Q1.An economic system combining private and public enterprises is called _____
a) Market economy
b) Planned economy
c) Private economy
(d) Mixed economy
(e) None of the above

Q2.What was the main motive behind the Third Five Year Plan in India?
a) Rural development
(b) Agriculture
(c) Financial inclusion
d) Economic reform
(e) None of the above

Q3.When there is only one buyer and one seller of product, it is called _____ situation.
a) Public monopoly
(b) Bilateral monopoly
c) Franchise monopoly
(d) Monopsony
(e) None of the above

Q4. Which of the following is not a balance of payments (BOP) account?
(a) Current account
(b) Capital account
(c) Official Reserve Account
(d) Financial account
(e) None of the above

Q5.Who gave the “general equilibrium theory”?
(a) JM Keynes
(b) Leon Walras
(c) David Ricardo
(d) Adam Smith
(e) None of the above

Q6. What is the accepted average calorie requirement for rural areas in India?
(a)2100
(b)2200
(c) 2300
(d) 2400
(e) None of the above

Q7.At what rate does the Reserve Bank of India borrow money from commercial banks?
(a) Discount rate
(b) Pension rate
(c) Reverse repo rate
(d) Statutory liquidity rate
(e) None of the above

Q8.Movement along the supply curve is known as ______.
(a) Contraction of the offer
(b) Expansion of supply
(c) Increase in supply
(d) Expansion and contraction of supply
(e) None of the above

Q9. The fall in value of a currency against a foreign reference currency is called _________.
(a) Devaluation
(b) Revaluation
(c) Downward valuation
(d) Negative valuation
(e) None of the above

Q10. Fiscal policy in India is formulated by –
(a) Reserve Bank of India
(b) Planning Commission
(c) Ministry of Finance
(d) SEBI
(e) None of the above

Solutions

S1.Res.(d)
Floor. In a mixed economy, the private and public sectors are involved in the economy as two sides of the same coin. The government directs economic activity in certain socially important areas of the economy, leaving the rest to the price mechanism to operate.

S2.Res.(b)
Floor.The 3rd five-year plan placed considerable emphasis on the agricultural sector. However, with the short Sino-Indian War of 1962, India shifted its focus to the security of the country. Again, during the period 1965-1966, thanks to the Green Revolution, agriculture again attracted attention.

S3. Rep.(b)
Floor. A bilateral monopoly is a market structure consisting of both a monopoly (one seller) and a monopsony (one buyer).

S4.Res.(c)
Floor.The official reserves account is not a balance of payments (BOP) account.

S5. Rep.(b)
Floor. The French economist Léon Walras in his pioneering work Elements of Pure Economics in 1874 gave the general equilibrium theory. It attempts to explain the behavior of supply, demand and prices in an entire economy with several or more interacting markets, seeking to prove that the interaction of demand and supply will result in a global general equilibrium.

S6. Rep.(d)
Floor.The nutritional requirement recommends a national standard of 2,400 kcal per day for rural areas and 2,100 kcal per day for urban areas, with the difference attributed to lower physical activity rates in urban areas.

S7. Rep.(c)
Floor. The Reverse Repo rate is the rate at which RBI borrows money from commercial banks. It is a monetary policy instrument that can be used to control the money supply in the country.

S8. Rep.(d)
Floor. A movement along the supply curve will occur when the price of the good changes and the quantity supplied changes in accordance with the original supply relationship. In other words, a movement along the supply curve is known as supply expansion and contraction.

S9. Rep.(a)
Floor. Devaluation is a deliberate downward adjustment in the value of one country’s currency against another currency.

S10. Rep.(c)
Floor.Fiscal policy in India is formulated by the Ministry of Finance.