Indian Economy Questions

Q:

The consumption schedule relates:

A) disposable income to domestic income. B) consumption to the level of disposable income.
C) consumption to saving. D) saving to the level of disposable income.
 
Answer & Explanation Answer: B) consumption to the level of disposable income.

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Q:

For a certain shoe factory the fixed costs are Rs 200,000, selling price is Rs 2000 per pair of shoes and variable cost is Rs 1200 per pair, what is the breakeven quantity?

A) 100 B) 62.5
C) 167 D) 250
 
Answer & Explanation Answer: D) 250

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Q:

The account receivable turnover measures

A) How often, on average receivables are received and collected during the period B) How long it takes to sell accounts receivable to a factor
C) The relation of cash sales to credit sales D) How long it takes to sell merchandise inventory
 
Answer & Explanation Answer: A) How often, on average receivables are received and collected during the period

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Q:

The demand for a normal good increases with ________ in the consumer's income.

A) increase B) decrease
C) constant D) double
 
Answer & Explanation Answer: A) increase

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Q:

Which law states that bad money drives good money out of circulation?

A) Wagner's law B) Grimm's law
C) Gresham's law D) Keynes' law
 
Answer & Explanation Answer: C) Gresham's law

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Q:

An increase in the growth rate of the nominal money supply results in

A) Lower rate of inflation B) Higher rate of inflation
C) Lower interest rates D) Currency appreciation
 
Answer & Explanation Answer: B) Higher rate of inflation

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Q:

If Reserve Bank of India reduces the cash reserve ratio, it will :

A) increase credit creation B) decrease credit creation
C) have no impact on credit creation D) have no definite impact on credit creation
 
Answer & Explanation Answer: A) increase credit creation

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Q:

The _________ of a firm is a relationship between inputs used and output produced by the firm.

A) Marginal product B) Production function
C) Total product D) Average product
 
Answer & Explanation Answer: B) Production function

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