Result Oriented SSC & Bank Exam Preparation Tips: UGC NET ECO PAPER III MCQS FOR UNIT IV

Unit-IV

Theories of taxation, types, incidence and effects

Theories of public expenditure – effects on savings, investment and growth Burden of public debt

Union Finance – Trends in Revenue and Expenditure of the Government of India

State finance – Trends in Revenue and Expenditure of the State Governments

Public Debt – India’s Public debt since 1951 – growth composition, ownership pattern and debt management

Union-State Financial Relations – Horizontal and vertical imbalances; the Finance Commissions

Fiscal Policy and Fiscal Reforms in India

1.Which of the following is not a direct tax?

a) Wealth Tax

b) Income Tax

c) Estate Duty

d) Sales Tax

Ans. d

2. Fiscal Policy is connected with

a) Issue of currency

b) exports and imports

c) public revenue and expenditure

d) None of these

Ans. c

3.The income tax in India is

a) indirect and progressive

b) direct and proportional

c) direct and progressive

d) indirect and proportional

Ans. c

4.An ad valorem duty is a tax on the basis of

a) the price of a commodity

b) the value added

c) the advertisement expenditure

d) the unit of the commodity

Ans. a

5. Government imposes taxes to ?

a) check the accumulation of wealth among the rich

b) Run the machinery of state

c) uplift weaker sections

d) None of these

Ans. b

6.The largest revenue in India is obtained from?

a) Sales Tax

b) Direct Taxes

c) Excise Duties

d) None of these

Ans. c

7.To know whether the rich are getting richer and the poor getting poorer, it is necessary to compare

a) The availability of food grains among two sets of people, one rich and the other poor, over different periods of time

b) The distribution of income of an identical set of income recipients in different periods of time

c) The wholesale price index over different periods of time for different regions

d) The distribution of income of different sets of income recipients at a point of time

Ans. b

8.Which of the following are the main causes of slow rate of growth of per capita income in India?
I. High capital - output ratio
2. High rate of growth of population
3. High rate of capital formation
4. High level of fiscal deficits

a) 1,2

b) 2,3,4

c) 1,4

d) All of the Above

Ans. a

9.Which of the following governmental steps has proved relatively effective in controlling the double digit rate of inflation in the Indian economy during recent years

a) Containing budgetary deficits and unproductive expenditure

b) Streamlined public distribution system

c) Enhanced rate of production of all consumer goods

d) Pursuing an export -oriented strategy

Ans. c

10.India’s wage policy is based on ?

a) Cost Of Living

b) Standard of living

c) productivity

d) None of these

Ans. a

11.One of the reasons for India’s occupational structure remaining more or less the same over the years has been that

a) Productivity in agriculture has been high enough to induce people to stay with agriculture

b) People are largely unaware of the significance of transition from agriculture to industry for economic development.

c) Investment pattern has been directed towards capital intensive industries.

d) ceilings-on land holdings have enabled more people to own land and hence their preference to stay with agriculture

Ans. b

12. Which of the following is correct regarding the Gross Domestic Savings in India?

a) Contribution of Household sector is the largest

b) Contribution of Government sector is the largest

c) Contribution of Corporate sector is the largest

d) None of these.

Ans. a

13. Which Committee recommended abolition of tax rebates under section 88 ?
(A) Chelliah Committee
(B) Kelkar Committee
(C) Shome Committee
(D) None of the above

Ans. (B)

14. CENVAT is related to—
(A) Sales Tax
(B) Excise Duty
(C) Custom Duty
(D) Service Tax

Ans. (B)

15. Which percentage of Central Taxes have been recommended by the 12th Finance Commission to be transferred to States ?
(A) 28·5%
(B) 29·5%
(C) 30·5%
(D) 31·5%

Ans. (C)

16. VAT is imposed—
(A) Directly on consumer
(B) On final stage of production
(C) On first stage of production
(D) On all stages between production and final sale
Ans: (D)

