) is the correct explanation of (A).
(B) (A) is correct, but (R) is not correct.
(C) Both (A) and (R) are correct, but (R) is incorrect explanation of (A).
(D) (R) is correct, but (A) is incorrect.
Ans: A
5. A graphical illustration used to explain efficiency conditions and demonstrates how the allocations of some goods and resources can be
improved through exchange is called
(A) production possibility curves
(B) social indifference curves
(C) Edgeworth box diagram
(D) Phillips curve
Ans: C
6. Match the following :
List – I List - II
a. A double Kaldor-Hicks Test 1. A. Bergson
b. Compensation Principle 2. K.J. Arrow
c. Social Welfare function 3. T. Scitovsky
d. Impossibility theorem 4. KaldorHicks
Codes :
a b c d
(A) 4 1 3 2
(B) 3 4 1 2
(C) 3 4 2 1
(D) 4 3 2 1
Ans: B
7. The oligopoly model in which the businessman assumes that his competitors output are fixed and simultaneously decide how much to
produce is
(A) Cournot oligopoly model
(B) Stackelberg oligopoly model
(C) Chamberlin’s oligopoly model
(D) Bertrand oligopoly model
Ans: A
8. According to Game Theory, if increased advertising, raises costs more than revenues and the profits of both firms decline, we have a
(A) Positive-sum game
(B) Non zero-sum game
(C) Zero-sum game
(D) Negative-sum game
Ans: D
9. Arrows impossibility theorem implies
(A) Any social decision rule should not violates the requirements of rational choice.
(B) Any social decision rule must violate atleast one of the requirements of rational choice.
(C) Any social decision rule must violate all the requirements of rational choice.
(D) It is impossible to violate social decision rules.
Ans: B
10. ‘Bandwagon effect’ is found in
(A) Relative Income hypothesis
(B) Permanent Income hypothesis
(C) Life cycle Hypothesis
(D) Absolute Income hypothesis
Ans: A
11. What has been the projected investment ratio for the infrastructure development for the Eleventh Five Year Plan of India ?
(A) 5.43 percent
(B) 6.53 percent
(C) 7.60 percent
(D) 9.34 percent
Ans: C
12. Complete the statements given in List – I with there given in List – II :
List – I List – II
a. Instantaneous adjustment of income with investment spending occurs in 1. MPC is smaller
b. Consumption lags income by one period in 2. increase in investment expenditure is once-forall
c. Value of investment multiplier is zero when 3. state multiplier
d. Major portion of multiplier is realized in fewer periods when 4. dynamic multiplier
Codes :
a b c d
(A) 3 4 1 2
(B) 3 4 2 1
(C) 4 3 1 2
(D) 2 3 1 4
Ans: B
13. Assertion (A) : The individual speculative demand for money is a discontinuous one.
Reason (R) : Because the aggregate speculative demand for money function is smooth downward sloping with liquidity trap at extremely low interest rates.
Codes :
(A) Both (A) and (R) are correct and (R) is the correct explanation of (A).
(B) Both (A) and (R) are correct but (R) is not the correct explanation of (A).
(C) (A) is correct, but (R) is incorrect.
(D) (A) is incorrect, but (R) is correct.
Ans: B
14. Transaction Cost is also called
(A) Shoe Leather Cost
(B) Menu Cost
(C) Opportunity Cost of holding cash
(D) All of the above
Ans: A
15. Given the consumption function, C = 0.8Y, and the investment function I = 102 – 0.2i, then the IS-curve is
(A) Y = 500 – 10i
(B) Y = 450 – i
(C) Y = 510 – i
(D) Y = 505 – 2i
Ans: C
16. Match the premise given in List – I with that in List – II :
List – I List – II
a. Price expectations are static 1. Okun’s law
b. Price expectations are adaptive 2. Phillips Curve
c. People do not make systematic errors 3. Natural Rate of unemployment hypothesis
d. Deviations of output from its natural rate is inversely related to the deviation of unemployment rate from its natural level 4. Rational
expectations hypothesis
Codes :
a b c d
(A) 2 3 4 1
(B) 4 3 2 1
(C) 1 3 4 2
(D) 4 2 1 3
Ans: A
17. Which of the following can be linked with those providing method for estimating black money in India ?
I. Kaldor’s approach
II. NIPFP method
III. O.P. Chopra’s method
IV. Arjun Sengupta
Codes :
(A) I, II & III
(B) II, III & IV
(C) I, III & IV
(D) I & II
Ans: A
18. When the aggregate supply schedule is positively sloped, continuous increases in the nominal money supply, ceteris parilus, result in
(A) No change in the price level and proportional increases in real output.
(B) No change in real output and proportional increases in the price level.
(C) An increase in the price level and real output.
(D) An increase in the price level and a decrease in real output.
