KNOW YOUR ECONOMICS
1. The subject matter of price theory is
A) Behaviour of industry’s decision making
B) Economic behaviour of the entire country
C) Economic behaviour of individual decision making units
D) Behaviour of all decisionmaking units taken together
2. The Engel curve shows
A) The amount of a commodity that the consumer would purchase per unit of
time at various levels of total income
B) The amount of a commoditythat the consumer would sell at a given level
of income
C) The amount of consumer durables that the consumer would purchase per
unit of time at various levels of total income
D) The amount of consumer non durables that the consumer would purchase
per unit of time at variouslevels of income
3. Hicksian substitution effect refers to
A) The change in the quantity demanded of a commodity resulting from a
change in its price, while holding real income constant by keeping the
consumer on the same indifference curve before and after the price change
B) The change in the quantity supplied of a commodity resulting from a
change in its price, while holding real income constant by keeping the
consumer on the same indifference curve
C) The change in the quantity demanded of a commodity from a change in its
price, while holding absolute income constant by keeping the consumer on
the same indifference curve before and after price change
D) The change in the quantity demanded of a commodity resulting from a
change in its price, while holding income constant by keeping the consumer
on the same indifference curve beforeand after the price change
4. Transitivity assumption in RevealedPreference theorem states that
A) If the consumer is observed to prefer basket A to B, then this consumer will
never prefer B to A
B) The consumer can be induced to purchase any basket of goods
C) If A is preferred to B, and B to C, then A is preferred to C
D) A consumer’s preferences can be inferred
5. The Learning Curve is
A) Positively sloped
B) Negatively sloped and convex to the origin
C) Right angled
D) A horizontal straight line parallel to X axis
6. A market structure which satisfies three conditions of Pareto Optimality
A) Monopolistic Competition B) Perfect Competition
C) Oligopoly D) Monopoly
7. The approach of Revealed Preference Theorem is
A) Psychological
B) Introspective
C) Behaviorist
D) Deductive
8. If specific sales tax is imposed on monopolist output
A) Will maintain the initial equilibrium position and price will not change in
the short run
B) Greater the tax burden to the consumer if market supply is less elastic
C) Shifts the Marginal Cost curve to the left leading to smaller equilibrium
quantity
D) Will not affect the Marginal Cost curve of monopolist
9. A rational consumer will operate in the stage where
A) There is an increase in the productivity of fixed and variable factors
B) Productivity of variable factor diminishes with positive marginal product
C) The quantity of variable factor is more than the quantity of fixed factor
D) There is increasing average returns to the factors of production
10. At higher wage rate, the supply curve of labour is
A) Always positively sloped
B) Forward bending because substitution effect is stronger than income effect
C) Backward bending because substitution effect is weaker than income effect
D) Both substitution effect and income effect are equally stronger
11. The long run supply curve of a constant cost industry is
A) Downward sloping B) Vertical
C) Positively sloped D) Perfectly elastic
12. By joining the points of producer equilibrium we get
A) Expansion Path B) Ridge lines
C) Producer Indifference Curves D) Iso Cost Line
13. From the industries listed below, which is the best available example for perfect
competition?
A) Tea industry B) Telephone industry
C) Food grains D) Automobile industry
14. Marginal Cost always refers to A) Cost of adding one unit
B) Gain in reducing one unit
C) Change in total cost due toaddition or deletion of one unit
D) Increment in cost
15. Cobb Douglas production function is homogenous function of degree
A) Zero B) One
C) Greater than one D) Less than one
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16. A producer of two commodities X and Y using two factors L and K reaches
general equilibrium of production whenever
A) MRTSLKin the production of X is equal to the MRTS LKin the production
of Y
B) MRTS LKin the production of X is less than MRTS LKin the production of
Y
C) MRTS LKin the production of X is greater than MRTS LKin the production
of Y
D) None of these
17. The concept of ‘full cost’ includes
A) Business cost and opportunity cost
B) Opportunity cost and marketing cost
C) Opportunity cost and normal profit
D) Business cost, opportunity cost and normal profit
18. A curve representing different combinations of two inputs that produce the same
level of output is called A) Indifference Curve
B) Isoquant
C) Budget Line
D) Iso Cost Curve
19. Quasi Rent is
A) Equal to the firm’s total profit
B) Greater than the firm’s total profit
C) Less than the firm’s total profit
D) Can not be compared with the firm’s total profit
20. Social Welfare Function shows
A) The various combinations of marginalutilities of two social groups that
give the society the same level of satisfaction or welfare
B) The various combinations of utilities of two individuals that give the
society the same level of satisfaction or welfare
C) The various combinations of sacrifice of all individuals that give the society
an improved level of social welfare
D) None of the above
21. Macro economics does not study
A) Interrelationships between macro variables
B) Performance of the entire economy
C) Determination of the levels of aggregate economic activities
D) Price and output determination of a commodity
22. In macro economic framework, Aggregate Supply refers to
A) Total value of goods producedand supplied in an economy
B) Total value of goods and services supplied in an economy
C) Total value of goods and services produced and supplied in an economy
D) Total value of goods produced in an economy
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23. According to Permanent Income Hypothesis
