Tag: economic mechanism

Questions Related to economic mechanism

Which of the following is/are an outcome of a technological change?

organisation of commerce and management economics of development and planning fundamental of economic development economics of development economic mechanism

  1. A downward shift in the production function

  2. Same output with fewer inputs or more output with same inputs

  3. Invention of a product or production process

  4. Both (b) and (c) above

Show answer
Correct Option: D
Explanation:
1) Same output with fewer inputs or more output with same inputs
2) Invention of a product or production process
Both the situations can be defined as an outcome of a technological change as the production rises because of technological advancement in both the situation.
As a result, the production possibility curve will shift to the right.

 Production is a / an _____________ activity.

organisation of commerce and management economics of development and planning fundamental of economic development economics of development economic mechanism

  1. Charitable

  2. Beneficial

  3. Economic

  4. Successful

Show answer
Correct Option: C
Explanation:
Economic activity is an activity that generates income and involves production, sale and distribution of goods and services. The motive behind an economic activity is to earn money and not to meet emotional and sentimental human needs. 
Thus, production is an economic activity that generates income and is undertaken with a motive to earn profit.
The correct option is C.

Ram : My corn harvest this year is poor.
Krishna : Don't worry. Price increases will compensate for the fall in quantity supplied.
Vinod : Climate affects crop yields. Some years are bad, others are good.
Madhur : The Government ought to guarantee that our income will not fall.
In the conversation the normative statement is made by ______________.

organisation of commerce and management economics of development and planning fundamental of economic development economics of development economic mechanism

  1. Ram

  2. Krishna

  3. Vinod

  4. Madhur

Show answer
Correct Option: D
Explanation:

Normative Statement refers to "What ought to be" or it makes an assessment of an activity and offers advice. Hence the statement made by Madhur is a normative statement.

Custom Duties are levied on ______________.

organisation of commerce and management economics of development and planning fundamental of economic development economics of development economic mechanism

  1. Exports and Imports

  2. Manufacture of excisable goods / commodities

  3. Services Rendered

  4. Sale made by a Dealer in the course of inter-state or intra-state or commerce

Show answer
Correct Option: A
Explanation:

Custom Duties are levied on exports and imports. Custom duty can also be defined as a type of tax which should be paid by people for exporting to foreign countries and importing goods from foreign countries.

Convertibility of rupee means _________.

organisation of commerce and management economics of development and planning fundamental of economic development economics of development economic mechanism

  1. determination its own exchange rate in international market

  2. conversion of rupee into any foreign currency

  3. transfer of funds in international market

  4. none of these

Show answer
Correct Option: B
Explanation:

Convertibility of rupees refers to the ability of rupees to be converted into any foreign currency backing with the exchange rate that prevails at the time of conversion. 

'Economics is what Economists do' is given by _____________.

organisation of commerce and management economics of development and planning fundamental of economic development economics of development economic mechanism

  1. Jacob Viner

  2. Henry Smith

  3. Pigou

  4. Paul A. Samuelson

Show answer
Correct Option: A
Explanation:

Jacob Viner defined Economics as  'Economics in what Economists do'.

Oikonomia means ______________.

organisation of commerce and management economics of development and planning fundamental of economic development economics of development economic mechanism

  1. industry

  2. household

  3. services

  4. none of these

Show answer
Correct Option: B
Explanation:

"Oikonomia" is a Latin word which means household as it is related to the financial management of  household activities through which the concept of economics was derived. 

The term 'Economics' owes its origin to the Greek word ___________.

organisation of commerce and management economics of development and planning fundamental of economic development economics of development economic mechanism

  1. Aikonomia

  2. Wikonomia

  3. Oikonomia

  4. None of the above

Show answer
Correct Option: C
Explanation:

The term 'Economics' owes its origin to the Greek work 'Oiknonomiia' means 'household'.

In the pre-reforms period (i.e. before 1991), restrictions on import consisted of:

organisation of commerce and management economics of development and planning fundamental of economic development economics of development economic mechanism

  1. Import Licenses

  2. Quantitative Restrictions

  3. Quota System

  4. All of the above

Show answer
Correct Option: D
Explanation:

India had  adopted socialist form of economy before 1991 which involved a lot of government intervention into International trade where import was banned on most of the goods through quota and licenses so that the foreign goods does not dominate domestic market. 

In the pre-reforms period (i.e. before 1991), Import of food grains was permitted ______________.

organisation of commerce and management economics of development and planning fundamental of economic development economics of development economic mechanism

  1. In order to meet domestic demand in case of shortage of foodgrains

  2. To help Indians consume nutritious food

  3. Whenever there was a favourable Balance of Trade

  4. All of the above

Show answer
Correct Option: A
Explanation:

In the pre-reforms period (i.e. before 1991), Import of food grains was permitted in order to meet domestic demand in case  of shortage of foodgrains. Demand for food grains by the nation used to fall short in the pre-reform period, hence to  cope up with the shortage of food grains, import was done from the foreign countries.