Ans: C
19. What is the share of single lane/intermediate lane in the total length of National Highways ?
(A) 12 percent (B) 15 percent
(C) 22 percent (D) 29 percent
Ans: C
20. During which year, gross domestic savings of the public sector turned negative in the Indian economy ?
I. 1990 – 91
II. 1995 – 96
III. 1999 – 2000
IV. 2002 – 2003
Codes :
(A) I and II (B) II and III
(C) III and IV (D) I and IV
Ans: C
21. Concept of disembodied technical change is associated with
I. Abramovitz II. Kaldor
III. Kendrick IV. Solow
(A) I and II (B) III and IV
(C) I, III and IV (D) II, III and IV
Ans: C
22. Joan Robinson’s growth model deals with
I. Desired growth rate
II. Possible growth rate
III. Natural growth rate
IV. Warranted growth rate
Codes :
(A) I and III (B) II and IV
(C) I and II (D) III and IV
Ans: C
23. Assertion (A) : To Marx, it is surplus labour that lead to capital accumulation.
Reason (R) : The difference between actual labour and subsistence labour that a labourer puts in for which he receives nothing is surplus labour.
Codes :
(A) (A) is correct, but (R) is not the correct reason for (A).
(B) (A) is correct and (R) is incorrect.
(C) Both (A) and (R) are correct.
(D) Both (A) and (R) are incorrect.
Ans: C
24. Arrange the “Structural Development Processes” in a sequential order :
I. Resource Allocation Processes
II. Accumulation Process
III. Distributional Processes
IV. Demographic Processes
Codes :
(A) I, IV, II, III (B) II, I, IV, III
(C) III, II, I, IV (D) IV, III, I, II
Ans: B
25. Match the items in List – I with List – II :
List – I List – II
a. MPL is zero in overpopulated economies 1. Gunnar Myrdal
b. Two gap model 2. J.E. Mead
c. Critical growth rate 3. Arthur Lewis
d. Backwash effects 4. Hollis Chenery & others
Codes :
a b c d
(A) 1 3 4 2
(B) 3 4 2 1
(C) 2 1 3 4
(D) 4 2 1 3
Ans: B
26. Match the items in List – I with List – II :
List – I List – II
a. Learning by doing 1. Kaldor
b. Biased Technical Progress 2. Karl Sax
c. Co-efficient of sensitivity of income distribution 3. Kenneth J. Arrow
d. Theory of Demographic Transition : Four stages of Population growth 4. Joan
Robinson
Codes :
a b c d
(A) 3 4 1 2
(B) 1 3 2 4
(C) 2 1 4 3
(D) 4 2 3 1
Ans: A
27. Assertion (A) : Solow model is a major improvement over Harrod-Domar Model.
Reason (R) : Solow built a model of long run growth without the assumption of fixed proportion in production.
Codes :
(A) (A) is correct, but (R) is not the correct reason of (A).
(B) (A) is not correct, but (R) is correct.
(C) Both (A) and (R) are correct.
(D) Both (A) and (R) are not correct.
Ans: C
28. The concentrations effect explained in Peacock-Wiseman hypothesis implies
(A) public expenditure does not increase in smooth and continuous manner
(B) public expenditure increases the necessity of increased revenue
(C) the Central Government’s economic activity to grow faster than that of subnational Governments
(D) absolute level of public expenditure increases
Ans: C
29. A tax imposed upon monopoly profits
(A) can be shifted forward
(B) can be shifted backward
(C) can be shifted both forward and backward
(D) cannot be shifted
Ans: D
30. The plan expenditure on Revenue Account of the Union Government includes
I. Economic Services
II. Social and community services
III. Grants-in-aid to States and Union Territories
IV. Loans and Advances to finance public enterprises
Codes :
(A) I and II are correct.
(B) I, II and III are correct.
(C) I, II and IV are correct.
(D) I, II, III and IV are correct.
Ans: B
31. Debt obligations of Government of India (Government liabilities)
I. State Provident Funds
II. Small Savings
III. Reserve Funds and Deposits
IV. Consolidated Fund of India
Codes :
(A) II and III are correct.
(B) I, II and III are correct.
(C) II, III and IV are correct.
(D) I, III and IV are correct.
Ans: B
32. Identify the chronology of the following Committees on tax reforms in India :
I. Committee on Taxation of Agricultural Income and Wealth
II. Kaldor Proposal for Tax Reform in India
III. Taskforces on Direct and Indirect Taxes
IV. Direct Taxes Administration Enquiry Committee
Codes :
(A) II, I, IV, III (B) II, IV, I, III
(C) II, III, I, IV (D) I, III, IV, II
Ans: B
33. Which of the following are the role of Finance Commissions in India ?
I. To make recommendations on the distribution of tax proceeds between Centre and States.
II. To make Recommendations on levying, removing or restructuring of taxes.
III. To recommend Grants-in-aid under Article 275 of the Constitution
IV. To recommend plan and other grants under Article 282 of the Constitution
Codes :
(A) I and II are correct.
(B) I and III are correct.
(C) I, III and IV are correct.
(D) All are correct.
Ans: B
34. Under a managed floating exchange rate system, the nation’s monetary authorities intervene in foreign exchange markets to
(A) smooth out short-run and longrun fluctuations in exchange rates
(B) keep exchange rates fixed among a group of nations
(C) smooth out short-run fluctuations in exchange rates
(D) keep exchange rates flexible
Ans: C
35. Euro currency market is a part of a larger global market known as Eurodollar market
(A) Above statement is correct.
(B) Above statement is not correct.
(C) Above statement is partially correct.
(D) Above statement is partially incorrect.