A) There exists a non proportional relationship between consumption and
permanent income
B) Transitory income is positive for lower income households
C) Consumer behaviour is based on the theory of inter temporal choice
D) Average Propensity to Consume and Marginal Propensity to Consume are
equal for all levels ofdisposable income
24. Given a neo classical aggregate supply schedule, a decrease in autonomous
investment leads to
A) A fall in output, while price level remains the same
B) A fall in both price and level of output
C) An increase in price and level of output
D) A fall in price, but no effect on level of output
25. Static Multiplier assumes
A) That the change in investment and the resulting change in income are
simultaneous
B) That the change in savings and the resulting change in consumption are
simultaneous
C) That the change in investment and the resulting change in consumption are
simultaneous
D) That the technology remains constant
26. Who among the following is a neo Keynesian?
A) Lucas B) Sargent C) Muth D) Mankiw
27. Among the following, which is the best definition of national income?
A) National Income is the money value of all final goods and services
produced in a country during a period of one year
B) National Income is the money value of all final goods produced in a
country during a period of one year
C) National Income is the value of all final goods produced in a country during
a period of one year
D) National Income is the outcome ofall production activities of a nation
valued in terms of money
28. The ratio of the investment to the change in the national income is called
A) Accelerator B) Multiplier
C) Marginal Propensity to Consume D) Marginal Propensity to Invest
29. Nash Equilibrium is one
A) Which every player can improve their pay off given the strategy of the
other players
B) Which some players can improve their pay off given the strategy of the
other players
C) Which none of the players can improve their pay off
D) Which none of the players can improvetheir pay off given the strategy of
the other players.
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30. The following can be considered asan objective of monetary policy
A) Achieve monetary stability
B) Avoid conflicts between the internal and externalinterests of the economy
C) Control government expenditure
D) Create conditions for an efficient utilization of labourand other productive
resources as far as possible
31. GNP deflator is defined as
A) Ratio of nominal GNP in a yearto the real GNP of that year
B) Ratio of GNP in a year to the GDP of that year
C) Ratio of nominal GNP in a year to the nominal GDP of that year
D) Ratio of GNP to the nominal GDP of that year
32. Export surplus is desirable when there is
A) Excess demand B) No demand
C) Deficient demand D) All of the above
33. Money whose intrinsic value is equal to its face value is called
A) Token money B) High Valued money
C) Representative money D) Full Bodied money
34. According to monetary approach to balance of payments, all payment deficits are
the result of
A) Disequilibrium in the balance of payments
B) Floating exchange rate system
C) Excess supply of money in the home country
D) Speculation
35. If C = 100 + 0.75Y, where C = Consumption and Y = Income, then multiplier is
A) 0.6 B) 0.4 C) 2 D) 4
36. If an individual is to receive Rs1100 in oneyear and the market rate of interest is
10 per cent, its present value is
A) 800 B) 900 C) 1100 D) 1000
37. The name of the economist with whom the Real Balance Effect is associated
A) Patinkin B) Keynes C) Arrow D) Friedman
38. Aggregate demand in a two sector model refers to
A) C + I + Y B) C + I
C) C D) C + I – Y +X – M
39. Laffer Curve analysis mainly deals with……………..economics
A) Demand B) Supply
C) Fiscal D) Monetary
40. “Ratchet Effect” is associated to
A) James Duesenberry B) J M Keynes
C) Milton Friedman D) Arrow and Modigilani
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41. The derivative of a constant is
A) 1 B) 0
C) Negative D) Logarithm of that constant
42. The relationship among price elasticity ofdemand, average revenue and marginal
revenue is
A) Average revenue/(average revenue - marginal revenue)
B) Marginal revenue/(marginal revenue - average revenue)
C) Average revenue/(marginal revenue - average revenue)
D) Average revenue - marginal revenue/average revenue
43. If P = a - bq represents the demand equation, then marginal revenue is A) a – 2bq B) a – bq
C) aq – bq2
D) a + 2bq
44. If the utility function U = F(x), the utility is maximum when
A) du/dx = 0 B) d
2
u/dx
2
>0
C) du/dx = 0 and d
2
u/dx
2
<0 D) d
2
u/dx
2
< 0
45. Which of the following is a property of transpose of a matrix?
A) Transpose of the sum of matrices is the difference of the transposes of the
individual matrices
B) Transpose of transpose of a matrix is the original matrix
C) Transpose of a product of matrices is the product of the transpose of the
matrices
D) Transposes of the matrices are not comparable
46. A matrix which has same elements inthe arrangement on both sides of the
diagonal running from north west to south east is called……………….
A) Diagonal Matrix B) Identity Matrix
C) Symmetric Matrix D) Triangular Matrix
47. Definite integral is defined as
A) The value of the integral at the upper limit less its value at the lower limit
B) The value of the integral at the upperlimit plus its value at the lower limit
C) The value of the integral at the lower limit less its value at the upper limit
D) The value of the integral at the upper limit multiplied by its value at the
upper limit
48. Who is more associated with the development of inputoutput analysis?
A) Leontiff B) Danzing
C) Walras D) Pareto
49. In the case of a small sample, the sample size will be
A) Equal to 30 B) Less than 20
C) Less than 29 D) Depends on population
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50. When population under investigation is infinite, we should use A) Sample method
