Economics Determination of Income and Employment MCQ Question Answers for Various Entrance Exams

 

1. The index for wholesale prices is called Wholesale Price Index (WPI). In countries like USA, it is referred to as _________
a.
b.
c.
d.

2. The major economic activities of the government that affect the aggregate demand for final goods and services can be summarized by the _______&_________.
a.
b.
c.
d.

3. ‘Investment goods’ (such as machines) are also part of the final goods – they are not intermediate goods like raw materials.
a.
b.
c.
d.

4. The concept that the aggregate value of goods and services produced in an economy is going around in a circular way. Either as factor payments, or as expenditures on goods and services, or as the value of aggregate production is Called as _______________
a.
b.
c.
d.

5. The inventory investment can take place due to
a.
b.
c.
d.

6. _______ are the unsold goods, unused raw materials or semi-finished goods which a firm carries from a year to the next
a.
b.
c.
d.

7. If MPC is 0.6, Then the investment Multiplier will be
a.
b.
c.
d.

8. The Marginal Propensity to Save (MPS) is defined as the rate of change in ______ as income increases.
a.
b.
c.
d.

9. When Planned Savings is less than planned Investment, then: _______
a.
b.
c.
d.

10. Even if income is zero, some consumption still takes place. Since this level of consumption is independent of income, it is called _______ consumption.
a.
b.
c.
d.

11. The most important determinant off consumption demand is __________
a.
b.
c.
d.

12. A = __ +__ is the total autonomous expenditure in the economy.
a.
b.
c.
d.

13. aggregate output is determined solely by the level of aggregate demand. This is known as________.
a.
b.
c.
d.

14. A consumption function describes the relation between ­­­­________& ________.
a.
b.
c.
d.

15. The marginal propensity to consume may be explained as a rate of change of consumption as income changes.
a.
b.
c.
d.

16. The algebraic Relationship Between Multiplier and MPC Is –
a.
b.
c.
d.

17. If the demand is more than the level of output produced at full employment level. This situation is called the situation of excess _________. It leads to rise in prices in the __________
a.
b.
c.
d.

18. Paradox of Thrift Means If all the people of the economy increase the proportion of income they save the total value of savings in the economy will
a.
b.
c.
d.

19. When a Country does not have any income, its citizens still consume Rs. 100 worth of goods. Country’s autonomous consumption is 100. Its marginal propensity to consume is 0.8. This means that if income goes up by Rs. 100 then consumption will go up by________
a.
b.
c.
d.

20. Marginal Propensity to Consume is the change in consumption per unit change in_______.
a.
b.
c.
d.


 


 
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