Ans: B
36. Match the following :
List – I List – II
a. WTO 1. Provide finance to correct disequilibrium in balance of payments.
b. IMF 2. Generally forbids the use of quantitative restrictions in trade.
c. SAARC 3. Sanction of soft loans
d. IDA 4. Promotes trade among South Asian Countries
Codes :
a b c d
(A) 1 2 3 4
(B) 2 3 4 1
(C) 2 1 4 3
(D) 3 2 4 1
Ans: C
37. A sudden shift from import tariffs to free trade may induce short term unemployment in
(A) import competing industries
(B) industries that are only exporters
(C) industries that sell domestically as well as export
(D) industries that neither import nor export
Ans: A
38. The immediate cause for the collapse of the Bretton woods system was
(A) the expectation that the U.S.A. would soon be forced to devalue the dollar
(B) the massive flight of liquid capital from the U.S.A.
(C) the attempt by three small European Central Banks to convert part of their dollar holding into gold at the Federal Reserve Bank.
(D) All of the above
Ans: D
39. A feasible effect of international trade is that
(A) a monopoly in the home market becomes an oligopoly in the world market
(B) an oligopoly in the home market becomes a monopoly in the world market
(C) a purely competitive firm in the home market becomes an oligopolist
(D) a purely competitive firm in the home market becomes a monopolist
Ans: A
40. The European Union has achieved all of the following, except
(A) adopted a common fiscal policy for member nations
(B) established a common system of agricultural price supports
(C) disbanded all tariffs between its member countries
(D) levied common tariffs on products imported from nonmembers
Ans: A
41. A Foreign Trade Zone (FTZ) is
(A) a regional area within which trade with foreign nations is allowed
(B) a free trade agreement among several nations
(C) designed to promote exports by deferring import duties on intermediate inputs and waving such duties if the final product is re-exported rather than sold domestically
(D) designed to limit exports of manufactured goods by placing import taxes on goods made within the zone
Ans: C
42. Arrange the following sub-sectors of the services sector of the Indian economy in ascending order of their contributions to the GDP in recent years :
I. Trade, hotels and restaurants
II. Transport, storage and communication
III. Financing, insurance, real estate and business services
IV. Community, social and personal services
Codes :
(A) I, II, III, IV
(B) II, IV, III, I
(C) II, I, III, IV
(D) I, III, IV, II
Ans: B
43. Which of the following will act as the ‘lender of intermediate resort’ ?
(A) RBI
(B) NABARD
(C) SBI
(D) None of the above
Ans: C
44. According to Gurley and shaw, the various substitutes of currency and commercial bank demand deposits should be assigned different weights according to
(A) their degree of replacement
(B) their degree of substitutability
(C) their share in the money market
(D) their share in money supply
Ans: B
45. Assertion (A) : Primary financial markets deals in new financial claims.
Reason (R) : It mobilises savings and supplies new capital to the business units.
Codes :
(A) Both (A) and (R) are correct and (R) is the correct explanation of (A).
(B) Both (A) and (R) are correct and (R) is not a correct explanation of (A).
(C) (A) is true, but (R) is false.
(D) (A) is false, but (R) is true.
Ans: A
46. Margin requirement specified under which instruments of monetary policy ?
(A) Variable Reserve Requirement
(B) Statutory Liquidity Requirement
(C) Selective Credit Controls
(D) Open Market Operations
Ans: C
47. As per Micro, Small and Medium Enterprise Development Act, 2006, Medium Enterprises are defined as those with investments :
(A) < 25 lakhs
(B) 25 lakhs to 5 crores
(C) 5 crores to 10 crores
(D) > 10 crores
Ans: C
48. Theory of Industrial Location is associated with the names of
I. Losch
II. Weber
III. Christaller
IV. Lerner
Codes :
(A) I & II
(B) I only
(C) I, II and III
(D) I, II, III and IV
Ans: C
49. The Committees related to industrial licensing policy are
I. Arjun Sengupta Committee
II. D.G. Karve Committee
III. Subimal Dutt Committee
IV. R.K. Hazari Committee
Codes :
(A) I and II
(B) II and III
(C) III and IV
(D) I, II and III
Ans: C
50. Which Industrial Policy Resolution gave the public sector a strategic role in the Indian Economy ?
(A) 1948 (B) 1956
(C) 1977 (D) 1980
Ans: B
51. Average industrial growth rate during Tenth Plan period was
(A) 5.3% (B) 8.8%
(C) 10.2% (D) 15.3%
Ans: B
52. Suggest the correct choices about the nature of the Environmental Economics :
I. Nature of Market failure is similar to public goods under public finance.
II. Willingness to pay can be negative.
III. It deals for items which are not used.
IV. It deals for items which are used.
Codes :
(A) I, II, III & IV
(B) I, II & III
(C) II, III & IV
(D) II & IV
Ans: C
53. Which of the following methods would be used for estimation of price change of a house due to either pollution or good environment like existence of park and scenic beauty ?
(A) Hedonic Method
(B) Contingent Valuation Method
(C) Externality Effects
(D) All of the above
Ans: A
54. In a life table which of the following does not fit ?
(A) There are eight columns in a life table.
(B) It tells the age-specific mortality rate.
(C) Age-specific birth rate can be derived from a life table.
(D) Age-specific life expectancy can be estimated
Ans: C
55. Optimum theory of population tells about the relationship between
(A) Population and food supply
(B) Population and overall resources
(C) Dependent population and working population
(D) Present population and growth rate of population
Ans: B
56. What is meant by ‘population neutralism’ ?
(A) Impact of population growth on economic growth is negligible.
