Economics (Part – II) - Mock Test 365

Total Questions: 50

21. ______ is the change in total utility due to consumption of one additional unit of a commodity. [S.S.C. Online MTS (T-I) 20.08.2019 (Shift-I)]

(a) Marginal utility
(b) Maximum utility
(c) Minimum utility
(d) Changed utility

Correct Answer: (a) Marginal utility

Solution:The change in total utility due to consumption of one additional unit of a commodity is called marginal utility. According to Prof Boulding, the marginal utility of a quantity of a commodity is the increase in total utility that results from one unit of consumption.

22. One of the following is 'Labour' in Economics. [S.S.C. Online C.G.L.(T-I) 2.09.2016 (Shift-II)]

(a) A musician performing for a benefit fund
(b) A painter working for his own pleasure
(c) Reading a book as a hobby
(d) A mother teaching her own son

Correct Answer: (a) A musician performing for a benefit fund

Solution:A Musician performing for a benefit fund is an example of 'Labour' in Economics as it is a productive activity generating value.

23. A minimum wage______. [S.S.C. Online CHSL (T-I) 23.01.2017(Shift-II)]

(a) is the price floor below which workers may not sell their labor
(b) is set at a price below the equilibrium wage
(c) creates a price ceiling below which the wage cannot legally go
(d) decreases unemployment

Correct Answer: (a) is the price floor below which workers may not sell their labor

Solution:A minimum wage is the price floor below which workers may not sell their labor.

24. Which curve shows the inverse relationship between unemployment and inflation rates? [S.S.C. Online C.G.L.(T-I) 31.08.2016 (Shift-II)]

(a) Supply curve
(b) Indifference curve
(c) IS curve
(d) Phillips curve

Correct Answer: (d) Phillips curve

Solution:The inverse relationship between the unemployment rate and inflation when graphically charted is called the Phillips curve. William Phillips pioneered the concept first in his paper "The Relation between Unemployment and the Rate of Change of Money Wage Rates in the United Kingdom, 1861-1957, in 1958. This theory is now proven for all major economies of the world.

25. The demand curve______. [S.S.C. Online CHSL (T-I) 30.01.2017(Shift-II)]

(a) shows that as the price of a goods increases, demand for the good will increase
(b) shows that as the price of a goods increases, demand for the goods will decrease
(c) has a positive gradient
(d) indicates that there is a direct relationship between quantity demanded and price

Correct Answer: (b) shows that as the price of a goods increases, demand for the goods will decrease

Solution:The law of demand means that there is an inverse relationship between the price of a commodity and its quantity demanded if the other factors that determine dermand remain constant. When the above relationship between the price of a commodity and the quantity demanded is presented in the form of a diagram, it is called a demand curve. Thus the demand curve is a pictorial representation of the law of demand. The demand curve shows the different quantities of a commodity in the form of a diagram at different prices.

The demand curve shows that as the

26. What is the name given to the graph that shows all the combinations of two commodities that a consumer can afford at given market prices and within the particular income level in economic terms? [S.S.C. Online C.G.L. (T-I) 10.06.2019 (Shift-II)]

(a) Isocost Line
(b) Supply Curve
(c) Budget Line
(d) Demand Curve

Correct Answer: (c) Budget Line

Solution:The Budget Line shows all the combinations of two commodities that a consumer can afford at given market prices and within the particular income level in economic terms In other words, the budget line will show how much quantity of two commodities can be bought by the consumer if a certain budget is fixed.

27. The transformation curve' is also known as the: [S.S.C. Online CHSL (T-I) 12.10.2020 (Shift-III)]

(Transformation Curve)'____.

(a) Production Possibility Curve
(b) Indifference Curve
(c) Supply Curve
(d) Demand Curve

Correct Answer: (a) Production Possibility Curve

Solution:

The 'transformation curve' is also known as the Production Possibility Curve. In macroeconomics, the transformation curve is defined as the maximum amount of one commodity X obtainable for any given amount of another commodity Y, and vice versa.

28. The term 'Dumping' refers to-. [S.S.C. Online C.G.L. (T-I) 10.09.2016 (Shift-II)]

(a) The sale of a sub-standard commodity
(b) Sale in a foreign market of a commodity at a price below marginal cost
(c) Sale in a foreign market of a commodity just at a marginal cost with too much profit
(d) Smuggling of goods without paying any customs duty

Correct Answer: (b) Sale in a foreign market of a commodity at a price below marginal cost

Solution:In economics, "dumping" is a kind of predatory pricing, especially in the context of international trade. It occurs when manufacturers export a product to another country at a price either below the price charged in its home market or below its cost of production.

29. In economic terms what do we mean by 'intermediate goods'? [S.S.C. Online C.G.L. (T-I) 10.06.2019(Shift-III)]

(a) Price of goods without GST
(b) Goods in transit before reaching the consumers
(c) Goods sold between industries for the resale or production of other goods
(d) Fixed assets used by manufacturers

Correct Answer: (c) Goods sold between industries for the resale or production of other goods

Solution:In economic terms, 'intermediate goods' mean goods sold between industries for resale or production of other goods.

30. Who Introduced the term 'Hindu rate of growth? [S.S.C. Online C.G.L(T-I) 11.09.2016 (Shift-I)]

(a) Amartya Sen
(b) Raj Krishna
(e) V. K. R. V. Rao
(d) Kaushik Basu

Correct Answer: (b) Raj Krishna

Solution:The term was coined by Indian economist Raj Krishna. It suggests that the low growth rate of India, a country with a mostly Hindu population, was in sharp contrast to high growth rates in other Asian countries, especially the East Asian Tigers, which were also newly independent.

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Economics (Part – II)