जीपीएससी/जीएसएससी परीक्षा पूर्वतयारी

1 Question Description When one firm in the health drinks market started advertising campaign that stressed the nutritional value of its health drinks, all the

remaining 10 health drink majors started similar advertising campaigns to withhold their customers. It suggests that the health

drinks industry is a/an

A Oligopoly

B Oligopsony

C Monopolistically competitive market

D Perfectly competitive market

E None of the above

Correct Answer A

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2 Question Description Suppose an economy is in long-run equilibrium at the full-employment level of output. If government spending then increases -------

A an inflationary gap is created because the aggregate demand curve shifts to the right

B an inflationary gap is created because the aggregate supply curve shifts to the right

C an inflationary gap is created because potential GDP shifts to the left

D a recessionary gap is created because the aggregate supply curve shifts to the left

E None of the above

Correct Answer A

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3 Question Description Consider the following statements in regard to Zero Base Budgeting (ZBB) :

1.)Existing Government programs can be discarded under ZBB if they are found to be outdated.

2.)ZBB is difficult to be applied to Human Development programmes as the outcome of such programme is intangible in nature.

Which of the statements given above is/are correct?

A 1 only

B 2 only

C Both 1 and 2

D Neither1 nor 2

E None of the above

Correct Answer C

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4 Question Description Look at the following statements about real exchange rate

1.It is taken as a measure of a country’s international competitiveness

2.It refers to the relative price of goods

3.It has bearing on export and imports of the country

Which of the statements given above are correct?

A Only 1 and 2

B Only 2 and 3

C Only 1 and 3

D All of the above

E None of the above

Correct Answer D

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5 Question Description With reference to ‗Consumer Confidence Survey‘, consider the following statements:

1.It is released by the Central Statistics Office (CSO)

2.This Survey is being used by the Reserve Bank as one of the important inputs for monetary Policy formulation.

Which of the statements given above is/are correct?

A 1 only

B 2 only

C Both 1 and 2

D Neither 1 nor 2

E None of the above

Correct Answer B

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6 Question Description Which is the main point on the basis of which public finance can be separated from private finance:

A Price policy

B Borrowings

C Secrecy

D Elasticity in income

E None of the above

Correct Answer C

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7 Question Description Which of the following statements is false?

A There will be no consumer surplus under first degree price discrimination.

B Dead weight loss is high under first degree price discrimination.

C Third degree price discrimination involves separating consumers or markets in terms of their price elasticity of demand.

D Under third degree price discrimination a firm charges a lower price in a market with more elastic demand than in the market with

less elastic demand.

E None of the above

Correct Answer B

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8 Question Description What would be the sequence of events when RBI increases money supply by reducing CRR?

i)Interest rates fall.

ii)Increase in investment expenditure.

iii)Portfolio disequilibrium.

iv)Increase in price of financial assets.

A (i), (ii), (iii), (iv).

B (iii), (iv), (i), (ii).

C (ii), (iii), (iv), (i).

D (iv), (iii), (ii), (i).

E None of the above

Correct Answer B

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9 Question Description I f the government increases its expenditure and simultaneously adjusts the tax rate such that the budget deficit remains at the

original level, then which of the following is true?

A The equilibrium income remains unchanged.

B The equilibrium income increases by the amount of increase in government expenditure.

C The equilibrium income will increase by the amount of increase in government expenditure if marginal propensity to consume is

greater than the investment- income ratio in the investment function.

D The equilibrium income will increase by the amount of increase in government expenditure if marginal propensity to consume is

equal to the investment-income ratio in the investment function.

E None of the above

Correct Answer D

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10 Question Description The deficit on current account implies

A Exports of merchandize goods, invisibles is less than imports of merchandize goods, invisibles

B Foreign direct investment in the country is more than exports

C Domestic industries are financed more by the international financial institutes than local financial institutions

D Exports of merchandize goods are less than merchandize imports

E None of the above

Correct Answer A

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11 Question Description The Keynesian remedy for unemployment is to

A Decrease aggregate demand.

B Reduce tax rates or lower interest rates.

C Decrease government spending.

D Decrease private consumption and investment.

E None of the above

Correct Answer B

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12 Question Description If the marginal benefit from another computer exceeds the marginal cost of the computer, then to use resources efficiently,

A I f the marginal benefit exceeds the marginal cost by as much as possible, the efficient amount of resources are being used to

produce computers.

B Fewer resources should be used to produce computers.

C More resources should be used to produce computers.

D None of the above is correct because marginal benefit and marginal cost have nothing to do with using resources efficiently.

E None of the above

Correct Answer C

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13 Question Description If RBI wants to ‘sterilize’ an inflow of foreign exchange, it should

A Lower the bank rate

B Lower the CRR

C Sell government securities in the open market

D Increase the repo rate

E None of the above

Correct Answer C

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