B) Census method
C) Either sample or census method
D) None of these
51. Sampling errors are present only in
A) Complete enumeration survey
B) Sample survey
C) Both census and sample surveys
D) Neither sample or census survey
52. Geographical classification means, classification of data according to
A) Time B) Location
C) Attributes D) Class intervals
53. The geometric mean of two numbers 8 and 18 is
A) 12 B) 13 C) 15 D) 11.07
54. The correlation coefficient r = 0, implies
A) Perfect positive correlation
B) Perfect negative correlation
C) No correlation
D) Insignificant correlation
55. If the regression coefficients are 0.9 and 0.4, the value of the correlation coefficient
is
A) 0.36 B) 0.60 C) 0.81 D) 0.16
56. A bag contains 30 balls numbered from 1 to 30. One ball is drawn at random.
Find the probability that the number of the ball drawn will be a multiple of 5 or
seven
A) 1/3 B) 1/5 C) 1/6 D) 1/2
57. Dr Ambedkar’s contributions to Indian Economic Thought is remarkably found in
A) The problem of the rupee B) Economics of caste
C) Ancient Indian trade D) Deciding foreign exchange rate
58. The growth rate of the Indian economy during 2009-10, according to the Economic
Survey 2009-10
A) 5.3 per cent B) 6.7 per cent
C) 7.8 per cent D) 9.1 per cent
59. In India, M3 is otherwise stated as
A) Reserve money B) Narrow money
C) Broad money D) Plastic money
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60. The Prime Minister’s Employment Generation Programme (PMEGP), has been
launched by merging Rural Employment Generation Programme
and………………
A) National Programme of Mid day meals
B) Swarnjayanti Gram Swarozger Yojana
C) Swarna Jayanti Shahari Rozgar Yojana
D) Prime Minister’s Rozgar Yojana
61. National Rural Employment Guarantee Scheme (NREGS) was launched in the
year
A) 2005 B) 2006 C) 2007 D) 2008
62. According to Population Census of India (2001), how many females are there for
every 1000 males in Kerala?
A) 1056 B) 1057 C) 1058 D) 1059
63. Total number of Revenue Villages in Kerala in 2009
A) 1452 B) 999 C) 991 D) 1642
64. Which Article of the Indian Constitution empowers the appointment of Finance
Commissions?
A) 280 B) 180 C) 279 D) 179
65. The significance of 73
rd
Constitution Amendment (1993)
A) Enactment relating to social welfare
B) Enactment relating to panchayats
C) Enactment relating to anti corruption
D) Enactment relating to women empowerment
66. “Current Daily Status” is a concept used in measuring
A) Daily average stock of money supply
B) Daily average stock of Foreign Exchange Reserves
C) Rate of inflation
D) Employment and unemployment
67. The main objective of Bharat Nirman (2005) programme is
A) Developing skill oriented youth
B) Providing basic amenities in rural areas
C) Providing sanitation facilities in rural and urban areas
D) Encouraging the birth of girl child
68. The Unorganised Worker’s Social Security Act was passed in the year
A) 2008 B) 2009
C) 2007 D) 2006
69. The basic principles of decentralisation of power in Kerala State was framed by
A) Kerala Panchayat Raj Act B) Sen Committee
C) ADB guidelines D) World Bank guidelines
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70. The Head Quarters of Small Industries Development Bank of India is located at
A) Mumbai B) New Delhi
C) Lucknow D) Chennai
71. The time period of the 11
th
Five Year Plan
A) 2009-14 B) 2008-13 C) 2006-11 D) 2007-12
72. In India, Five Year Plans are approved by the
A) Planning Commission
B) Parliament
C) National Development Council
D) President of India
73. According to the neo classical model, the rate of economic growth depends on
A) Capital Stock
B) Capital Stock and Labour Supply
C) Capital Stock, Labour Supply and Technological Progress
D) Technological progress
74. The new growth theory assumes technology as
A) Endogenous B) Exogenous
C) Constant D) Neutral
75. One of the major contributions of ArthurLewis to the theoryof economic growth
is
A) The concept of full employment
B) The concept of employment
C) The concept of frictional unemployment
D) The concept of disguised unemployment
76. The “Critical Minimum Effort” theory of development was advanced by
A) Nurkse B) Nelson
C) Leibenstein D) Kaldor
77. Ricardian analysis of rent is based on the following principle
A) Law of diminishing returns B) Comparative cost advantage
C) Fertility of the land D) Law of increasing returns
78. Which committee looked into the problem of tax evasion and suggested measures
(1971)
A) Tyagi Committee B) Boothalingam Committee
C) Jha Committee D) Wanchoo Committee
79. The statement “A country is poor because it is poor” is associated with the name of
A) Nrukse B) Hicks C) Smith D) Myrdal
80. Stockholm Conference on Human Environment was held in the year
A) 1987 B) 1972 C) 1992 D) 1991
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81. The environmental Kuznets Curve Hypothesis proposes that