17. Govt. has decided to provide interest subsidy on housing loan upto Rs. one lakh to the urban poor during 11th five year plan. The granted interest subsidy is of—
(A) 5%
(B) 7·5%
(C) 10%
(D) 12·5%

Ans(A)

18. Competition (Amendment) Bill, 2007 has replaced—
(A) VAT
(B) MRTPC
(C) Securities Contracts (Regulation) Bill, 2005
(D) Electricity Act, 2003
Ans : (B)

19. For senior citizens, income tax exemption limit in Budget 2010-11 is—
(A) Rs. 1•75 lakh
(B) Rs. 1•85 lakh
(C) Rs. 2•40 lakh
(D) Rs. 2•10 lakh
Ans : (C)

20.Which of the following concepts represents the extra revenue a firm receives from the services of an additional unit of a factor of production?
a. total revenue
b. marginal physical product
c. marginal revenus product
d. marginal revenue

Ans. C

21. Income from taxes is divided-
(A) State’s income from taxesis shared by Centre
(B) Income of some taxes of the Centre is shared by States
(C) States and the Centre have independent sources of income and no sharing
(D) None of the above

Answer.B

22. Minimum wage should be deter-mined-
(A) Less than prevailing wagerates
(B) Higher than equilibriumrate in die market
(C) Minimum Physical andSocial needs may be fulfilled
(D) None of the above

Answer.C

23 Pigou’s concept of equilibrium firm is a-
(A) Completely new concept, having nothing to do with Marshallian representative firm
(B) Revised version of Marshallian representative firm
(C) Marshall’s representative firm is a revised version of Pigou’s equilibrium firm
(D) None of the above

Ans. c

24. Tax on Banking Cash Transactions (withdrawals) over a certain threshold in a single day was introduced in the Union Budget of which year?
a. 2002 - 03
b. 2004 - 05
c. 2005 - 06
d. 2006 – 07

Ans. d

25. In which of the following years was the tax revenue as a percentage of GDP, the lowest?
a. 2002 - 03
b. 2003 - 04
c. 2004 - 05
d. 2005 - 06
Ans. c

26. Which among the following is not a committed expenditure of the Government of India?
a. Interest payments
b. Pay and allowances
c. Transfers to States and Union Territories
d. Loans and advances to States and Union Territories

Ans. c

27. Who among the following developed the wage-goods model?
a. M. Dobb
b. A.K.Sen
c. Vakil and Brahmananda
d. P. C. Mahalanobis

Ans. c

28. Match List - I with List - II and select the correct answer using the code given below the lists:
List - I (Concept)
A. Vicious circle of poverty
B. Balanced growth
C. Big push

List - II (Explanation)
1. Massive increase in investment to initiate economic development in LDCs
2. A stagnant low level of investment
3. Simultaneous investment in all interrelated industries

A B C
a. 2 3 1
b. 1 2 3
c. 2 1 3
d. 1 3 2

Ans. b

29. Which one of the following statements is correct?
According to the classical economists, the existence of unemployment at any time is only of temporary nature and can be considered as
a. structural unemployment
b. cyclical unemployment
c. frictional unemployment
d. disguised unemployment

Ans. a

30. The shift in the SS curve to S’S’ is due to an imposition of a tax. Which of the following areas in the diagram shows excess burden of the tax?
a. ODD’
b. SDA
c. FGA
d. CAD’

Ans. d

31. Which one of the following is a source of non-tax revenue for governments?
a. Import duty on cars
b. Octroi at check points on roads
c. Entrance fee to museums
d. Excise duty on beverages

Ans. a

32. The Laffer Curve explains the relationship between which of the following?
a. Tax rates and tax revenue
b. Tax rates and employment
c. Tax rates and income
d. Tax rates and government expenditure

Ans. b

33. What does an increase in the ratio of revenue deficit to gross fiscal deficit indicate?
a. An increase in investment
b. An increase in the utilization of borrowed funds for revenue purposes
c. An increase in the utilization of borrowed funds for imports
d. An increase in the utilization of borrowed funds for leading

