NTA UGC NET/JRF Exam, Dec. 2021/June 2022 (Commerce) Shift-I

Total Questions: 100

1. Match List I with List II

List-IList-II
Tarriff/SubsidyExplanation
A. TarifficationiThey have demonstrably adverse effects on other member countries.
B. Prohibited subsidiesIIThey act on goods which are contingent upon export performance
C. Actionable subsidiesIIIReplacement of existing non-tariff restrictions
D. Non-actionable subsidiesIVFor industrial research in disadvantaged regions

Choose the correct answer from the options given below:

(A)(B)(C)(D)
(a)iiiiiiiv
(b)iviiiiii
(c)iiiiiiiv
(d)iiiviiii
Correct Answer: (c)
Solution:
List-I Tarriff/SubsidyList-II Explanation
A. TarifficationiiiReplacement of existing Non-tariff restrictions
B. Prohibited subsidiesiiThey act on goods which are contingent upon export performance
C. Actionable subsidiesiThey have demonstrably adverse effects on other member countries.
D. Non-actionable subsidiesivFor industrial research in disadvantaged regions

2. Arrange the following process of making of a contract in the chronological sequence from the first to the last

A. Agreement
B. Promise
C. Offer or proposal
D. Contract
E. Acceptance
Choose the correct answer from the options given below :

Correct Answer: (c) B, D, C, A, E
Solution:

A valid contract have such essential element's agreement's promise offer proposal acceptance. The correct sequence of making of a contract:-

3. Which among the following information shall be disclosed for all public issues of shares irrespective of their issue price?

A. Earning per share
 B. Dividend payout ratio
C. Pre-issue P/E ratio
 D. Average return on net worth in last 3 years
E. Net asset value per share based on last balance sheet
 Choose the correct answer from the options given below :

Correct Answer: (b) A, C, D and E only
Solution:

Earning per share, pre-issue P/E ratio, Average return on net worth in last 3 year's, Net asset value per share based on last balance sheet are the relevant information shall be disclosed for all public issues of shares on their price.

4. The MM hypothesis of the irrelevance of dividends is based on which of the following critical assumptions?

A. Investors are able to forecast future prices and dividends with certainty
B. The firm has a given investment policy which does not change
 C. All financing is done through retained earnings
D. There are no taxes
E. Perfect capital markets in which all investors are rational
Choose the correct answer from the options given below :

Correct Answer: (c) A, B, D and E only
Solution:

Miller & Modigliani's dividend irrelevance theory is sometimes known as homemade dividend theory.
Following are the Critical assumptions of MM hypothesis :

  1. MM model is perfect capital market.
  2. Investor's behave rationally because investors are able to forecast future prices.
  3. the firm has Inflexible Investment Policy.
  4. In MM hypothesis no floatation & transaction costs.
  5. Information about the company is available to all without any cost.

5. Which of the following statements regarding the short- term theory of production and cost analysis are false?

(A) Economic rent is the same as economic profit.
(B) Imputed cost is the rent of a hired building
(C) When AC = MC, AC is minimum
(D) When MC is rising, AC > MC
(E) Output is optimum when AC = MC
Choose the correct answer from the options given below:

Correct Answer: (b) B and D only
Solution:

Imputed cost is a cost that is incurred based on a alternative way of using an asset or taking action instead of investing it. Hence building on rent is an imputed cost.
Average cost is always higher than marginal cost ever MC increases if MC is higher than AC then the firm will face loss hence option b are false statement regarding the short- term theory of production and cost analysis.

6. Which one of the following statements is false?

Correct Answer: (b)
Solution:Coefficient of variation is an important concept that allows you to predict variables with in & outside data sets
So, Z score value of x is the ratio between X is not divided by mean.

7. When the price increase of a commodity is followed by increased total revenue, which of the following is the price elasticity coefficient

Correct Answer: (d) Less than one
Solution:

If the price increase of a commodity is followed by increased total revenue (total expenditure), this shows direct relation so demand will be inelastic hence it is less than one (E < 1)

8. Which of the following cannot use ITR-1 form to file return under the Indian Income Tax Act?

(A) An Individual who is a director in a company.
(B) An individual who has any asset located outside India.
(C) An individual whose total income does not exceed Rs. 50,00,000
(D) An individual who has income from any source outside India
(E) An individual who has any unlisted shares at any time during the previous year
Choose the correct answer from the options given below:

Correct Answer: (b) A, B, D and E only
Solution:

Form ITR 1 is known as "Sahaj"
following are not eligible to file ITR-1 for AY 2022-23

  • ITR -1 cannot be filed by any individual who is a Resident not ordinarily Resident (RNOR) and Not ordinary Resident (NR).
  • has total income exceeding ₹ 50 lakh.
  • has agricultural income exceeding ₹ 5000/-.
  • has income from lottery, racehorses, legal gambling etc.
  • has taxable capital gains (short term and long term).
  • has invested in unlisted equity shares.
  • has income from business or profession.
  • is a Director in a company.
  • has tax deduction under section 194 N of Income Tax Act.
  • has deferred income tax on ESOP received from employer being an eligible start - up.
  • Owns and has income from more than one house property.
  • Is not covered under the eligibility conditions for ITR-1.

9. Given below are two statements

Statement I : The probable error (P.E) of the coefficient of correlation (r) is defined as:
  PE = (1 − r²) / √n
Statement II : When a null hypothesis is true but the statistic rejects it, this known as Type-I error in hypothesis testing
In light of the above statements choose the most appropriate answer from the options given below

Correct Answer: (d) Statement I is incorrect but Statement II is correct
Solution:

Statement I is incorrect because probable error formula is-
  PE = 0.6745 √(1 − r²) / √N
& II statement is correct.

10. Which of the following statements regarding price and output determination under monopoly are correct?

(A) A monopoly firm can fix its price anywhere along its demand curve
(B) Even during short run when a monopoly firm earns normal profit, it produces less than its optimum capacity
(C) The slope of monopoly's MR curve is twice the slope of its AR curve
(D) Price discrimination is possible only when demand curve are identical in two markets
(E) Equilibrium price of a monopolist is always higher than that of a perfectly competitive firm
Choose the correct answer from the options given below :

Correct Answer: (d) B, C and E only
Solution:

In the short run, the monopolist operates in all the three condition of profit normal profit & loss. if a mis-conception that a monopolist always earn profit in the short run whether monopoly will make profit normal profit, loss in the short run depends on the demand curve of the market & the cost condition of the market. A monopoly firm must reduce the price or quantity in order to sell more of it. Also if AR falls MR will also fall, but foster than AR as MR < AR.