A) There is an inverted U shape relation between quality of environment and
per capita income
B) There is a linear relation between quality of environment and per capita
income
C) There is a negative relation between quality of environment and per capita
income
D) There is a L shape relation between quality of environment and per capita
income
82. Among the following, which term is more associated to environmental issues?
A) Public utilities B) Shadow price
C) Gross profit D) Market price
83. Among the following, which is the best example for international public good?
A) Western Ghats B) River Nile
C) Silent Valley D) Biological Diversity
84. Among the following, which agency is moreassociated to environmental issues?
A) UNO B) UNCTAD C) UNDP D) ADB
85. National Environment Policy was declared in the year
A) 2005 B) 2004 C) 2006 D) 2007
86. According to Harrod, the equilibrium between G and Gwis
A) Stable B) Knife edge
C) Under employment D) Fluctuating
87. According to Kaldor, when savings out of profit is less than savings out of wages
A) Prices will increase B) Cumulative fall in prices
C) Increase in consumption D) Increase in production
88. The person behind the concept “Industrial Reserve Army”
A) Adam Smith B) David Ricardo
C) Malthus D) Karl Marx
89. The rate of exchange can be defined as
A) The rate at which the currency of one country is converted into US Dollars
B) The rate at which Indian rupee is converted into any other currency
C) The rate at which one currency is converted into another currency
D) The rate declared by the Reserve Bankof India for the conversion of Indian
rupee into US Dollars
90. Under fixed exchange system, the rate of exchange is determined by
A) New York Stock Exchange B) Central Bank of a country
C) Planning Commission D) Ministry of Finance
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91. The account which shows all transactions to trade in goods, services and unilateral
transfers is called
A) Capital Account B) Current Account
C) Revenue Account D) None of these
92. Find odd man out
A) Value of shipping services B) Value of marine products exported
C) Value of tea exported D) Value of pepper exported
93. If the value of the currency increases interms of some other foreign currency by
the market mechanism, it is called
A) Devaluation B) Appreciation
C) Depreciation D) Dumping
94. Foreign Direct Investment (FDI) comes under A) Current Account
B) Official Reserve Account
C) Capital Account
D) Revenue Account
95. Among the following which is the best advantage of international trade?
A) Benefit of price stability
B) Benefit of demand and supply equilibrium for commodities
C) Benefit of achieving equilibrium in foreign exchange reserves
D) Benefit of specialization
96. Ricardian Theory of Comparative Advantage suggests that trade between two
countries is desirable
A) If one has absolute advantage inthe production of both the commodities
and the other absolute disadvantage in production of both the commodities
B) If one has absolute advantage in the production of at least one commodity
and the other absolute disadvantage in production of both the commodities
C) If one has absolute advantage inthe production of both the commodities
and the other absolute disadvantage in production of at least one
commodity
D) If one has comparative advantage in the production of both the
commodities, with out considering the status of the other country
97. Terms of Trade can be defined as
A) Quantity of domestic goods that mustbe given in exchange for one unit of
imported goods
B) Quantity of goods to be exported tobalance the deficit in the foreign
exchange reserves with respect to a country
C) Quantity of goods to be imported in exchange of one unit of exported goods
D) Ratio between goods exported and goods imported in a given year
11
98. Forward market refers to
A) Foreign exchange deals for sale and purchases of foreign currency at some
future date
B) Foreign exchange deals for sale of foreign currency at some future date
C) Foreign exchange deals for purchase of foreign currency at some future
date
D) Foreign exchange deals for sale and purchase for foreign currency at spot
99. Remittances of the nationals working aboard come under
A) Current Account B) Capital Account
C) Official Reserve Account D) Balance of Trade Account
100. Net Factor Income from abroad is defined as
A) Total income from abroad – factor income
B) Factor income from abroad – factor income
C) Factor income from abroad – personal income
D) Total income from abroad – personal income
101. World Trade Organisation (WTO) came into force on
A) 1-1-1995 B) 1-1-1994 C) 1-1-1996 D) 1-1-1991
102. Doha Agreement is associated to
A) Industry B) Agriculture C) Trade D) Banking
103. Which agency is more associated to world trade?
A) ADB B) UNCTAD C) UNO D) EEC
104. “The Third World War will start from………………….”(Paul Roberts)
A) Struggle for food
B) Struggle for water
C) Struggle for gender empowerment
D) Struggle for sanitation facilities
105. Who is more associated tooptimality in allocations?
A) Wicksell B) Pareto
C) Tiebout D) Bowen
106. Who advocated expenditure taxation?
A) Adam Smith
B) Raja J Chelliah
C) Indirect Tax Enquiry Committee
D) Nicholas Kaldor
107. Which of the following is a local tax?
A) Turnover tax B) Advertisement tax
C) Sales tax D) Capital gains tax
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108. A standard framework introduced in 1969 for disbursing plan assistance to the
States
A) Kelkar Formula B) Gadgil Formula
C) Population area ratio D) Density area ratio
109. Treasury bills are instruments in
A) Capital market B) Money market
C) Goods market D) Foreign Exchange market
110. Value Added Tax (VAT) is
A) Tax on total value of the goods sold
B) Tax on the value added by the last seller
C) Tax on the value added by all the intermediaries
D) None of the above
111. Pick odd man out
A) Fiscal Deficit B) Revenue Deficit
C) Budget Deficit D) Deficit Financing
112. Expenditure that does not create any asset is called
A) Revenue Expenditure B) Capital Expenditure
C) Plan Expenditure D) Non Plan Expenditure
113. Property of persons who die without heirs is called
A) Forfeiture B) Special assessment
C) Escheats D) Gifts
114. Who was the Chairman of the Tax Reform Committee, 1991?
A) Rangarajan B) Talwar
C) Raja Chelliah D) Narashimham
115. Expenditure tax was abolished in India in the year
A) 1962 B) 1963
C) 1964 D) 1965
116. Excess of fiscal deficit over interest payments is
A) Monetised deficit B) Budget deficit
C) Primary deficit D) Secondary deficit
117. Penalty imposed by the court for breaking of contract is called
A) Escheats B) Forfeiture
C) Fine D) None of these
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118. Among the following, which is the best explanation for disinvestment? A) Selling of shares
B) Selling of shares of government in the public enterprises
C) Selling of shares of government in the public enterprises to the private
companies
D) Selling of shares of government inthe public enterprises to the Multi
National Companies
119. Spill over effects refer to
A) Direct effects which flow fromthe production to the other parties
B) Economic effects due to externalities
C) Economic effects which flow from the production or use of the good to
final users only
D) Effects which flow from the production or use of the good to final users
only
120. Who coined the term “Merit goods”?
A) Dalton B) Musgrave
C) Marshall D) Lerner
………………….