Ans. a

34. If in a year, the gross fiscal deficit of a government is Rs. 3,00,000 crores, revenue deficit is Rs. 1,50,000 crores and interest payments are Rs. 80,000 crores, what is the primary deficit of the government in the year?
a. Rs. 23,000 crores
b. Rs. 45,000 crores
c. Rs. 70,000 crores
d. Rs. 2,20,000 crores

Ans. a

35. Which one of the following does not constitute a part of the jurisdiction of WTO?

(a) Trade related tariff and non-tariff barriers

(b) Trade related intellectual property rights

(d) Regional trade agreements

Ans. (d)

36. Inverted-U hypothesis of Kuznets is associated with movement of which one of the following?

(a) Consumption inequality

(b) Wealth inequality

(d) Tax inequality

Ans. (c)

37. Match List-I with List-II and select the correct answer by using the code given below the lists:

List-I List -II

(Model) (Proposition)

A. Marxist model of economic development 1.Give importance to

non-economic variables

B. Harrod-Domar growth model 2. Flexible capital-output ratio is assumed

C. Solow’s growth model 3. Productive capacity is equal to

aggregate demand

D. Kaldor’s growth model 4. Structural Mal –adjustment in a

growing economy

Code:

A B C D

(a) 4 2 3 1

(b) 1 3 2 4

(d) 1 2 3 4

Ans. (c)

38. What is the major underlying assumption of efficiency wage models?

(a) Labour productivity depends on level of nutrition

(b) Labour productivity is independent of number of labourers -

(d) Capital and labour productivities are equal

Ans. (b)

39. How is ‘Path dependency defined as?

(a) A condition of the past affecting the past situation

(b) A comparatively fast path of progress of economy

(d) A slow path of progress of the economy

Ans. (c)

40. Match List-I with List-II and select the correct answer using the code given below the lists:

List –I List-II

(Type of Unemployment) (Associated Fact)

A. Frictional Unemployment 1.Non-availability of job

B. Structural Unemployment 2. Marginal productivity is zero

C. Seasonal Unemployment 3. Use of obsolete technology for production

D. Disguised Unemployment 4. Population pressure on land

Code:

A B C D

(a) 4 2 1 3

(b) 1 3 4 2

(d) 1 2 4 3

Ans. (b)

41. According to the 60th Round of NSSO Survey on Employment and Unemployment, unemployment rate on current daily status basis (number of person days per 1000 person days) was highest for which one of the following categories?

(a) Rural male

(b) Rural female

(d) Urban female

Ans. (a)

42. Which one of the following committees was set up to review the concept of poverty line?

(a) S. Chakravarty Committee

(b) D.T, Lakdawala Committee

(d) R.C. Dust Committee

Ans. (b)

43. Consider the following components of money supply in India

1. Currency in circulation.

2. Banker’s deposits with the RBI

3. Other deposits with the RBI

4. Demand deposits of banks

Which of the above are the components of Reserve Money?

(a) l and 3

(b) l, 2 and 3.

(d) 2, 3 and 4

Ans. (B)

44. In which one of the following situations should a country pursue a cheap money policy?

a. Balance of payments is unfavorable

b. Price-are rising

c. Gold is likely to flow out of the country

d. Level of employment is low

Ans. c

45. Match List 1 with List 2 and select the correct answer using the codes given below the lists.

List I

A. Absolute advantage

B. The doctrine of comparative cost

C. Investment multiplier

List II

1. J.S. Mill

2. J.M Keynes

3. David Ricardo

4. Adam Smith

Codes:

A B C

a. 4 3 2

b. 3 1 2

c. 4 2 3

d. 2 3 4

Ans. c

46. match List I with List II and select the correct answer from the codes given below the Lists:

List I (Name of the author)

A. F.Y. Edgeworth

B. Prebisch – Singer

C. Jacob Viner

List II (Important concept in

International Trade)

