50.

Dirty Floating is related to:

(a) Flexible system of exchange rate

(b) Fixed system of exchange rate

(c) Either of these

(d) None of these

51. Which of the following is a zero-sum game?

(a) Prisoners dilemma.

(b) Competition for market share.

(c) Pricing strategy

(d) None of the above is correct

52. Which of the following is NOT an example of a transfer payment in the sense of the national income accounts?

(a) Government family allowances

(b) Public unemployment insurance benefits

(c) Dividends paid by corporations to stockholders

(d) Disability pensions paid from the social insurance system

53. The difference between real and nominal GDP is...

(a) Nominal GDP only accounts for citizens.

(b) Nominal GDP uses price-levels of some base year.

(c) Nominal GDP uses actual price-levels.

(d) Real GDP also includes services, whereas nominal GDP only takes goods into account.

54. A recession is a decline in:

(a) The unemployment rate that lasts six months or longer

(b) Real GDP that lasts six months or longer

(c) Potential GDP that lasts six months or longer

(d) The inflation rate that lasts six months or longer

55. For a person to keep his real income steady at a certain level from one year to the next, his nominal income must:

(a) Stay the same as the price index rises

(b) Rise as fast as the price index

(c) Fall if the price index rises

(d) Rise if the price index falls

56. If the GDP gap is positive, then:

(a) The inflation rate is falling

(b) Actual GDP is greater than potential GDP

(c) Potential GDP is greater than actual GDP

(d) The unemployment rate is rising

57. The government makes the provision of which goods those cannot be provided through the market:

(a) private and public goods

(b) public and merit goods

(c) public and necessary goods.

(d) Giffen and merit goods

58. Which of the following parameter consist of interest, dividend, fees and other receipts for services of the
government:

(a) Non-tax expenses

(b) Tax expenses

(c) Non-tax revenue

(d) Tax revenue

59. A good taxation system should be used to:

(a) finance public services

(b) follow higher taxation.

(c) no taxation

(d) finance private services

60. Primary deficit is obtained by deducting interest payments from the:

(a) Fiscal deficit

(b) Revenue deficit

(c) Budgetary deficit.

(d) Monetized deficit

61. According to Cambridge equation, the value of money depends upon:

(a) Demand for money

(b) Supply of money

(c) Demand for goods and services

(d) All of the above

62. The quantity demanded of money rises:

(a) As the repo rate increases

(b) As the repo rate falls

(c) As the supply of money falls

(d) As the number of banks rises.

63. When the Central Bank intends to expand the credit, it should:

(a) Raise the margin requirements

(b) Raise the variable reserve ratio

(c) Lower the bank rate

(d) Purchase government securities in the open market.

64. Which of the following is not an instrument of selective credit control?

(a) Margin requirements

(b) Open market operation

c) Credit rationing

(d) None of the above

65. Which among the following is called the rate of interest charged by RBI for lending money to various commercial
banks by rediscounting of the bills in India?

(a) Bank rate

(b) Discount window.

(c) Marginal Standing facility

(d) Overnight rate

66. The process of selling of the products at a price less than on going price in the market is known as:

(a) Quota

(b) Tariff

(c) Subsidies

(d) Dumping

67. Comparative advantage is determined by:

(a) the amount of resources needed to produce a good

(b) the money cost of producing any good.

(c) The opportunity cost of producing any good

(d) Absolute advantage and production possibilities combined.

68. A lumps sum tax per unit on imports is known as:

(a) A specific tariff

(b) An effective tariff

(c) An effective quota

(d) A specific quota

69. A key effect of devaluation is that it:

(a) Makes the domestic currency cheaper relative to other currencies

(b) Makes the domestic currency dearer relative to other currencies

(c) Makes the foreign currency Cheaper relative to other currencies

(d) Leaves the relative value unchanged

70. Central Government can impose the safeguard duty if it is satisfied that:

(a) Any article is imported into India in increased quantities

(b) Such increased importation is causing or threatening to cause serious injury to domestic industry.

(c) Either A or B

(d) Both A&B

71. Countervailing duty shall not be levied unless it is determined that:

(a) The subsidy relates to export performance..

(b) The subsidy relates to the use of domestic goods over imported goods in the export article

(c) The subsidy has been conferred on a limited number of persons engaged in the manufacture, production or export
of articles.
(d) All the above

72. Terms of trade in developing countries are generally unfavorable because:

(a) They export manufacturing products.

(b) They export primary products.

(c) They export few goods.

(d) Both A and C

73. Most tariffs have:

(a) only revenue effects.

(b) only protective effects

(c) both protective and revenue effects

(d) neither protective or revenue effects.

74. Which of the following statements is/are correct regarding FDI under automatic route?

a. FDI in India under the automatic route does not require prior approval either by the Government of India or the
Reserve Bank of India.

b. Investors are only required to notify the concerned regional office of the RBI before receipt of inward remittances
and file required documents. with that office before the issue of shares to foreign investors.

(a) 1 only

(b) 2 only

(c) Both 1 and 2

(d) Neither 1 nor 2

75. What is a Global Depository Receipt?

(a) It is a receipt issued by multinational banks on deposit of money.