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1. The subject matter of price theory is
A) Behaviour of industry’s decision making
B) Economic behaviour of the entire country
C) Economic behaviour of individual decision making units
D) Behaviour of all decisionmaking units taken together
2. The Engel curve shows
A) The amount of a commodity that the consumer would purchase per unit of
time at various levels of total income
B) The amount of a commoditythat the consumer would sell at a given level
of income
C) The amount of consumer durables that the consumer would purchase per
unit of time at various levels of total income
D) The amount of consumer non durables that the consumer would purchase
per unit of time at variouslevels of income
3. Hicksian substitution effect refers to
A) The change in the quantity demanded of a commodity resulting from a
change in its price, while holding real income constant by keeping the
consumer on the same indifference curve before and after the price change
B) The change in the quantity supplied of a commodity resulting from a
change in its price, while holding real income constant by keeping the
consumer on the same indifference curve
C) The change in the quantity demanded of a commodity from a change in its
price, while holding absolute income constant by keeping the consumer on
the same indifference curve before and after price change
D) The change in the quantity demanded of a commodity resulting from a
change in its price, while holding income constant by keeping the consumer
on the same indifference curve beforeand after the price change
4. Transitivity assumption in RevealedPreference theorem states that
A) If the consumer is observed to prefer basket A to B, then this consumer will
never prefer B to A
B) The consumer can be induced to purchase any basket of goods
C) If A is preferred to B, and B to C, then A is preferred to C
D) A consumer’s preferences can be inferred
5. The Learning Curve is
A) Positively sloped
B) Negatively sloped and convex to the origin
C) Right angled
D) A horizontal straight line parallel to X axis
6. A market structure which satisfies three conditions of Pareto Optimality
A) Monopolistic Competition B) Perfect Competition
C) Oligopoly D) Monopoly
7. The approach of Revealed Preference Theorem is
A) Psychological
B) Introspective
C) Behaviorist
D) Deductive
8. If specific sales tax is imposed on monopolist output
A) Will maintain the initial equilibrium position and price will not change in
the short run
B) Greater the tax burden to the consumer if market supply is less elastic
C) Shifts the Marginal Cost curve to the left leading to smaller equilibrium
quantity
D) Will not affect the Marginal Cost curve of monopolist
9. A rational consumer will operate in the stage where
A) There is an increase in the productivity of fixed and variable factors
B) Productivity of variable factor diminishes with positive marginal product
C) The quantity of variable factor is more than the quantity of fixed factor
D) There is increasing average returns to the factors of production
10. At higher wage rate, the supply curve of labour is
A) Always positively sloped
B) Forward bending because substitution effect is stronger than income effect
C) Backward bending because substitution effect is weaker than income effect
D) Both substitution effect and income effect are equally stronger
11. The long run supply curve of a constant cost industry is
A) Downward sloping B) Vertical
C) Positively sloped D) Perfectly elastic
12. By joining the points of producer equilibrium we get
A) Expansion Path B) Ridge lines
C) Producer Indifference Curves D) Iso Cost Line
13. From the industries listed below, which is the best available example for perfect
competition?
A) Tea industry B) Telephone industry
C) Food grains D) Automobile industry
14. Marginal Cost always refers to A) Cost of adding one unit
B) Gain in reducing one unit
C) Change in total cost due toaddition or deletion of one unit
D) Increment in cost
15. Cobb Douglas production function is homogenous function of degree
A) Zero B) One
C) Greater than one D) Less than one
2
16. A producer of two commodities X and Y using two factors L and K reaches
general equilibrium of production whenever
A) MRTSLKin the production of X is equal to the MRTS LKin the production
of Y
B) MRTS LKin the production of X is less than MRTS LKin the production of
Y
C) MRTS LKin the production of X is greater than MRTS LKin the production
of Y
D) None of these
17. The concept of ‘full cost’ includes
A) Business cost and opportunity cost
B) Opportunity cost and marketing cost
C) Opportunity cost and normal profit
D) Business cost, opportunity cost and normal profit
18. A curve representing different combinations of two inputs that produce the same
level of output is called A) Indifference Curve
B) Isoquant
C) Budget Line
D) Iso Cost Curve
19. Quasi Rent is
A) Equal to the firm’s total profit
B) Greater than the firm’s total profit
C) Less than the firm’s total profit
D) Can not be compared with the firm’s total profit
20. Social Welfare Function shows
A) The various combinations of marginalutilities of two social groups that
give the society the same level of satisfaction or welfare
B) The various combinations of utilities of two individuals that give the
society the same level of satisfaction or welfare
C) The various combinations of sacrifice of all individuals that give the society