1. Box diagram

2. Trade diversion and Trade creation effects of customs union

3. Secular deterioration of terms of trade of developing countries

Codes:

A B C

a. 1 3 2

b . 2 3 1

c. 3 1 2

d. 1 2 3

Ans. a

47. In the keynesian system, all fall in money wage rate will lead to:

a. an increase in employment

b. a decrease in the price level

c. an increase in the interest rate

d. a decrease in the quantity of money

Ans. a

48. Phillips curve shows the relation between the

a. percentage of wage increase and the percentage of unemployment of economy's labour force

b. percentage of wage' increase and the percentage of increased employment of economy's labour force

c. percentage of price change and the percentage of change in income

d. percentage of price change and the percentage of change in demand.

Ans. b

49. In the Ricardian model, a higher growth rate of accumulation will.

a. postpone the stationary state

b. hasten the stationary state

c. reduce the population growth rate

d. cause increasing returns to emerge

Ans a

50. If a tax system collects Rs 100 from individuals with income of Rs. 1000 and Rs. 150 from individuals with income of Rs. 2000, the tax system is said to be

a. regressive

b. progressive

c. proportional

d. none of the above

Ans. c

51. The real value of tax on a given level of real income under progressive income taxation

a. rises under inflation

b. decreases under inflation

c. remains unchanged under inflation

d. rises under depression

Ans. d

52. Assertion (A): Guaranteeing right to work is a full employment policy.

Reason (R): This is a necessary condition for solving unemployment in India.

a. Both A and R are true and R is the correct explanation

b. Both A and R are true but R is not a correct explanation

c. A is true but R is false

d. A is false R is true

Ans. a

53. In calculating a country's NNP at factor costs, which on of the following elements is not included?

a. Rent, interest, wages and profits

b. Supplements to wages paid by employers under social security arrangements.

c. Factor payments from abroad

d. Indirect taxes.

Ans. c

54. The size of the gap between actual and potential GNP is a measure of

a. inflationary gap

b. deflationary gap

c. savings-investment gap

d. natural rate of unemployment

Ans. c

55. In Keynesian economics, given the total investment expenditure, an increase in the propensity to save will lead to a

a. fall in the quantity of saving

b. fall in income

c. rise in interest rate

d. rise in income.

Ans. b

56. Disposable income is

a. National Income

b. National Income less direct taxes

c. national Income less direct taxes less undistributed profits

d. National Income less direct taxes less undistributed profits plus transfer payments.

Ans. c

57. A consumer will generally obtain the greatest total utility from expenditure of a given income when.

a. the marginal utility of each commodity purchased is unity

b. the marginal utility of each commodity purchased is in the same ratio to its price.

c. the marginal utility of each commodity purchased is in the same ratio to its cost of production.

d. the prices of the commodities purchased are equal to one another.

Ans. c

58. If the price consumption curve is negative, it is because of one or more of the following reason.

1. Negative Income effect is stronger than

the substitution effect.

2. Substitution effect is negative.

3. The commodity is Giffengood

Of the reason given above

a. 1 alone is correct

b. 1 and 2 are correct

c. 2 and 3 are correct

d. I and 3 are correct

Ans. c

59. if sales tax on a commodity is raised, but the revenue earned through its sale decreases sharply, which one of the following statements about the nature of this commodity would be correct?

a. Price elasticity of demand for it is low

b. It must be an essential good

c. Price elasticity of demand for it is high

d. Price elasticity of demand for it is

unity

Ans. d

60. Which of the following statements is incorrect ?

(A) Monetary Policy is relatively ineffective, when the interest elasticity of investment is low (IS curve is steep)

(B) Monetary Policy is relatively ineffective, when the interest elasticity of demand for money is high (LM curve is flat)

(D) Fiscal policy is ineffective, when interest rate elasticity of investment is low (IS curve is steep)

