Roy’s institute of competitive examination

staff selection commission

| Economics |
handout - 1
1. Normally, there will not be a shift in the demand curve when –
a) price of a commodity falls
b) consumers want to buy more at any given price
c) average income rises
d) population grows
2. A market, in which there are a large number of firms, homogeneous product, infinite elasticity of demand for an
individual firm and no control over a price by firms, is terms as –
a) Oligopoly b) Imperfect competition
c) Monopolistic competition d) Perfect competition
3. According to simple Keynesian theory, the slope of the aggregate consumption curve against income is –
a) Positive b) Negative c) Zero d) Infinity
4. Indexation is a method whose use can be associated with which one of the following?
a) Controlling inflation b) Nominal GDP estimation
c) Measurement of savings rate d) Fixing of wage compensation
5. Which of the following statements is/are correct?
1. Indifference curves are convex to the origin.
2. Higher indifference curve represents higher level of satisfaction.
3. Two indifference curves cut each other.
a) Only 1 b) Both 1 and 2 c) Both 2 and 3 d) Only 3
6. When some goods or productive factors are completely fixed in amount regardless of price, the supply curve is –
a) horizontal b) downward sloping to the right
c) vertical d) upward sloping to the right
7. Which of the following was NOT the monopoly of the central Government?
a) Iron and Steel b) Atomic energy c) Railway d) Arms and ammunition
8. According to the law of diminishing marginal utility, as the amount of a good consumed increases, the marginal utility
of that good rends to –
a) Improve b) diminish
c) remain constant d) first diminish and then improve
9. In which of the following case, law of demand fails?
a) Giffen goods b) Normal goods
c) Inferior goods d) Both Giffen and Inferior goods

Rice Education : Head office, Belgharia-DISHARI HOUSE, 11/1 B.T. ROAD, RATHTALA, KOLKATA - 56. (INT24)
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10. 'Neo-Malthusian Theory' is associated with which of the following?
a) Employment b) Poverty c) Resource scarcity d) Income
11. Which among the following is an example of micro-economic variable?
a) National Income b) Aggregate Supply c) Employment d) Consumer's Equilibrium
12. Which of the following is represented by 'Lorenz Curve'?
a) Employment b) Inflation c) Deflation d) Income Distribution
13. ________is the relationship between the variable input and output, keeping all other inputs are held constant.
a) Total product b) Average product c) Isoquant d) The Long Run
14. The collection of all possible combinations of the goods and services that can be produced from a given amount of
resources and a given stock of technological knowledge is called the ___________of the economy
a) Resource Probability Set b) Production Probability Set
c) Resource Possibility Set d) Production Possibility Set
15. _________demand for money arises mainly due to the uncertainty of future receipt and expenses.
a) Transaction b) Generic c) Speculative d) Precautionary
16. The demand for a normal good increases with _________ in the consumer's income.
a) increase b) decrease c) constant d) double
17. Short run marginal cost curve cuts the average variable cost curve from __________ at the minimum point of average
variable cost.
a) top b) below c) right d) left
18. The average variable cost curve is_________ shaped.
a) U b) V c) X d) W
19. _________ refers to money that has already been spent and which can not be recovered.
a) Replacement Cost b) opportunity c) Imported d) Sunk
20. Goods which are consumed together are called–
a) Inferior goods b) Normal goods c) Complementary goods d) Substitute goods
21. Capital deepening refers to –
a) going for more fixed capital per worker b) emphasis on social overhead capital
c) constant capital-output ratio d) increasing capital-output ratio
22. Which of the following brings out the ‘Consumer Price Index Number’ for industrial workers?
a) The Reserve Bank of India b) The Department of Economic Affairs
c) The Labour Bureau d) The Department of Personnel and Training
23. What is meant by 'Public Good'?
a) A commodity produced by government.
b) A commodity whose benefits are indivisibly spread among the entire community.
c) A government scheme that benefits the poor households.
d) Any commodity that is very popular among general public.
24. The law of Increasing Returns means –
a) increasing cost b) decreasing cost c) increasing production d) increasing income
25. Which of the following systems is based on the principle of surplus value?
a) Communism b) Capitalism c) Individualism d) Idealism

