Multi-choice 8 Question 1. In the Lewis model of economic development, the sector generates and reinvests surplus and, in turn, absorbs labour withdrawn from the subsistence sector. The process continues till- Answers Option 1 MPL In the capitalist sector is greater than 0 Option 2 MPL in the capitalist sector is less than MPL in the subsistence sector Option 3 MPL = APL in the capitalist sector Option 4 MPL in the capitalist sector is greater than wage rate in that sector and MP, in the subsistence sector is now positive Feedback Wrong choice Incorrect selection Wrong choice Correct option Solution Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Question 2. One of the following statements correctly defines the term Natural Rate of Growth? Answers Option 1 It is the minimum rate at which output can be advanced with full employment of labour Option 2 It is the natural rate at which output can be advanced with full employment of labour Option 3 It is the actual rate at which output can be advanced with full employment of labour Option 4 It is the maximum rate at which output can be advanced with full employment of labour Feedback Wrong choice Incorrect selection Wrong choice Correct option Solution Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Question 3. An underdeveloped economy is generally characterised by a- Answers Option 1 High utilisation of existing capital in the economy Option 2 Coexistence of under-utilised labour with unexploited national and other resources Option 3 High ratio of industrial output to total output Option 4 High ratio of commercial farming to subsistence farming Feedback Wrong choice Correct option Incorrect selection Wrong choice Solution Wrong (Feedback) Correct Option (Feedback) Wrong (Feedback) Wrong (Feedback) Question 4. In the early stages of planning, industrialisation is weighted in favour of consumer goods industries rather than capital goods industries. This hypothesis was advocated by- Answers Option 1 W.G. Hoffmann Option 2 Chenery Option 3 Kuznets Option 4 A. Gerschenkron Feedback Wrong choice Incorrect selection Correct option Wrong choice Solution Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Wrong (Feedback) Question 5. The basic principle emphasised by Harrod and Domar and incorporated in all modern growth theories is the- Answers Option 1 Crowding out effect of net investment Option 2 Saving effect a net investment Option 3 Dual effect of net investment Option 4 Capacity effect of net investment Feedback Wrong choice Incorrect selection Wrong choice Correct option Solution Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Question 6. In the dual economy, as viewed by Lewis, the capitalist sector absorbs the surplus labour provided the- Answers Option 1 Capitalist surplus is generated Option 2 Capitalist surplus is generated and reinvested Option 3 Subsistence sector has an elastic labour supply the capitalist surplus is generated and reinvested Option 4 The subsistence sector has an inelastic labour Feedback Wrong choice Incorrect selection Correct option Wrong choice Solution Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Wrong (Feedback) Question 7. The Physical Quality of Life Index (PQLI) is based on Answers Option 1 Percentage of literacy, infant mortality and life expectancy Option 2 Adequate supply of food, water shelter and health services Option 3 Provision for sanitation, education for all welfare measures Option 4 All of the above Feedback Wrong choice Incorrect selection Wrong choice Correct option Solution Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Question 8. During a recession, consumers typically react to falling incomes by- Answers Option 1 Increasing the fraction of consumption devoted to durable goods Option 2 Replacing worn-out durables quickly before incomes fall further Option 3 Reducing purchases of non-durables and services more quickly than purchases of devoted durables Option 4 Reducing the fraction of consumption devoted to durable goods Feedback Wrong choice Incorrect selection Wrong choice Correct option Solution Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Question 9. Which of the following are true about disguised unemployment? It represents potential savings. The marginal productivity of labour is zero or extremely low. It is due to the existence of joint family system. It is confined to the rural areas. Select the correct answer using the codes given below- Codes: Answers Option 1 I, II, III and IV Option 2 III and IV Option 3 I, II, and III Option 4 I, and IV Feedback Correct option Wrong choice Incorrect selection Wrong choice Solution Correct Option (Feedback) Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Question 10. In Keynes’ General Theory, investment and savings are brought to equality primarily through changes in the- Answers Option 1 Level of prices Option 2 Rate of Interest Option 3 National Income Option 4 Income velocity of money Feedback Wrong choice Incorrect selection Correct option Wrong choice Solution Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Wrong (Feedback)