Ans. c

61. Which one of the following is not an instrument of fiscal policy ?

(A) Public Revenue

(B) Public Expenditure

(D) Cash Reserve Ratio

Ans. c

62. Who is Director General of WTO ?

(A) Alan Greenspan

(B) Lamy Pascal

(D) Eugine Black

Ans. d

63. Which one of the following is the most important source of revenue of State Governments in India ?

(A) Land Revenue

(B) Sales Tax

(D) State Excise Duties

Ans. d

64. Equity in Taxation can best be achieved by applying the principle of

(A) Equal Absolute Sacrifice

(B) Benefit

(D) Equal Proportional Sacrifice

65. Which of the following is correct measurement of fiscal deficit in India ?

(A) Excess of total revenue expenditure over total revenue receipts.

(B) Excess of total expenditure over total revenue receipts plus non-debt capital receipts.

(D) Excess of total expenditure over total interest payments.

Ans. c

66. Assertion (A) : Indirect taxes promote inequalities in the distribution of income.

Reason (R) : The poor bear more burden of indirect taxes.

Codes :

(A) (A) is true but (R) is false.

(B) Both (A) and (R) are true and (R) is the correct explanation of (A).

(D) Both (A) and (R) are false

Ans. d

67. Which of the following is not one of the objectives of the tax reforms in India ?

(A) Reduction in multiplicity of custom duty rates

(B) Improving tax compliance

(D) Suggesting ways to increase the share of indirect taxes in total tax revenue

Ans. a

68. Match the list – I with the list – II and select the answer from the codes given below :

List-I List-II

(a) Theory of big push (I) Harvey Leibenstein

(b) Unlimited supply of labour (II) Lewis

(d) The concept of economic growth (IV) Kuznets

(a) (b) (c) (d)

(A) IV III II I

(B) I II III IV

(D) III IV I II

Ans. c

69. If the accommodating capital is zero in the balance of payments of a country, there will be

(A) equilibrium in the balance of payments.

(B) disequilibrium in the balance of payments.

(D) surplus in the balance of payments.

Ans. a

70. Assertion (A) : The average and thespread of indirect taxes havebeen lowered in India over thepast two decades.

Reason (R) : Tax-GDP ratio in India has declined during this period.

Codes :

(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).

(D) (A) is false, but (R) is true.

Ans. d

71. The classical analysis of determination of output and employment is characterised as a

(A) Static Analysis

(B) Comparative Static Analysis

(D) All of the above

Ans. a

72. Assertion (A) : The role of monetary policy in a developing economy in general is to achieve growth with stability.

Reason (R) : It makes availability of credit to public at cheaper rate of interest.

Codes :

(A) (A) is correct but (R) is not the explanation of (A).

(B) Both (A) and (R) are incorrect.

(D) Both (A) and (R) are correct

Ans. c

73. Match the List-I with List-II and select the answers from the codes given below :

List – I List – II

(a) Life cycle hypothesis 1. Franco Modigliani

(b) Liquidity trap 2. J. Duesenberry

(d) Real balance effect 4. J.M. Keynes

Codes :

(a) (b) (c) (d)

(A) 1 4 3 2

(B) 1 2 3 4

(D) 1 4 2 3

Ans. c

74. Which one of the following is considered as non-debt creating foreign investment inflow ?

(A) External assistance

(B) Foreign direct investment

(D) Commercial borrowings

Ans. d

75. Which one of the following is not the objective of monetary policy in India ?

(A) To accelerate economic development

(B) To achieve price stability

(D) To stabilise exchange rate

Ans. d

76. Match List-I with List-II and select the answer using the codes given below :

List – I List – II

(a) J.M. Keynes 1. Economics of imperfect competition

(b) David Ricardo 2. General theory of employment, interest and money

(d) Mrs. Joan Robinson 4. Wealth of Nations

Codes :

(a) (b) (c) (d)

(A) 2 3 4 1

(B) 3 4 1 2

(D) 1 2 3 4

Ans. c

77. Match List-I with List-II and select the answer using the codes given below :

List – I List – II

(a) Open-general license 1. Employment

(b) TRYSEM 2. External trade

(d) Cash-reserve ratio 4. Inflation

Codes :