an improved level of social welfare
D) None of the above
21. Macro economics does not study
A) Interrelationships between macro variables
B) Performance of the entire economy
C) Determination of the levels of aggregate economic activities
D) Price and output determination of a commodity
22. In macro economic framework, Aggregate Supply refers to
A) Total value of goods producedand supplied in an economy
B) Total value of goods and services supplied in an economy
C) Total value of goods and services produced and supplied in an economy
D) Total value of goods produced in an economy
3
23. According to Permanent Income Hypothesis
A) There exists a non proportional relationship between consumption and
permanent income
B) Transitory income is positive for lower income households
C) Consumer behaviour is based on the theory of inter temporal choice
D) Average Propensity to Consume and Marginal Propensity to Consume are
equal for all levels ofdisposable income
24. Given a neo classical aggregate supply schedule, a decrease in autonomous
investment leads to
A) A fall in output, while price level remains the same
B) A fall in both price and level of output
C) An increase in price and level of output
D) A fall in price, but no effect on level of output
25. Static Multiplier assumes
A) That the change in investment and the resulting change in income are
simultaneous
B) That the change in savings and the resulting change in consumption are
simultaneous
C) That the change in investment and the resulting change in consumption are
simultaneous
D) That the technology remains constant
26. Who among the following is a neo Keynesian?
A) Lucas B) Sargent C) Muth D) Mankiw
27. Among the following, which is the best definition of national income?
A) National Income is the money value of all final goods and services
produced in a country during a period of one year
B) National Income is the money value of all final goods produced in a
country during a period of one year
C) National Income is the value of all final goods produced in a country during
a period of one year
D) National Income is the outcome ofall production activities of a nation
valued in terms of money
28. The ratio of the investment to the change in the national income is called
A) Accelerator B) Multiplier
C) Marginal Propensity to Consume D) Marginal Propensity to Invest
29. Nash Equilibrium is one
A) Which every player can improve their pay off given the strategy of the
other players
B) Which some players can improve their pay off given the strategy of the
other players
C) Which none of the players can improve their pay off
D) Which none of the players can improvetheir pay off given the strategy of
the other players.
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30. The following can be considered asan objective of monetary policy
A) Achieve monetary stability
B) Avoid conflicts between the internal and externalinterests of the economy
C) Control government expenditure
D) Create conditions for an efficient utilization of labourand other productive
resources as far as possible
31. GNP deflator is defined as
A) Ratio of nominal GNP in a yearto the real GNP of that year
B) Ratio of GNP in a year to the GDP of that year
C) Ratio of nominal GNP in a year to the nominal GDP of that year
D) Ratio of GNP to the nominal GDP of that year
32. Export surplus is desirable when there is
A) Excess demand B) No demand
C) Deficient demand D) All of the above
33. Money whose intrinsic value is equal to its face value is called
A) Token money B) High Valued money
C) Representative money D) Full Bodied money
34. According to monetary approach to balance of payments, all payment deficits are
the result of
A) Disequilibrium in the balance of payments
B) Floating exchange rate system
C) Excess supply of money in the home country
D) Speculation
35. If C = 100 + 0.75Y, where C = Consumption and Y = Income, then multiplier is
A) 0.6 B) 0.4 C) 2 D) 4
36. If an individual is to receive Rs1100 in oneyear and the market rate of interest is
10 per cent, its present value is
A) 800 B) 900 C) 1100 D) 1000
37. The name of the economist with whom the Real Balance Effect is associated
A) Patinkin B) Keynes C) Arrow D) Friedman
38. Aggregate demand in a two sector model refers to
A) C + I + Y B) C + I
C) C D) C + I – Y +X – M
39. Laffer Curve analysis mainly deals with……………..economics
A) Demand B) Supply
C) Fiscal D) Monetary
40. “Ratchet Effect” is associated to
A) James Duesenberry B) J M Keynes
C) Milton Friedman D) Arrow and Modigilani
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41. The derivative of a constant is
A) 1 B) 0
C) Negative D) Logarithm of that constant
42. The relationship among price elasticity ofdemand, average revenue and marginal
revenue is
A) Average revenue/(average revenue - marginal revenue)
B) Marginal revenue/(marginal revenue - average revenue)
C) Average revenue/(marginal revenue - average revenue)
D) Average revenue - marginal revenue/average revenue
43. If P = a - bq represents the demand equation, then marginal revenue is A) a – 2bq B) a – bq
C) aq – bq2
D) a + 2bq
44. If the utility function U = F(x), the utility is maximum when
A) du/dx = 0 B) d
2
u/dx
2
>0
C) du/dx = 0 and d
2
u/dx
2
<0 D) d
2
u/dx
2
< 0
45. Which of the following is a property of transpose of a matrix?
A) Transpose of the sum of matrices is the difference of the transposes of the
individual matrices
B) Transpose of transpose of a matrix is the original matrix
C) Transpose of a product of matrices is the product of the transpose of the
matrices
D) Transposes of the matrices are not comparable
46. A matrix which has same elements inthe arrangement on both sides of the
diagonal running from north west to south east is called……………….
A) Diagonal Matrix B) Identity Matrix
C) Symmetric Matrix D) Triangular Matrix
47. Definite integral is defined as
A) The value of the integral at the upper limit less its value at the lower limit
B) The value of the integral at the upperlimit plus its value at the lower limit
C) The value of the integral at the lower limit less its value at the upper limit
D) The value of the integral at the upper limit multiplied by its value at the
upper limit
48. Who is more associated with the development of inputoutput analysis?
A) Leontiff B) Danzing
C) Walras D) Pareto
49. In the case of a small sample, the sample size will be
A) Equal to 30 B) Less than 20
C) Less than 29 D) Depends on population
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50. When population under investigation is infinite, we should use A) Sample method