(B) Growth rate of population is hovering around stationary population.
(C) Impact of population growth on food supply is neutral.
(D) Due to population growth, change in age structure is almost neutral.
Ans: A
57. What is the essence of wage goods model explained by Professor P.R. Brahmananda in the Indian economy context ?
(A) It tells about low wage rate in the agriculture.
(B) It tells about low wage rate for labour in the economy.
(C) It tells about shift of labour from agriculture to industry.
(D) It tells about the impact of the shortage of food items on the wage rate and growth rate of the economy.
Ans: D
58. Match the highest crop production states given in List – I with List – II from the given code :
List – I (States)
List – II (Highest crop production)
a. West Bengal 1. Total course cereals
b. Uttar Pradesh 2. Rice
c. Maharashtra 3. Potato
d. Gujarat 4. Groundnut
Codes :
a b c d
(A) 2 3 1 4
(B) 3 2 1 4
(C) 4 2 3 1
(D) 1 3 4 2
Ans: A
59. About minimum support price, find out the correct combinations :
I. If market price is higher, farmers will sell to the government.
II. It ensures minimum assured price for the produce of the farmers.
III. It helps in food security mission.
IV. This is highly rewarding to farmers because they earn huge profits on their produce.
Codes :
(A) I, II & IV (B) II, III & IV
(C) II & III (D) II & IV
Ans: C
60. Which of the followings have been important in growth of rice and wheat output in India after initiating green revolution programme ?
I. Changes in cropping pattern
II. Improved yields
III. Crop insurance
IV. Increased area under cultivation
Codes :
(A) II, III & IV (B) I, II & IV
(C) I, II & III (D) I, III & IV
Ans: B
61. ‘Green agriculture’ involves
(A) organic farming and emphasis on horticulture
(B) avoiding pesticides, chemical fertilizers while focussing on horticulture and floriculture
(C) integrated pest management, integrated nutrient supply and integrated natural resource management
(D) emphasis on food crops, horticulture and floriculture
Ans: C
62. The technique used to estimate the over-identified system of simultaneous equations is
(A) ordinary least squares
(B) maximum likelihood
(C) limited information maximum likelihood
(D) two stage least square
Ans: D
63. The sources of auto correlation among the following are :
I. Omitted explanatory variables
II. Interpolation in the statistical observation
III. Mis-specification of the true random term ‘ν’
IV. Economic variables to move together over time
Codes :
(A) I and II only
(B) I, II and III only
(C) I, III and IV only
(D) All of the above
Ans: B
(A) 5.3% (B) 8.8%
(C) 10.2% (D) 15.3%
Ans: B
52. Suggest the correct choices about the nature of the Environmental Economics :
I. Nature of Market failure is similar to public goods under public finance.
II. Willingness to pay can be negative.
III. It deals for items which are not used.
IV. It deals for items which are used.
Codes :
(A) I, II, III & IV
(B) I, II & III
(C) II, III & IV
(D) II & IV
Ans: C
53. Which of the following methods would be used for estimation of price change of a house due to either pollution or good environment like existence of park and scenic beauty ?
(A) Hedonic Method
(B) Contingent Valuation Method
(C) Externality Effects
(D) All of the above
Ans: A
54. In a life table which of the following does not fit ?
(A) There are eight columns in a life table.
(B) It tells the age-specific mortality rate.
(C) Age-specific birth rate can be derived from a life table.
(D) Age-specific life expectancy can be estimated
Ans: C
55. Optimum theory of population tells about the relationship between
(A) Population and food supply
(B) Population and overall resources
(C) Dependent population and working population
(D) Present population and growth rate of population
Ans: B
56. What is meant by ‘population neutralism’ ?
(A) Impact of population growth on economic growth is negligible.
(B) Growth rate of population is hovering around stationary population.
(C) Impact of population growth on food supply is neutral.
(D) Due to population growth, change in age structure is almost neutral.
Ans: A
57. What is the essence of wage goods model explained by Professor P.R. Brahmananda in the Indian economy context ?
(A) It tells about low wage rate in the agriculture.
(B) It tells about low wage rate for labour in the economy.
(C) It tells about shift of labour from agriculture to industry.
(D) It tells about the impact of the shortage of food items on the wage rate and growth rate of the economy.
Ans: D
58. Match the highest crop production states given in List – I with List – II from the given code :
List – I (States)
List – II (Highest crop production)
a. West Bengal 1. Total course cereals
b. Uttar Pradesh 2. Rice
c. Maharashtra 3. Potato
d. Gujarat 4. Groundnut
Codes :
a b c d
(A) 2 3 1 4
(B) 3 2 1 4
(C) 4 2 3 1
(D) 1 3 4 2
Ans: A
59. About minimum support price, find out the correct combinations :
I. If market price is higher, farmers will sell to the government.
II. It ensures minimum assured price for the produce of the farmers.
III. It helps in food security mission.
IV. This is highly rewarding to farmers because they earn huge profits on their produce.
Codes :
(A) I, II & IV (B) II, III & IV
(C) II & III (D) II & IV
Ans: C
60. Which of the followings have been important in growth of rice and wheat output in India after initiating green revolution programme ?