Multi-choice 8 Question 1. In the Lewis model of economic development, the sector generates and reinvests surplus and, in turn, absorbs labour withdrawn from the subsistence sector. The process continues till- Answers Option 1 MPL In the capitalist sector is greater than 0 Option 2 MPL in the capitalist sector is less than MPL in the subsistence sector Option 3 MPL = APL in the capitalist sector Option 4 MPL in the capitalist sector is greater than wage rate in that sector and MP, in the subsistence sector is now positive Feedback Wrong choice Incorrect selection Wrong choice Correct option Solution Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Question 2. One of the following statements correctly defines the term Natural Rate of Growth? Answers Option 1 It is the minimum rate at which output can be advanced with full employment of labour Option 2 It is the natural rate at which output can be advanced with full employment of labour Option 3 It is the actual rate at which output can be advanced with full employment of labour Option 4 It is the maximum rate at which output can be advanced with full employment of labour Feedback Wrong choice Incorrect selection Wrong choice Correct option Solution Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Question 3. An underdeveloped economy is generally characterised by a- Answers Option 1 High utilisation of existing capital in the economy Option 2 Coexistence of under-utilised labour with unexploited national and other resources Option 3 High ratio of industrial output to total output Option 4 High ratio of commercial farming to subsistence farming Feedback Wrong choice Correct option Incorrect selection Wrong choice Solution Wrong (Feedback) Correct Option (Feedback) Wrong (Feedback) Wrong (Feedback) Question 4. In the early stages of planning, industrialisation is weighted in favour of consumer goods industries rather than capital goods industries. This hypothesis was advocated by- Answers Option 1 W.G. Hoffmann Option 2 Chenery Option 3 Kuznets Option 4 A. Gerschenkron Feedback Wrong choice Incorrect selection Correct option Wrong choice Solution Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Wrong (Feedback) Question 5. The basic principle emphasised by Harrod and Domar and incorporated in all modern growth theories is the- Answers Option 1 Crowding out effect of net investment Option 2 Saving effect a net investment Option 3 Dual effect of net investment Option 4 Capacity effect of net investment Feedback Wrong choice Incorrect selection Wrong choice Correct option Solution Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Question 6. In the dual economy, as viewed by Lewis, the capitalist sector absorbs the surplus labour provided the- Answers Option 1 Capitalist surplus is generated Option 2 Capitalist surplus is generated and reinvested Option 3 Subsistence sector has an elastic labour supply the capitalist surplus is generated and reinvested Option 4 The subsistence sector has an inelastic labour Feedback Wrong choice Incorrect selection Correct option Wrong choice Solution Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Wrong (Feedback) Question 7. The Physical Quality of Life Index (PQLI) is based on Answers Option 1 Percentage of literacy, infant mortality and life expectancy Option 2 Adequate supply of food, water shelter and health services Option 3 Provision for sanitation, education for all welfare measures Option 4 All of the above Feedback Wrong choice Incorrect selection Wrong choice Correct option Solution Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Question 8. During a recession, consumers typically react to falling incomes by- Answers Option 1 Increasing the fraction of consumption devoted to durable goods Option 2 Replacing worn-out durables quickly before incomes fall further Option 3 Reducing purchases of non-durables and services more quickly than purchases of devoted durables Option 4 Reducing the fraction of consumption devoted to durable goods Feedback Wrong choice Incorrect selection Wrong choice Correct option Solution Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Question 9. Which of the following are true about disguised unemployment? It represents potential savings. The marginal productivity of labour is zero or extremely low. It is due to the existence of joint family system. It is confined to the rural areas. Select the correct answer using the codes given below- Codes: Answers Option 1 I, II, III and IV Option 2 III and IV Option 3 I, II, and III Option 4 I, and IV Feedback Correct option Wrong choice Incorrect selection Wrong choice Solution Correct Option (Feedback) Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Question 10. In Keynes’ General Theory, investment and savings are brought to equality primarily through changes in the- Answers Option 1 Level of prices Option 2 Rate of Interest Option 3 National Income Option 4 Income velocity of money Feedback Wrong choice Incorrect selection Correct option Wrong choice Solution Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Wrong (Feedback)
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