(b) It is a receipt issued by stock exchange to bank clearing mechanism.

(c) It is a receipt issued by an overseas bank is lieu of shares of a domestic company.

(d) It is a receipt issued by stock exchange on investment by foreign portfolio investor.

76. Any act of interference by a Central Bank like the RBI in influencing the exchange rate is referred to as which of
the following in India?

(a) Dirty Floats

(b) Managed Floats

(c) Fixed Floats

(d) Market Stabilization Floats

77. Which of the following is a FALSE statement?

(a) the very long run focuses on the growth of productive capacity

(b) in the very long run, the productive capacity is assumed to be given

(c) in the very short run, shifts in aggregate demand determine how much output is produced

(d) fluctuations in the rates of inflation and unemployment are important long-run issues

78. Positive economics means:

(a) Does not depend on market interactions,

(b) only looks at the best parts of the economy.

(c) Examines how the economy works (as opposed to how it should work)

(d) is very subjective.

79. A nation's gross domestic product (GDP):

(a) can be found by summing C + I + G + Xn.

(b) is the dollar value of the total output produced by its citizens, regardless. of where they are living.

(c) can be found by summing C+ S + G + Xn.

(d) is always some amount less than its NDP.

80. Gross investment refers to:

(a) private investment minus public investment.

(b) net investment plus replacement investment.

(c) net investment after it has been "inflated" for changes in the price level.

(d) net investment plus net exports.

81. The amount of after-tax income received by households is measured by:

(a) discretionary income.

(b) national income.

(c) disposable income.

(d) personal income.

82. Which of the following represents the total amount of money the government owes to external creditors and
domestic lenders?

(a) National debt

(b) Budget surplus

(c) Fiscal deficit

(d) None of these

83. What is the primary goal of countercyclical fiscal policy in budgeting?

(a) Maximizing government revenue.

(b) Stabilizing the economy during economic downturns.

(c) Minimizing government intervention.

(d) None of these

84. Which type of investment is more susceptible to capital flight during times of economic instability?

(a) FDI

(b) FPI

(c) Both FDI and FPI equally

(d) Neither FDI nor FPI

85. The concept of "animal spirits" in Keynesian theory refers to:

(a) The unpredictable behaviour of financial markets

(b) psychological factors influencing economic decisions.

(c) Government regulations affecting business confidence.

(d) The impact of interest rates on investment

86. Mr Amit, a stock market trader through inside information, comes to know that share price of X Ltd is likely to go
up in future, so he purchases the shares to make a gain by selling them later at higher price. It is a case of:

(a) Moral Hazard

(b) Asymmetric Information.

(c) Free Riding

(d) None of the above.

87. Which concept involves a one-shot injection of government expenditure into a depressed economy with the aim of
boosting business confidence and encouraging larger private investment?

(a) Pump Priming

(b) Deficit Financing

(c) Compensatory Spending

(d) Public Spending

88. What will be the value of Credit Multiplier when the Required Reserve ratio is 50%?

(a) 4

(b) 2

(c) 3

89. Which of the following measures involve total ban imposed by government on import or export of some or all
commodities to particular country or regions for a specified or indefinite period?

(d) 1

(a) Import Quotas

(b) Anti-Dumping Duties

(c) Escalated Tariffs

(d) Embargos

90. Which of the following is not one of the features of New Trade Theory by Paul Krugman?

(a) Countries which trade in similar goods are natural trade partners

(b) It is based on labour theory of value

(c) Network effect as means of engaging in international trade

(d) It focuses more on economies of scale.

91. Which one is a component of profit?

(a) Dividend

(b) Undistributed Profit

(c) Corporate Profit Tax

(d) All of these

92. The particular level of AD which is equal to AS is called

(a) equilibrium demand

(b) effective demand

(c) derived demand.

(d) None of the above

93. What is meant by the "institutional framework" of an economy?

(a) The maximum capacity of the economy in the production process

(b) The level of investment in human capital

(c) The system of formal laws, regulations and procedures that shape economic activity in the economy

(d) Subsidies and tax concessions used to improve employment opportunities in assisted areas of the economy

94. The Distinction between Selling Cost and Production cost was made by:

(a) Chamberlin

(b) Sweezy

(c) Mrs Joan Robinson

(d) None of these

95. E-NAM is -

(a) a pan-India electronic trading portal which networks the existing APMC mandis

(b) with the objective of creating a unified national market for agricultural commodities

(c) Both a & b

(d) None of these

96. India's Rank in Ease of Doing Business is:

(a) 45

(b) 54

(c) 63

(d) None of these

97. Niti Aayog will work towards the objective:

(a) To evolve a shared vision of national development priorities, sectors and strategies with active involvement of
states

(b) To foster cooperative federalism

(c) To develop mechanisms to formulate credible plans at the village level

(d) All the above

98. SEBI was given statutory recognition in:

(a) 1985

(b) 1990

(c) 1992

(d) None of these

99. The Three component of FDI is:

(a) equity capital

(b) reinvested earnings

(c) Intra company loans

(d) All the above

100. Which of the following tariff is charged on imports on most-favoured nation.(MFN) basis:

(a) bound tariff

(b) applied tariff

(c) prohibitive tariff

(d) None of these