I. Changes in cropping pattern
II. Improved yields
III. Crop insurance
IV. Increased area under cultivation
Codes :
(A) II, III & IV (B) I, II & IV
(C) I, II & III (D) I, III & IV
Ans: B
61. ‘Green agriculture’ involves
(A) organic farming and emphasis on horticulture
(B) avoiding pesticides, chemical fertilizers while focussing on horticulture and floriculture
(C) integrated pest management, integrated nutrient supply and integrated natural resource management
(D) emphasis on food crops, horticulture and floriculture
Ans: C
62. The technique used to estimate the over-identified system of simultaneous equations is
(A) ordinary least squares
(B) maximum likelihood
(C) limited information maximum likelihood
(D) two stage least square
Ans: D
63. The sources of auto correlation among the following are :
I. Omitted explanatory variables
II. Interpolation in the statistical observation
III. Mis-specification of the true random term ‘ν’
IV. Economic variables to move together over time
Codes :
(A) I and II only
(B) I, II and III only
(C) I, III and IV only
(D) All of the above
Ans: B
64. Input-Output Technique was invented by
(A) Gunnar Myrdal
(B) Wassily Leontief
(C) Hollis B. Chenery
(D) Robert Solow
Ans: B
65. Which of the following statements is true concerning the optimal solution of linear program with two decision variables ?
(A) There is only one solution to a linear program.
(B) The optimal solution is either an extreme point or is on a line connecting extreme points.
(C) All resources must be used up by an optimal solution.
(D) All of the above.
Ans: B
66. Verdoon’s law is about the
(A) positive relation between the growth of population, employment and output with the growth of production per head.
(B) negative relation between the growth of population, employment and output with the growth of production per head.
(C) positive relation between population growth and employment.
(D) negative relation between population growth and employment.
Ans: A
67. Which of the following statements is true concerning standard regression model ?
(A) Y has a probability distribution
(B) X has a probability distribution
(C) The disturbance term is assumed to be correlated with X
(D) For an adequate model the residual (û) will be zero for all sample data points
Ans: A
68. Which of the following statements are true concerning a triangular or recursive system ?
(i) The parameters can be validly estimated using separate applications of OLS to each equation.
(ii) The independent variables may be correlated with the error terms in other equations
(iii) An application of 2 SLS would lead to unbiased but inefficient parameter estimates
(iv) The independent variables may be correlated with error terms in the equations in which they appear as independent variables.
(A) (ii) and (iv) only
(B) (i) and (iii) only
(C) (i), (ii) and (iii) only
(D) (i), (ii), (iii) and (iv)
Ans: C
69. What would be the consequences for the OLS estimator if heteroscedasticity is present in a regression model but ignored ?
(A) It will be biased.
(B) It will be inconsistent.
(C) It will be inefficient.
(D) All (A), (B) and (C) will be true.
Ans: C
70. Match the following
List – I List – II
a. Unit Root Test 1. Durbin Watson Test
b. Contingency Table 2. Student’s t-test
c. Regression Coefficient 3. Stationarity
d. Autocorrelation 4. χ2 -test
Codes :
a b c d
(A) 2 3 1 4
(B) 4 2 3 1
(C) 3 4 2 1
(D) 3 2 1 4
Ans: C
(A) Gunnar Myrdal
(B) Wassily Leontief
(C) Hollis B. Chenery
(D) Robert Solow
Ans: B
65. Which of the following statements is true concerning the optimal solution of linear program with two decision variables ?
(A) There is only one solution to a linear program.
(B) The optimal solution is either an extreme point or is on a line connecting extreme points.
(C) All resources must be used up by an optimal solution.
(D) All of the above.
Ans: B
66. Verdoon’s law is about the
(A) positive relation between the growth of population, employment and output with the growth of production per head.
(B) negative relation between the growth of population, employment and output with the growth of production per head.
(C) positive relation between population growth and employment.
(D) negative relation between population growth and employment.
Ans: A
67. Which of the following statements is true concerning standard regression model ?
(A) Y has a probability distribution
(B) X has a probability distribution
(C) The disturbance term is assumed to be correlated with X
(D) For an adequate model the residual (û) will be zero for all sample data points
Ans: A
68. Which of the following statements are true concerning a triangular or recursive system ?
(i) The parameters can be validly estimated using separate applications of OLS to each equation.
(ii) The independent variables may be correlated with the error terms in other equations
(iii) An application of 2 SLS would lead to unbiased but inefficient parameter estimates
(iv) The independent variables may be correlated with error terms in the equations in which they appear as independent variables.
(A) (ii) and (iv) only
(B) (i) and (iii) only
(C) (i), (ii) and (iii) only
(D) (i), (ii), (iii) and (iv)
Ans: C
69. What would be the consequences for the OLS estimator if heteroscedasticity is present in a regression model but ignored ?
(A) It will be biased.
(B) It will be inconsistent.
(C) It will be inefficient.
(D) All (A), (B) and (C) will be true.
