Deck 2: Economic Policies and Public Finance

Question 1

Two sector economy consists of:

A)households, firms
B)households, government
C)firms, foreign sector
D)firms, government.

Answer 1

A

Question 2

Real flow is also known as:

A)nominal flow
B)money flow
C)physical flow
D)both a and b

Answer 2

C

Question 3

Which of the following is the consumption sector?

A)household
B)firm
C)government
D)foreign

Answer 3

A

Question 4

Real flow refers to the flow of factor services from ------ to -----

A)firms to households
B)households to firms
C)firms to government
D)households to government

Question 5

Which of the following constitute the reason for difference between Market prices and factor cost?

A)indirect taxes
B)subsidies
C)both a and b
D)neither a nor b

Question 6

Final goods refer to those goods which are used either for ............. or for ..........

A)consumption, investment
B)consumption, resale
C)resale, investment
D)resale,further production.

Question 7

Net Factor Income from Abroad is:

A)export minus imorts
B)visible exports minus visible imports
C)factor income received from abroad minus factor income paid abroad
D)factor income received from abroad

Question 8

Depreciation means:

A)destruction of a plant in a fire accident
B)loss of fixed assets over time due to wear and tear
C)loss of fixed assets in an earthquake
D)closure of the plant due to lockout

Question 9

Non-exclusion principle is related to:

A)private goods
B)public goods
C)merit goods
D)mixed goods.

Question 10

Education is an example of:

A)public good
B)merit good
C)social good
D)club good

Question 11

Public Goods are:

A)excludable
B)non - excludable
C)marketable
D)all of these

Question 12

Who is the father of Public Finance:

A)dalton
B)pigou
C)smith
D)musgrave

Question 13

Incidence of tax means:

A)direct money burden
B)indirect money burden
C)actual tax burden
D)none of these

Question 14

Which is the tax shifting

A)to bear the tax burden himself
B)to shift the tax burden on others
C)to bear some part of the tax himself and shift the rest on others
D)none of these

Question 15

The equity principle of taxation was propounded by:

A)adam smith
B)dalton
C)j.b. say
D)marshall

Question 16

BOP includes

A)current account
B)capital account
C)official reserve account
D)all the above

Question 17

International trade refers to trade between

A)two regions of a country
B)two countries
C)two commodities produced in different countries
D)non of the above

Question 18

Under a fixed exchange rate system, ____________________are official changes in the value of a country's currency relative to other currencies.

A)devaluation
B)depreciation and appreciation
C)revaluation
D)both a and c

Question 19

__________ is the deliberate downward adjustment in the official exchange rate, reduces the currency's value.

A)devaluation
B)depreciation
C)revaluation
D)appreciation.

Question 20

A _______________is an upward adjustment in the official exchange rate, which increases the value of the currency.

A)devaluation
B)depreciation
C)revaluation
D)appreciation

Question 21

Which among following is NOT an implication of devaluation?

A)devaluation makes the country's exports relatively less expensive for foreigners.
B)devaluation makes foreign products relatively more expensive for domestic consumers, thus discouraging imports.
C)devaluation help to increase the country's exports
D)may therefore help to reduce the current account surplus.

Question 22

Which among following is an implication of revaluation?

A)revaluation makes the country's exports relatively more expensive for foreigners.
B)revaluation makes foreign products relatively more expensive for domestic consumers, thus encouraging imports.
C)revaluation help to reduce the country's exports to reduce the current account surplus.
D)all the above

Question 23

Devaluation leads to

A)increasing the price of imports and stimulating greater demand for domestic products.
B)domestic inflation.
C)rise in domestic interest rates.
D)all the above

Question 24

PDS Stands for:

A)public distribution system
B)public division system
C)price distribution system
D)all of these

Question 25

Agricultural Credit is given by.

A)co-operatives
B)rrbs
C)nabard
D)all of the above

Question 26

India's Green revolution was most successful in …………Production:

A)wheat
B)rice
C)maize
D)cotton

Question 27

The worst form of land tenurs system was…………………….

A)zamindary
B)riotwary
C)mahalwari
D)malguzari

Question 28

When the first industrial policy was introduced ?

A)1951.
B)1991.
C)1948.
D)1956

Question 29

Import quota is :

A)tariff
B)non-tariff trade barrier
C)concession
D)international obligation

Question 30

Balance of payments must always balance because:

A)trade deficit is cancelled by invisible credits
B)import always equals exports
C)of an accounting connection
D)what a country gets, it must either pay or save

Question 31

Trade Policy measures for correction of balance of payments disequilibrium include of export promotion:

A)export promotion
B)import control
C)both a & b
D)import substitution

Question 32

In calculating India's balance of payments position, we must:

A)omit invisible items
B)omit exports and imports of gold
C)include expenditure by foreign tourists as imports
D)include long term loans abroad as debit