B) Census method
C) Either sample or census method
D) None of these
51. Sampling errors are present only in
A) Complete enumeration survey
B) Sample survey
C) Both census and sample surveys
D) Neither sample or census survey
52. Geographical classification means, classification of data according to
A) Time B) Location
C) Attributes D) Class intervals
53. The geometric mean of two numbers 8 and 18 is
A) 12 B) 13 C) 15 D) 11.07
54. The correlation coefficient r = 0, implies
A) Perfect positive correlation
B) Perfect negative correlation
C) No correlation
D) Insignificant correlation
55. If the regression coefficients are 0.9 and 0.4, the value of the correlation coefficient
is
A) 0.36 B) 0.60 C) 0.81 D) 0.16
56. A bag contains 30 balls numbered from 1 to 30. One ball is drawn at random.
Find the probability that the number of the ball drawn will be a multiple of 5 or
seven
A) 1/3 B) 1/5 C) 1/6 D) 1/2
57. Dr Ambedkar’s contributions to Indian Economic Thought is remarkably found in
A) The problem of the rupee B) Economics of caste
C) Ancient Indian trade D) Deciding foreign exchange rate
58. The growth rate of the Indian economy during 2009-10, according to the Economic
Survey 2009-10
A) 5.3 per cent B) 6.7 per cent
C) 7.8 per cent D) 9.1 per cent
59. In India, M3 is otherwise stated as
A) Reserve money B) Narrow money
C) Broad money D) Plastic money
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60. The Prime Minister’s Employment Generation Programme (PMEGP), has been
launched by merging Rural Employment Generation Programme
and………………
A) National Programme of Mid day meals
B) Swarnjayanti Gram Swarozger Yojana
C) Swarna Jayanti Shahari Rozgar Yojana
D) Prime Minister’s Rozgar Yojana
61. National Rural Employment Guarantee Scheme (NREGS) was launched in the
year
A) 2005 B) 2006 C) 2007 D) 2008
62. According to Population Census of India (2001), how many females are there for
every 1000 males in Kerala?
A) 1056 B) 1057 C) 1058 D) 1059
63. Total number of Revenue Villages in Kerala in 2009
A) 1452 B) 999 C) 991 D) 1642
64. Which Article of the Indian Constitution empowers the appointment of Finance
Commissions?
A) 280 B) 180 C) 279 D) 179
65. The significance of 73
rd
Constitution Amendment (1993)
A) Enactment relating to social welfare
B) Enactment relating to panchayats
C) Enactment relating to anti corruption
D) Enactment relating to women empowerment
66. “Current Daily Status” is a concept used in measuring
A) Daily average stock of money supply
B) Daily average stock of Foreign Exchange Reserves
C) Rate of inflation
D) Employment and unemployment
67. The main objective of Bharat Nirman (2005) programme is
A) Developing skill oriented youth
B) Providing basic amenities in rural areas
C) Providing sanitation facilities in rural and urban areas
D) Encouraging the birth of girl child
68. The Unorganised Worker’s Social Security Act was passed in the year
A) 2008 B) 2009
C) 2007 D) 2006
69. The basic principles of decentralisation of power in Kerala State was framed by
A) Kerala Panchayat Raj Act B) Sen Committee
C) ADB guidelines D) World Bank guidelines
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70. The Head Quarters of Small Industries Development Bank of India is located at
A) Mumbai B) New Delhi
C) Lucknow D) Chennai
71. The time period of the 11
th
Five Year Plan
A) 2009-14 B) 2008-13 C) 2006-11 D) 2007-12
72. In India, Five Year Plans are approved by the
A) Planning Commission
B) Parliament
C) National Development Council
D) President of India
73. According to the neo classical model, the rate of economic growth depends on
A) Capital Stock
B) Capital Stock and Labour Supply
C) Capital Stock, Labour Supply and Technological Progress
D) Technological progress
74. The new growth theory assumes technology as
A) Endogenous B) Exogenous
C) Constant D) Neutral
75. One of the major contributions of ArthurLewis to the theoryof economic growth
is
A) The concept of full employment
B) The concept of employment
C) The concept of frictional unemployment
D) The concept of disguised unemployment
76. The “Critical Minimum Effort” theory of development was advanced by
A) Nurkse B) Nelson
C) Leibenstein D) Kaldor
77. Ricardian analysis of rent is based on the following principle
A) Law of diminishing returns B) Comparative cost advantage
C) Fertility of the land D) Law of increasing returns
78. Which committee looked into the problem of tax evasion and suggested measures
(1971)
A) Tyagi Committee B) Boothalingam Committee
C) Jha Committee D) Wanchoo Committee
79. The statement “A country is poor because it is poor” is associated with the name of
A) Nrukse B) Hicks C) Smith D) Myrdal
80. Stockholm Conference on Human Environment was held in the year
A) 1987 B) 1972 C) 1992 D) 1991
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81. The environmental Kuznets Curve Hypothesis proposes that
