Tuesday, November 15, 2011
ECONOMICS-Reading Comprehension---Try...
Read the passage given below and answer questions from 1 to 4 on your understanding of the passage:
The more difficult task of ensuring global economic stability was assigned to the IMF. Those who convened Bretton Woods had the global depression of the 1930's very much on their minds. Almost three quarters of a century ago, capitalism faced the most severe crisis to date. The Great Depression enveloped the whole world and led to unprecedented increases in unemployment. At the worst point, a quarter of America's workforce was unemployed. The British economist John Maynard Keynes, who would later be a key participant at Bretton Woods, put forward a simple explanation, and a corresponding simple set of prescriptions; lack of sufficient aggregate demand explained economic downturns; government policies could help stimulate aggregate demand. In cases where monetary policy is ineffective, governments could rely on fiscal policies, either by increasing expenditures or cutting taxes. While the models underlying Keynes' analysis have subsequently been criticised and refined, bringing a deeper understanding of why market forces do not work quickly to adjust the economy to full employment, the basic lessons remain valid.
1. The IMF was assigned:
(A) The task of accelerating economic growth of the world
(B) The task of controlling inflation in the world economy
(C) The task of ensuring economic stability in the world economy
(D) The task of removing imbalances from the U.S.A.
2. During the Great Depression :
(A) Unemployment rate in the World was 25%
(B) Unemployment rate in England was 20%
(C) Unemployment rate in the U.S.A. was 25%
(D) Unemployment rate in India was 20%
3. According to Keynes, the cause for the unprecedented global depression of the 1930's
was:
(A) High interest rate in the USA.
(B) Low interest rate in the UK.
(C) Break down of the gold standard
(D) Lack of sufficient aggregate demand
4. Keynes' prescription to fight global depression was that:
(A) The government should pursue active monetary policy
(B) The government should pursue a combination of fiscal policy and monetary policy
(C) The government should pursue fiscal policy where monetary policy is in effective
(D) The government should have a policy of balanced budget
answers: 1.C, 2. C, 3. D, 4. C
The more difficult task of ensuring global economic stability was assigned to the IMF. Those who convened Bretton Woods had the global depression of the 1930's very much on their minds. Almost three quarters of a century ago, capitalism faced the most severe crisis to date. The Great Depression enveloped the whole world and led to unprecedented increases in unemployment. At the worst point, a quarter of America's workforce was unemployed. The British economist John Maynard Keynes, who would later be a key participant at Bretton Woods, put forward a simple explanation, and a corresponding simple set of prescriptions; lack of sufficient aggregate demand explained economic downturns; government policies could help stimulate aggregate demand. In cases where monetary policy is ineffective, governments could rely on fiscal policies, either by increasing expenditures or cutting taxes. While the models underlying Keynes' analysis have subsequently been criticised and refined, bringing a deeper understanding of why market forces do not work quickly to adjust the economy to full employment, the basic lessons remain valid.
1. The IMF was assigned:
(A) The task of accelerating economic growth of the world
(B) The task of controlling inflation in the world economy
(C) The task of ensuring economic stability in the world economy
(D) The task of removing imbalances from the U.S.A.
2. During the Great Depression :
(A) Unemployment rate in the World was 25%
(B) Unemployment rate in England was 20%
(C) Unemployment rate in the U.S.A. was 25%
(D) Unemployment rate in India was 20%
3. According to Keynes, the cause for the unprecedented global depression of the 1930's
was:
(A) High interest rate in the USA.
(B) Low interest rate in the UK.
(C) Break down of the gold standard
(D) Lack of sufficient aggregate demand
4. Keynes' prescription to fight global depression was that:
(A) The government should pursue active monetary policy
(B) The government should pursue a combination of fiscal policy and monetary policy
(C) The government should pursue fiscal policy where monetary policy is in effective
(D) The government should have a policy of balanced budget
answers: 1.C, 2. C, 3. D, 4. C
Monday, November 14, 2011
ECONOMICS---UGC NET--
1.The difference between total revenue and total expenditure is called :
(A) Capital deficit
(B) Revenue deficit
(C) Fiscal deficit
(D) Budgetary deficit
2. Borrowings from foreigners are known as :
(A) Export of goods
(B) Unrequited receipts
(C) Capital receipts
(D) Current receipts
3. Quantitative restrictions on imports by a country will lead to :
(A) Decreased demand for imported products
(B) Increased demand for imported products
(C) Increased supply of imported products
(D) Decreased supply of imported products
4. As per the UNDP's Global Human Development Report 2007, India's relative rankingout of 177 countries in respect of HDI was :
(A) 123
(B) 131
(C) 128
(D) 125
Consider the following statements and select the correct answer from the codes given below for questions 5 to 10(Assertion and Reasoning type item).
5. Assertion (A) : Under oligopoly, all firms are aware of their inter-dependence.Reason (R) : Personal rivalries do not exist among firms under oligopoly.
(A) Both (A) and (R) are false
(B) Both (A) and (R) are true but (R) is not the explanation of (A)
(C) (A) is true, but (R) is false
(D) (A) is false, but (R) is true
6. Assertion (A) : Giffen goods have a positively sloped demand curve.
Reason (R) : The positive substitution effect in their case is more than offset by negative income effect.