(a) (b) (c) (d)

(A) 2 1 4 3

(B) 2 4 3 1

(D) 3 2 1 4

Ans. c

78. Which one of the following is not correctly matched in the case of India ?

(A) Revenue expenditure : Revenue receipts + Revenue deficit

(B) Primary deficit : Revenue deficit – interest payments

(D) Revenue receipts : Tax revenue + non-tax revenue

Ans. d

79. The incidence of sales tax is on the seller when the demand curve

(A) for the product is a rectangular hyperbola

(B) for the product is perfectly elastic

(D) for the product is moderately Elastic

Ans. a

80. A progressive income tax implies that

(A) the amount of tax falls with a rise in income

(B) the rate of tax rises with a rise in income

(D) the rate of tax decreases with a rise in income

Ans c

81. If the economy is in the liquidity trap, then

(A) Fiscal policy will be more effective

(B) Monetary policy will be more effective

(D) None of the above

Ans. d

82. Green Box subsidies under WTO are allowed because they are considered to be

(A) Minimally trade distorting.

(B) Higher among developed and relatively lower for developing countries.

(D) They are related to GATS Provision

Ans. c

83. Assertion (A) : Consumption is high when saving is high.

Reason (R) : Income is high when investment is high.

Codes :

(A) Both (A) and (R) are true, and (R) is the correct explanation of (A).

(B) Both (A) and (R) are true, and (R) is not the correct explanation of (A).

(D) (A) is false but (R) is true

Ans. d

84. Assertion (A) : In Keynesian theory, investment level depends upon rate of interest.

Reason (R) : Rate of interest is cost of production to the company.

Codes :

(A) Both (A) and (R) are true, and (R) is the correct explanation of (A).

(B) Both (A) and (R) are true, and (R) is not the correct explanation of (A).

(D) (A) is false but (R) is true

Ans. a

85. (i) Raj Committee on Taxation of Agricultural Wealth and Income.

(ii) Chellaiah’s Tax Reform Committee

(iii) Taxation Enquiry Commission

(iv) The Indirect Tax Enquiry Committee

Codes :

(A) (i) (ii) (iii) (iv)

(B) (iii) (i) (iv) (ii)

(D) (ii) (i) (iii) (iv

Ans. d

85. List – I List – II

(a) Consumer’s Surplus (i) Supply decision

(b) Utility theory (ii) Art of Advertising

(d) Product differentiation (iv) Welfare economics

Codes :

(a) (b) (c) (d)

(A) (iv) (iii) (i) (ii)

(B) (iv) (iii) (ii) (i)

(D) (iii) (iv) (i) (ii)

Ans. a

86. List – I List – II

(a) Keynesian theory of distribution (i) W.S. Javons

(b) Time preference theory of interest (ii) J.M. Keynes

(d) Modern theory of income

determination (iv) Bohm Bawerk

Codes :

(a) (b) (c) (d)

(A) (ii) (i) (iv) (iii)

(B) (ii) (iv) (i) (iii)

(D) (iii) (i) (iv) (ii)

Ans. a

87. List – I List – II

(a) Fiscal Deficit (i) Revenue and interest receipts minus revenue expenditure

(b) Revenue Deficit (ii) Revenue receipts and recovery of loans and other receipts minus total expenditure.

(d) Capital Deficit (iv) Total receipts minus total disbursements

Codes :

(a) (b) (c) (d)

(A) (i) (ii) (iii) (iv)

(B) (ii) (i) (iv) (iii)

(D) (iv) (iii) (i) (ii)

Ans. c

Note : Read the passage given below and answer questions from 88 to 91based on your understanding of the passage :

The birth of Bretton Woods institutions in the 1940s was a direct response to the dismal experience of the 1920s and 1930s. Many of those surveying the wreckage of the global economic system in the dreary days of the Second World War among them, John Maynard Keynes, the dominant economic thinker of that time – came to a simple conclusion. The world’s economic system needed honest referees. It could not be left to the mercy of unilateral action by governments or to the unregulated workings of international markets. It needed unilateral institutions of economic governance to lay down some mutually agreed rules for all nations on the conduct of their affairs. Thus emerged the International Monetary Fund (IMF), the International Bank for Reconstruction and Development (IBRD), or the World Bank and, later, the General Agreement on Tariffs and Trade (GATT).