Rice Education : Head office, Belgharia-DISHARI HOUSE, 11/1 B.T. ROAD, RATHTALA, KOLKATA - 56. (INT24)
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26. In short run, if a competitive firm incurs losses, it will –
a) stop production
b) continue to produce as long as it can cover its variable costs
c) raise price of its product
d) go far advertising campaign
27. Implicit cost is otherwise called as –
a) imputed cost b) accounting cost c) opportunity cost d) economic cost
28. Quasi rent is a ______ phenomenon.
a) medium term b) long term c) short term d) no time
29. Selling cost is an element of –
a) Monopolistic Competition b) Perfect Competition
c) Pure Competition d) Monopoly
30. Value-added means value of –
a) Output at market prices
b) Goods and services less depreciation
c) Goods and services less cost of intermediate goods and services
d) Output at factor cost
31. Which of the following is not an investment expenditure in goods and services?
a) Purchase of machinery b) An increase in business inventories
c) Expansion of the main plant of a company d) Purchase of a house
32. Forced Savings refers to –
a) Compulsory deposits imposed on income tax payers
b) Provident fund contribution of private sector employees
c) Reduction of consumption consequent to a rise in prices
d) Taxes on individual income income and wealth
33. Diamonds are priced higher than water because –
a) Their total utility to buyers is higher than that of water
b) Consumers do not buy them at lower prices
c) They are sold by selected firms with monopolistic powers
d) Their marginal utility to buyers is higher than that of water
34. The opportunity cost of a factor of production is –
a) what it earns in its present use b) what it can earn in the long period
c) what it can earn in some other use d) the cost of production
35. Which one of the following is not a dimension of the Human Development Index?
a) A long and healthy life b) Knowledge
c) Access to banking and other financial provisions d) A decent standard of living
36. TRIPS Agreement pertains to –
a) international tariff regime b) intellectual property protection
c) international practices of trade facilitation d) international taxation of property
37. ‘Global Financial Stability Report’ is prepared by the –
a) European Central Bank b) International Monetary Fund
c) International Bank for Reconstruction and development d) Organization for Economic Cooperation and Development

Rice Education : Head office, Belgharia-DISHARI HOUSE, 11/1 B.T. ROAD, RATHTALA, KOLKATA - 56. (INT24)
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38. The ‘Uruguay Round’ negotiations resulted in the establishment of –
a) NATO b) OECD c) WHO d) WTO
39. The World Bank and IMF gives ________ respectively.
a) long term and short term credits b) short term and long term credits
c) both long term credits d) both short term credits
40. Which among the following is/are Indian Credit rating agency/agencies?
1. CRISIL 2. CARE 3. ICRA
a) Only 1 and 2 b) Only 2 and 3 c) Only 1 and 3 d) 1, 2 and 3
41. Which one of the following is a component of Food Security System?
a) Buffer stock b) Minimum support price c) Fair price shops d) Mid day meals
42. Match the following :
Term Meaning
1. Globalisation a. Process of reducing or removing restrictions on international trade
2. Privatisation b. Process of interation and integration among the people, companies and government of
different nations
3. Liberalisation c. Called as denationalization or disinvestment
a) 1 - b, 2 - c, 3 - a b) 1 - c, 2 - a, 3 - b c) 1 - a, 2 - c, 3 - b d) 1 - c, 2 - b, 3 - a
43. Courier service comes under which sector?
a) Primary b) Secondary
b) Tertiary d) Both Secondary and Tertiary
44. Which one of the following is an example of a ‘natural monopoly’?
a) Indian Airlines b) Delhi Jal Board
c) Delhi Transport Corporation d) Steel Authority of India Limited
45. Which one among the following industries is the maximum consumer of water in India?
a) Engineering b) Paper and Pulp c) Textile d) Thermal Power
46. Present Industrial policy in India aims at –
a) promoting the private sector units b) increasing the production of public sector units
c) accelerating the performance of mixed economy d) discourage the performance of the private sector
47. BoP (Blance of Payment) refers to –
a) transactions in the flow of capital
b) transactions relating to receipts and payment of invisibles
c) transactions relating only to exports and imports
d) systematic record of all its economic transaction with the rest of the world
48. “Dumping” is a situation when the seller –
a) supplies more than the demand for products in the world market
b) supplies more in the domestic market
c) sells a commodity at a lower price in the world market and charges a higher price in the domestic market
d) sells a commodity at a higher price in the world market and charges a lower price in the domestic market

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Rice Education : Head office, Belgharia-DISHARI HOUSE, 11/1 B.T. ROAD, RATHTALA, KOLKATA - 56. (INT24)