Ans: C
70. Match the following
List – I List – II
a. Unit Root Test 1. Durbin Watson Test
b. Contingency Table 2. Student’s t-test
c. Regression Coefficient 3. Stationarity
d. Autocorrelation 4. χ2 -test
Codes :
a b c d
(A) 2 3 1 4
(B) 4 2 3 1
(C) 3 4 2 1
(D) 3 2 1 4
Ans: C
71. ‘Multi-dimensional Poverty Index’ (MPI) is a new index to be included in
(A) World Human Report
(B) Human Development Report
(C) World Development Report
(D) India’s Human Development Report
Ans: B
72. Which is the better measure of welfare ?
(A) National Income
(B) Per Capita Income
(C) Per Capita Disposable Income
(D) Gross National Product
Ans: C
73. Which of the following year of the 11th Five Year Plan registered the highest GDP growth rate ?
(A) 2007-08
(B) 2008-09
(C) 2009-10
(D) 2010-11
Ans: A
74. What is the main purpose of U.N.E.P. ?
(A) Equal development
(B) Economic development
(C) Reduction in temperature
(D) Sustainable development
Ans: D
75. Foodgrains in India are canalized by
(A) ONGC
(B) OIL
(C) FCI
(D) MMTC
Ans: C
76. As per provisional data released by C.S.O. for Q1 of 2012-13, the GDP growth has been estimated at
(A) 5.1%
(B) 5.5%
(C) 5.9%
(D) 6.2%
Ans: B
77. In whose economic theories, Malthus’ theories are in the base ?
(A) Adam Smith
(B) Ricardo
(C) Keynes
(D) Robins
Ans: C
78. There are four phases of a business cycle. Identify the correct sequence of the occurrence of these phases :
(A) Recovery, Recession, Expansion, Depression
(B) Recovery, Expansion, Depression, Recession
(C) Depression, Expansion, Recession, Recovery
(D) Recovery, Expansion, Recession, Depression
Ans: D
79. The Total Factor Productivity (TFP) in agriculture during the 11th plan in India
(A) Increased
(B) Declined
(C) Remain unchanged
(D) Had no specific pattern
Ans: A
80. Income elasticity of demand for food in developed countries is less than
(A) zero
(B) 1
(C) 2
(D) 3
Ans: B
81. ‘Apna Khet, Apna Kaam’ (i.e. own field, own work) is a new scheme under MNREGA and it was initiated in the State
(A) Punjab
(B) Gujarat
(C) Rajasthan
(D) Madhya Pradesh
Ans: A
82. ‘Price Scissors’ refer to
(A) Relative price of fuel and industrial goods
(B) Relative price of industrial goods in terms of agricultural goods
(C) Relative price of imported goods in terms of the exported goods
(D) None of the above
Ans: B
83. Assertion (A) : Yellow Revolution increased the production of seeds.
Reason (R) : White Revolution increased the production of milk.
Codes :
(A) Both (A) and (R) are true and (R) is the correct explanation of (A).
(B) Both (A) and (R) are true, but (R) is not the correct explanation of (A).
(C) (A) is true, but (R) is false.
(D) (A) is false, but (R) is true.
Ans: B
84. The immediate cause for the collapse of the Bretton Woods system was
(A) the expectation that the U.S. would soon be forced to devalue the dollar.
(B) the massive flight of liquid capital from the U.S.
(C) the attempt by three small European Central Banks to convert part of their dollar holdings into gold at the Fed.
(D) All of the above
Ans: D
85. In case of Fixed Exchange Rate regime adjustment in Balance of Payments takes place through
(A) changes in price level
(B) changes in exchange rate
(C) changes in interest rate
(D) none of the above
Ans: A
86. A spot Foreign Exchange Transaction refers to
(A) the purchase or sale of foreign exchange for delivery within two business days.
(B) the sale of foreign exchange for delivery.
(C) the purchase of foreign exchange for delivery.
(D) none of the above.
Ans: A
87. Regarding M.F.N. (Most Favoured Nation) clause, find out the correct statement :
(A) It guarantees special privilege to the contracting parties.
(B) It guarantees only equal treatment.
(C) The unconditional M.F.N. clause seems to be more equitable than the conditional one.
(D) The conditional M.F.N. clause confers significant rights on the contracting party.
Ans: B
88. Match List-I with List-II :
List – I List – II
(a) Hamilton List (1) Trade creation and Trade diversion effects
(b) MarshallLearner (2) Indian Industry
(c) F.Y. Edgeworth (3) Elasticity approach
(d) Jacob Viner (4) Impoverishing growth
Codes :
(a) (b) (c) (d)
(A) (2) (3) (1) (4)
(B) (2) (3) (4) (1)
(C) (3) (2) (4) (1)
(D) (3) (2) (1) (4)