88. Dismal performance of world economy during 1920’s and 1930’s gave rise to

(A) World Trade Organisation

(B) United Nations

(D) European Economic Union

Ans. c

89. Bretton Woods twins are

(A) USA and UK

(B) IMF and World Bank

(D) GATT and UNESCO

Ans. c

90. The honest referee during the Bretten Woods negotiations was

(A) Adam Smith

(B) Amartya Kumar Sen

(D) J.M. Keynes

Ans. c

91. The outcome of Bretten Woods negotiations was

(A) Replacement of Unilateral Institutions by Multilateral institutions.

(B) Replacement of Multilateral Institutions by Unilateral Institutions.

(D) Replacement of International Trade Organisation by IBRD.

Ans. a

92. If interest payments are subtracted from gross fiscal deficit, the remainder will be

(A) revenue deficit

(B) gross primary deficit

(D) budgetary deficit

Ans. c

93. Labour theory of value was propounded by

a. Adam Smith

b. David Ricardo

c. Ragnar Nurkse, Gunnar Myrdal, R.M. Solow

d. Fei-Rani’s, Ragnar Nurkse

Codes :

(A) a and b (B) a and c

Ans. c

94. The features of the classical system are

a. Monetary factors determine output and employment.

b. Self adjusting mechanism of the economy.

c. State action to direct development.

d. Optimization through market in the absence of state control.

Codes :

(A) a and b (B) a, b, c

Ans. a

95. Factor endowment theory is also known as

a. Modern theory of international trade.

b. Classical theory of international trade.

c. Reciprocal demand theory.

d. Factor proportions theory of international trade.

Codes :

(A) a and b (B) b and c

Ans. c

96. Identify the correct chronological order of the following theories :

a. Cambridge version of quantity theory of money.

b. Fisher’s version of quantity theory of money.

c. Tobin’s theory of demand for money.

d. Baumol’s theory of demand for inventory.

Codes :

(A) c, d, a, b (B) b, a, d, c

Ans. d

97. Arrange the structure of balance of payments accounts in which these items appear :

a. Capital account

b. Errors and omissions

c. Current account

d. Official settlements account

Codes :

(A) a, b, c, d (B) c, a, d, b

Ans. a

98. List – I List – II

a. Monetary Policy 1. Tax Rate

b. Trade Policy 2. Margin Money

c. Credit Policy 3. Imports and Exports

d. Fiscal Policy 4. Bank Rate

Codes :

a b c d

(A) 4 3 2 1

(B) 4 2 3 1

(D) 2 1 4 3

Ans. a

99. List – I List – II

a. J.M. Buchanan 1. Canons of Public Expenditure

b. Findlay Shirras 2. Functional Finance

c. R.N. Bhargava 3. Public-Choice Theory

d. A.P. Lerner 4. Federal Finance

Codes :

a b c d

(A) 3 2 1 4

(B) 3 1 4 2

(D) 1 4 3 2

Ans. a

100. List – I List – II

a. Low Income Equilibrium Trap 1. Karl Marx

b. Poverty Measurement 2. Adam Smith

c. Laissezfair 3. Nelson

d. Industrial Reserve Army 4. Suresh Tendulkar

Codes :

a b c d

(A) 1 2 4 3

(B) 3 4 2 1

(D) 2 1 3 4

Ans. c

Result Oriented SSC & Bank Exam Preparation Tips

Monday, April 15, 2013

UGC NET ECO PAPER III MCQS FOR UNIT IV

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