(A) Both (A) and (R) are true and (R) is the correct explanation of (A)
(B) (A) is true, but (R) is false
(C) Both (A) and (R) are false
(D) Both (A) and (R) are true, but (R) is not the correct explanation of (A)
7. Assertion (A) : According to Hicks, trade cycle occurs due to the interaction between
multiplier, and accelerator. Reason (R) : In Hicksian business cycle theory, accelerator is impotent in the depression phase.
(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) Both (A) and (R) are false
(D) (A) is true, but (R) is false
8. Assertion (A) : Duesenberry hypothesised that consumption - income relationship is
irreversible.
Reason (R) : Consumption depends not only on current income but also on previous peak income.
(A) Both (A) and (R) are true, but (R) is not the correct explanation of (A)
(B) Both (A) and (R) are true, and (R) is the correct explanation of (A)
(C) (A) is true, but (R) is false
(D) Both (A) and (R) are false
9. Assertion (A) : Backwash effects imply an unfavourable situation arising in
underdeveloped countries. Reason (R) : Undue emphasis on exports of raw-materials at the expense of the growth of domestic manufacturing.
(A) (A) is true, but (R) is false
(B) Both (A) and (R) are false
(C) Both (A) and (R) are true and (R) is the correct explanation of (A)
(D) Both (A) and (R) are true, but (R) is not the correct explanation of (A)
10. Assertion (A) : Low levels of labour productivity exist in underdeveloped countries.Reason (R) : It is due to the lack of physical capital.
(A) Both (A) and (R) are false
(B) (A) is true, but (R) is false
(C) Both (A) and (R) are true and (R) is the correct explanation of (A)
(D) Both (A) and (R) are true, but (R) is not the correct explanation of (A)
answers are:
1.Budgetary deficit
2. Capital receipts
3. Decreased supply of imported products
4. 128
5. (A) is true, but (R) is false
6.Both (A) and (R) are true and (R) is the correct explanation of (A)
7.Both (A) and (R) are true, but (R) is not the correct explanation of (A)
8. Both (A) and (R) are true, but (R) is not the correct explanation of (A)
9.Both (A) and (R) are true and (R) is the correct explanation of (A)
10. (A) is true, but (R) is false.
(A) Capital deficit
(B) Revenue deficit
(C) Fiscal deficit
(D) Budgetary deficit
2. Borrowings from foreigners are known as :
(A) Export of goods
(B) Unrequited receipts
(C) Capital receipts
(D) Current receipts
3. Quantitative restrictions on imports by a country will lead to :
(A) Decreased demand for imported products
(B) Increased demand for imported products
(C) Increased supply of imported products
(D) Decreased supply of imported products
4. As per the UNDP's Global Human Development Report 2007, India's relative rankingout of 177 countries in respect of HDI was :
(A) 123
(B) 131
(C) 128
(D) 125
Consider the following statements and select the correct answer from the codes given below for questions 5 to 10(Assertion and Reasoning type item).
5. Assertion (A) : Under oligopoly, all firms are aware of their inter-dependence.Reason (R) : Personal rivalries do not exist among firms under oligopoly.
(A) Both (A) and (R) are false
(B) Both (A) and (R) are true but (R) is not the explanation of (A)
(C) (A) is true, but (R) is false
(D) (A) is false, but (R) is true
6. Assertion (A) : Giffen goods have a positively sloped demand curve.
Reason (R) : The positive substitution effect in their case is more than offset by negative income effect.
(A) Both (A) and (R) are true and (R) is the correct explanation of (A)
(B) (A) is true, but (R) is false
(C) Both (A) and (R) are false
(D) Both (A) and (R) are true, but (R) is not the correct explanation of (A)
7. Assertion (A) : According to Hicks, trade cycle occurs due to the interaction between
multiplier, and accelerator. Reason (R) : In Hicksian business cycle theory, accelerator is impotent in the depression phase.
(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) Both (A) and (R) are false
(D) (A) is true, but (R) is false
8. Assertion (A) : Duesenberry hypothesised that consumption - income relationship is
irreversible.
Reason (R) : Consumption depends not only on current income but also on previous peak income.
(A) Both (A) and (R) are true, but (R) is not the correct explanation of (A)
(B) Both (A) and (R) are true, and (R) is the correct explanation of (A)
(C) (A) is true, but (R) is false
(D) Both (A) and (R) are false
9. Assertion (A) : Backwash effects imply an unfavourable situation arising in
underdeveloped countries. Reason (R) : Undue emphasis on exports of raw-materials at the expense of the growth of domestic manufacturing.
(A) (A) is true, but (R) is false
(B) Both (A) and (R) are false
(C) Both (A) and (R) are true and (R) is the correct explanation of (A)
(D) Both (A) and (R) are true, but (R) is not the correct explanation of (A)
10. Assertion (A) : Low levels of labour productivity exist in underdeveloped countries.Reason (R) : It is due to the lack of physical capital.
(A) Both (A) and (R) are false
(B) (A) is true, but (R) is false
(C) Both (A) and (R) are true and (R) is the correct explanation of (A)
(D) Both (A) and (R) are true, but (R) is not the correct explanation of (A)
answers are:
1.Budgetary deficit
2. Capital receipts
3. Decreased supply of imported products
4. 128
5. (A) is true, but (R) is false
6.Both (A) and (R) are true and (R) is the correct explanation of (A)
7.Both (A) and (R) are true, but (R) is not the correct explanation of (A)
8. Both (A) and (R) are true, but (R) is not the correct explanation of (A)
9.Both (A) and (R) are true and (R) is the correct explanation of (A)
10. (A) is true, but (R) is false.
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