A) There is an inverted U shape relation between quality of environment and
per capita income
B) There is a linear relation between quality of environment and per capita
income
C) There is a negative relation between quality of environment and per capita
income
D) There is a L shape relation between quality of environment and per capita
income
82. Among the following, which term is more associated to environmental issues?
A) Public utilities B) Shadow price
C) Gross profit D) Market price
83. Among the following, which is the best example for international public good?
A) Western Ghats B) River Nile
C) Silent Valley D) Biological Diversity
84. Among the following, which agency is moreassociated to environmental issues?
A) UNO B) UNCTAD C) UNDP D) ADB
85. National Environment Policy was declared in the year
A) 2005 B) 2004 C) 2006 D) 2007
86. According to Harrod, the equilibrium between G and Gwis
A) Stable B) Knife edge
C) Under employment D) Fluctuating
87. According to Kaldor, when savings out of profit is less than savings out of wages
A) Prices will increase B) Cumulative fall in prices
C) Increase in consumption D) Increase in production
88. The person behind the concept “Industrial Reserve Army”
A) Adam Smith B) David Ricardo
C) Malthus D) Karl Marx
89. The rate of exchange can be defined as
A) The rate at which the currency of one country is converted into US Dollars
B) The rate at which Indian rupee is converted into any other currency
C) The rate at which one currency is converted into another currency
D) The rate declared by the Reserve Bankof India for the conversion of Indian
rupee into US Dollars
90. Under fixed exchange system, the rate of exchange is determined by
A) New York Stock Exchange B) Central Bank of a country
C) Planning Commission D) Ministry of Finance
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91. The account which shows all transactions to trade in goods, services and unilateral
transfers is called
A) Capital Account B) Current Account
C) Revenue Account D) None of these
92. Find odd man out
A) Value of shipping services B) Value of marine products exported
C) Value of tea exported D) Value of pepper exported
93. If the value of the currency increases interms of some other foreign currency by
the market mechanism, it is called
A) Devaluation B) Appreciation
C) Depreciation D) Dumping
94. Foreign Direct Investment (FDI) comes under A) Current Account
B) Official Reserve Account
C) Capital Account
D) Revenue Account
95. Among the following which is the best advantage of international trade?
A) Benefit of price stability
B) Benefit of demand and supply equilibrium for commodities
C) Benefit of achieving equilibrium in foreign exchange reserves
D) Benefit of specialization
96. Ricardian Theory of Comparative Advantage suggests that trade between two
countries is desirable
A) If one has absolute advantage inthe production of both the commodities
and the other absolute disadvantage in production of both the commodities
B) If one has absolute advantage in the production of at least one commodity
and the other absolute disadvantage in production of both the commodities
C) If one has absolute advantage inthe production of both the commodities
and the other absolute disadvantage in production of at least one
commodity
D) If one has comparative advantage in the production of both the
commodities, with out considering the status of the other country
97. Terms of Trade can be defined as
A) Quantity of domestic goods that mustbe given in exchange for one unit of
imported goods
B) Quantity of goods to be exported tobalance the deficit in the foreign
exchange reserves with respect to a country
C) Quantity of goods to be imported in exchange of one unit of exported goods
D) Ratio between goods exported and goods imported in a given year
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98. Forward market refers to
A) Foreign exchange deals for sale and purchases of foreign currency at some
future date
B) Foreign exchange deals for sale of foreign currency at some future date
C) Foreign exchange deals for purchase of foreign currency at some future
date
D) Foreign exchange deals for sale and purchase for foreign currency at spot
99. Remittances of the nationals working aboard come under
A) Current Account B) Capital Account
C) Official Reserve Account D) Balance of Trade Account
100. Net Factor Income from abroad is defined as
A) Total income from abroad – factor income
B) Factor income from abroad – factor income
C) Factor income from abroad – personal income
D) Total income from abroad – personal income
101. World Trade Organisation (WTO) came into force on
A) 1-1-1995 B) 1-1-1994 C) 1-1-1996 D) 1-1-1991
102. Doha Agreement is associated to
A) Industry B) Agriculture C) Trade D) Banking
103. Which agency is more associated to world trade?
A) ADB B) UNCTAD C) UNO D) EEC
104. “The Third World War will start from………………….”(Paul Roberts)
A) Struggle for food
B) Struggle for water
C) Struggle for gender empowerment
D) Struggle for sanitation facilities
105. Who is more associated tooptimality in allocations?
A) Wicksell B) Pareto
C) Tiebout D) Bowen
106. Who advocated expenditure taxation?
A) Adam Smith
B) Raja J Chelliah
C) Indirect Tax Enquiry Committee
D) Nicholas Kaldor
107. Which of the following is a local tax?
A) Turnover tax B) Advertisement tax
C) Sales tax D) Capital gains tax
12
108. A standard framework introduced in 1969 for disbursing plan assistance to the
States
A) Kelkar Formula B) Gadgil Formula
C) Population area ratio D) Density area ratio
109. Treasury bills are instruments in
A) Capital market B) Money market
C) Goods market D) Foreign Exchange market
110. Value Added Tax (VAT) is
A) Tax on total value of the goods sold
B) Tax on the value added by the last seller
C) Tax on the value added by all the intermediaries
D) None of the above
111. Pick odd man out
A) Fiscal Deficit B) Revenue Deficit
C) Budget Deficit D) Deficit Financing
112. Expenditure that does not create any asset is called
A) Revenue Expenditure B) Capital Expenditure
C) Plan Expenditure D) Non Plan Expenditure
113. Property of persons who die without heirs is called
A) Forfeiture B) Special assessment
C) Escheats D) Gifts
114. Who was the Chairman of the Tax Reform Committee, 1991?
A) Rangarajan B) Talwar
C) Raja Chelliah D) Narashimham
115. Expenditure tax was abolished in India in the year
A) 1962 B) 1963
C) 1964 D) 1965
116. Excess of fiscal deficit over interest payments is
A) Monetised deficit B) Budget deficit
C) Primary deficit D) Secondary deficit
117. Penalty imposed by the court for breaking of contract is called
A) Escheats B) Forfeiture
C) Fine D) None of these
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118. Among the following, which is the best explanation for disinvestment? A) Selling of shares
B) Selling of shares of government in the public enterprises
C) Selling of shares of government in the public enterprises to the private
companies
D) Selling of shares of government inthe public enterprises to the Multi
National Companies
119. Spill over effects refer to
A) Direct effects which flow fromthe production to the other parties
B) Economic effects due to externalities
C) Economic effects which flow from the production or use of the good to
final users only
D) Effects which flow from the production or use of the good to final users
only
120. Who coined the term “Merit goods”?
A) Dalton B) Musgrave
C) Marshall D) Lerner
………………….
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