Ans: B
(A) World Human Report
(B) Human Development Report
(C) World Development Report
(D) India’s Human Development Report
Ans: B
72. Which is the better measure of welfare ?
(A) National Income
(B) Per Capita Income
(C) Per Capita Disposable Income
(D) Gross National Product
Ans: C
73. Which of the following year of the 11th Five Year Plan registered the highest GDP growth rate ?
(A) 2007-08
(B) 2008-09
(C) 2009-10
(D) 2010-11
Ans: A
74. What is the main purpose of U.N.E.P. ?
(A) Equal development
(B) Economic development
(C) Reduction in temperature
(D) Sustainable development
Ans: D
75. Foodgrains in India are canalized by
(A) ONGC
(B) OIL
(C) FCI
(D) MMTC
Ans: C
76. As per provisional data released by C.S.O. for Q1 of 2012-13, the GDP growth has been estimated at
(A) 5.1%
(B) 5.5%
(C) 5.9%
(D) 6.2%
Ans: B
77. In whose economic theories, Malthus’ theories are in the base ?
(A) Adam Smith
(B) Ricardo
(C) Keynes
(D) Robins
Ans: C
78. There are four phases of a business cycle. Identify the correct sequence of the occurrence of these phases :
(A) Recovery, Recession, Expansion, Depression
(B) Recovery, Expansion, Depression, Recession
(C) Depression, Expansion, Recession, Recovery
(D) Recovery, Expansion, Recession, Depression
Ans: D
79. The Total Factor Productivity (TFP) in agriculture during the 11th plan in India
(A) Increased
(B) Declined
(C) Remain unchanged
(D) Had no specific pattern
Ans: A
80. Income elasticity of demand for food in developed countries is less than
(A) zero
(B) 1
(C) 2
(D) 3
Ans: B
81. ‘Apna Khet, Apna Kaam’ (i.e. own field, own work) is a new scheme under MNREGA and it was initiated in the State
(A) Punjab
(B) Gujarat
(C) Rajasthan
(D) Madhya Pradesh
Ans: A
82. ‘Price Scissors’ refer to
(A) Relative price of fuel and industrial goods
(B) Relative price of industrial goods in terms of agricultural goods
(C) Relative price of imported goods in terms of the exported goods
(D) None of the above
Ans: B
83. Assertion (A) : Yellow Revolution increased the production of seeds.
Reason (R) : White Revolution increased the production of milk.
Codes :
(A) Both (A) and (R) are true and (R) is the correct explanation of (A).
(B) Both (A) and (R) are true, but (R) is not the correct explanation of (A).
(C) (A) is true, but (R) is false.
(D) (A) is false, but (R) is true.
Ans: B
84. The immediate cause for the collapse of the Bretton Woods system was
(A) the expectation that the U.S. would soon be forced to devalue the dollar.
(B) the massive flight of liquid capital from the U.S.
(C) the attempt by three small European Central Banks to convert part of their dollar holdings into gold at the Fed.
(D) All of the above
Ans: D
85. In case of Fixed Exchange Rate regime adjustment in Balance of Payments takes place through
(A) changes in price level
(B) changes in exchange rate
(C) changes in interest rate
(D) none of the above
Ans: A
86. A spot Foreign Exchange Transaction refers to
(A) the purchase or sale of foreign exchange for delivery within two business days.
(B) the sale of foreign exchange for delivery.
(C) the purchase of foreign exchange for delivery.
(D) none of the above.
Ans: A
87. Regarding M.F.N. (Most Favoured Nation) clause, find out the correct statement :
(A) It guarantees special privilege to the contracting parties.
(B) It guarantees only equal treatment.
(C) The unconditional M.F.N. clause seems to be more equitable than the conditional one.
(D) The conditional M.F.N. clause confers significant rights on the contracting party.
Ans: B
88. Match List-I with List-II :
List – I List – II
(a) Hamilton List (1) Trade creation and Trade diversion effects
(b) MarshallLearner (2) Indian Industry
(c) F.Y. Edgeworth (3) Elasticity approach
(d) Jacob Viner (4) Impoverishing growth
Codes :
(a) (b) (c) (d)
(A) (2) (3) (1) (4)
(B) (2) (3) (4) (1)
(C) (3) (2) (4) (1)
(D) (3) (2) (1) (4)
Ans: B
89. Under a managed floating exchange rate system, the Nation’s monetary authorities intervene in Foreign Exchange Markets to
(A) smooth out short-run fluctuations in exchange rates
(B) smooth out long-run fluctuations in exchange rates
(C) smooth out short-run and longrun fluctuations in exchange rates
(D) keep exchange rates fixed among a group of nations
Ans: A
90. Which of the following is related with optimum currency area ?
(A) Optimal geographical area for a single currency
(B) Optimal geographical area for several currencies whose exchange rates are relatively pegged
(C) Single currency or the pegged currencies fluctuate jointly visà-vis other currencies
(D) All the above
Ans: D
91. Which of the following is true with respect to the monetary approach to the balance of payments ?
(A) A balance of payments deficit results from an excess supply of money in the nation.
(B) A balance of payments surplus results from an excess demand for money.
(C) Balance of payments disequilibrium are automatically corrected in the long run.
(D) All the above
Ans: D
92. Which one of the following tax is within the jurisdiction of the Central Government as enumerated in List I of Seventh Schedule of the
Constitution of India ?
(A) Taxes on mineral rights subject to any limitation imposed by the Parliament
(B) Taxes on the consumption and sale of electricity
(C) Taxes on sale and purchase of newspapers and on advertisements therein
(D) Excise on alcoholic liquors for human consumption, opium, Indian hemp and other narcotics
Ans: C
93. Grants from the Centre to the States under the recommendations of Finance Commission are known as
(A) Plan grants
(B) Development assistance
(C) Statutory grants
(D) Discretionary grants
Ans: C
94. Match the items given in List I with those in List II :
List – I List – II
a. Committee on Taxation of Agricultural Wealth and Income, 1972 1. Raja J. Chelliah
b. Direct Taxes Enquiry Committee, 1970 2. L.K. Jha
c. Tax Reform Committee, 1991 3. K.N. Wanchoo
d. Indirect Tax Enquiry Committee, 1976 4. K.N. Raj
Codes :
a b c d
(A) 4 1 2 3
(B) 4 3 1 2
(C) 3 2 1 4
(D) 2 3 1 4
Ans: B
95. The biggest holder of Government of India dated securities :
(A) Reserve Bank of India
(B) Life Insurance Corporation of India
(C) Employees Provident Fund
(D) Commercial Banks
Ans: D
96. Arrange the introduction of the following taxes in India in chronological order :
I. Service tax
II. Income tax
III. Banking cash transaction tax
IV. Gift tax
Codes :
(A) II, IV, I, III
(B) II, I, III, IV
(C) II, III, I, IV
(D) IV, II, I, III
Ans: A
97. Who amongst the following has not worked for estimation of Black Money in India ?
(A) N. Kaldor
(B) Dr. D.K. Rangnekar
(C) O.P. Chopra
(D) Sukhamoy Chakravarthy
Ans: D
98. For which of the following items of household consumption expenditures in India, NSSO takes the reference period as 365 days ?
(A) Clothing, footwear, bedding, education etc.
(B) Edible oil, fish & meat, egg
(C) Vegetables, fruits, spices, beverages & processed food
(D) All other food, fuel & light, misc. goods & services
Ans: A
99. What is the average monthly per capita expenditure (modified mixed recall period) for rural India in 2009-10 ?
(A) ` 845.54
(B) ` 1053.64
(C) ` 1322.25
(D) ` 1984.46
Ans: B
100. What is the target for total outstanding liabilities at the end of 2015-16 as per medium term Fiscal Policy Statement of the Union
Budget 2013-14 (Percent of GDP) ?
(A) 42.3
(B) 44.5
(C) 41.1
(D) 47.8
Ans: A
(A) smooth out short-run fluctuations in exchange rates
(B) smooth out long-run fluctuations in exchange rates
(C) smooth out short-run and longrun fluctuations in exchange rates
(D) keep exchange rates fixed among a group of nations
Ans: A
90. Which of the following is related with optimum currency area ?
(A) Optimal geographical area for a single currency
(B) Optimal geographical area for several currencies whose exchange rates are relatively pegged
(C) Single currency or the pegged currencies fluctuate jointly visà-vis other currencies
(D) All the above
Ans: D
91. Which of the following is true with respect to the monetary approach to the balance of payments ?
(A) A balance of payments deficit results from an excess supply of money in the nation.
(B) A balance of payments surplus results from an excess demand for money.
(C) Balance of payments disequilibrium are automatically corrected in the long run.
(D) All the above
Ans: D
92. Which one of the following tax is within the jurisdiction of the Central Government as enumerated in List I of Seventh Schedule of the
Constitution of India ?
(A) Taxes on mineral rights subject to any limitation imposed by the Parliament
(B) Taxes on the consumption and sale of electricity
(C) Taxes on sale and purchase of newspapers and on advertisements therein
(D) Excise on alcoholic liquors for human consumption, opium, Indian hemp and other narcotics
Ans: C
93. Grants from the Centre to the States under the recommendations of Finance Commission are known as
(A) Plan grants
(B) Development assistance
(C) Statutory grants
(D) Discretionary grants
Ans: C
94. Match the items given in List I with those in List II :
List – I List – II
a. Committee on Taxation of Agricultural Wealth and Income, 1972 1. Raja J. Chelliah
b. Direct Taxes Enquiry Committee, 1970 2. L.K. Jha
c. Tax Reform Committee, 1991 3. K.N. Wanchoo
d. Indirect Tax Enquiry Committee, 1976 4. K.N. Raj
Codes :
a b c d
(A) 4 1 2 3
(B) 4 3 1 2
(C) 3 2 1 4
(D) 2 3 1 4
Ans: B
95. The biggest holder of Government of India dated securities :
(A) Reserve Bank of India
(B) Life Insurance Corporation of India
(C) Employees Provident Fund
(D) Commercial Banks
Ans: D
96. Arrange the introduction of the following taxes in India in chronological order :
I. Service tax
II. Income tax
III. Banking cash transaction tax
IV. Gift tax
Codes :
(A) II, IV, I, III
(B) II, I, III, IV
(C) II, III, I, IV
(D) IV, II, I, III
Ans: A
97. Who amongst the following has not worked for estimation of Black Money in India ?
(A) N. Kaldor
(B) Dr. D.K. Rangnekar
(C) O.P. Chopra
(D) Sukhamoy Chakravarthy
Ans: D
98. For which of the following items of household consumption expenditures in India, NSSO takes the reference period as 365 days ?
(A) Clothing, footwear, bedding, education etc.
(B) Edible oil, fish & meat, egg
(C) Vegetables, fruits, spices, beverages & processed food
(D) All other food, fuel & light, misc. goods & services
Ans: A
99. What is the average monthly per capita expenditure (modified mixed recall period) for rural India in 2009-10 ?
(A) ` 845.54
(B) ` 1053.64
(C) ` 1322.25
(D) ` 1984.46
Ans: B
100. What is the target for total outstanding liabilities at the end of 2015-16 as per medium term Fiscal Policy Statement of the Union
Budget 2013-14 (Percent of GDP) ?
(A) 42.3
(B) 44.5
(C) 41.1
(D) 47.8
Ans: A