1.Which type of economy is characterized by social ownership of the means of production?
A) Capitalist Economy
B) Mixed Economy
C) Socialist Economy
D) Traditional Economy
Answer: C) Socialist Economy
2.In which type of economy is the allocation of resources primarily determined by the state?
A) Market Economy
B) Socialist Economy
C) Mixed Economy
D) Capitalist Economy
Answer: B) Socialist Economy
3.Which countries are examples of socialist economies?
A) USA, UK
B) USSR, China
C) India, Japan
D) Brazil, South Africa
Answer: B) USSR, China
4.In a mixed economy, ownership of industry is typically:
A) Completely private
B) Completely public
C) Both public and private
D) By foreign investors
Answer: C) Both public and private
5.Which type of economy is based on private ownership of the means of production?
A) Socialist Economy
B) Mixed Economy
C) Traditional Economy
D) Capitalist Economy
Answer: D) Capitalist Economy
6.The USA, UK, and France are examples of which type of economy?
A) Socialist Economy
B) Mixed Economy
C) Capitalist Economy
D) Traditional Economy
Answer: C) Capitalist Economy
7.Which type of economy features both free markets and economic planning?
A) Socialist Economy
B) Mixed Economy
C) Capitalist Economy
D) Traditional Economy
Answer: B) Mixed Economy
8.India’s economy is best described as:
A) Purely capitalist
B) Purely socialist
C) Mixed with economic planning
D) Traditional
Answer: C) Mixed with economic planning
9.Free-market interventionism is associated with which type of economy?
A) Capitalist Economy
B) Socialist Economy
C) Mixed Economy
D) Traditional Economy
Answer: C) Mixed Economy
10.In a capitalist economy, who primarily controls the means of production?
A) The government
B) Private individuals and businesses
C) Non-profit organizations
D) Community groups
Answer: B) Private individuals and businesses
11.What is the primary mechanism for resource allocation in a socialist economy?
A) Market forces
B) Government planning
C) Consumer preferences
D) Foreign investment
Answer: B) Government planning
12.Public ownership of industry is most closely associated with which type of economy?
A) Capitalist Economy
B) Mixed Economy
C) Socialist Economy
D) Traditional Economy
Answer: C) Socialist Economy
13.In a mixed economy, what role does the government play?
A) None, it leaves everything to the market
B) It controls all aspects of the economy
C) It regulates and intervenes where necessary
D) It only controls the financial sector
Answer: C) It regulates and intervenes where necessary
14.Which type of economy typically has the highest level of economic freedom?
A) Capitalist Economy
B) Socialist Economy
C) Mixed Economy
D) Traditional Economy
Answer: A) Capitalist Economy
15.Economic planning is a characteristic feature of which economies?
A) Capitalist and Mixed
B) Socialist and Mixed
C) Socialist and Traditional
D) Capitalist and Traditional
Answer: B) Socialist and Mixed
16.Which type of economy is characterized by minimal government intervention in the markets?
A) Socialist Economy
B) Mixed Economy
C) Capitalist Economy
D) Traditional Economy
Answer: C) Capitalist Economy
17.Public-private partnerships are a hallmark of which type of economy?
A) Capitalist Economy
B) Socialist Economy
C) Mixed Economy
D) Traditional Economy
Answer: C) Mixed Economy
18.In which type of economy would you expect to find state-owned enterprises?
A) Capitalist Economy
B) Socialist Economy
C) Mixed Economy
D) Traditional Economy
Answer: B) Socialist Economy
19.Economic equality is a primary goal in which type of economy?
A) Capitalist Economy
B) Socialist Economy
C) Mixed Economy
D) Traditional Economy
Answer: B) Socialist Economy
20.Market-based economies rely on which mechanism to allocate resources?
A) Government directives
B) Market forces
C) Community consensus
D) Foreign investment
Answer: B) Market forces
21.What type of economy does India have?
A) Capitalist
B) Socialist
C) Mixed
D) Traditional
Answer: C) Mixed
22.In a mixed economy, what entities coexist alongside the private sector?
A) Non-profits
B) Foreign enterprises
C) Public sector (government-owned) business enterprises
D) Informal sector businesses
Answer: C) Public sector (government-owned) business enterprises
23.What are the twin objectives guiding India’s economic development since independence?
A) Rapid technological progress and political stability
B) Economic growth and environmental sustainability
C) Rapid technological progress and social justice
D) Industrialization and urbanization
Answer: C) Rapid technological progress and social justice
24.Which sector in a mixed economy like India’s aims to achieve a welfare state?
A) Private sector
B) Public sector
C) Foreign sector
D) Informal sector
Answer: B) Public sector
25.What does the Indian economy aim to offer to every citizen?
A) Wealth
B) Equal opportunity
C) Free education
D) Free healthcare
Answer: B) Equal opportunity
26.India’s economic development aims to be achieved by what means?
A) Authoritarian means
B) Democratic means
C) Capitalist means
D) Communist means
Answer: B) Democratic means
27.The goal of India’s economic development includes creating a social order based on what principle?
A) Wealth accumulation
B) Justice
C) Military power
D) Political dominance
Answer: B) Justice
28.What type of pattern does India aim to create in its society through its mixed economy?
A) Capitalist pattern
B) Traditional pattern
C) Socialistic pattern
D) Technocratic pattern
Answer: C) Socialistic pattern
29.Which of the following sectors is significant in India’s mixed economy?
A) Public sector only
B) Private sector only
C) Both public and private sectors
D) Informal sector only
Answer: C) Both public and private sectors
30.What aspect is essential for India’s economic development apart from rapid technological progress?
A) Urban development
B) Social order based on justice
C) Political stability
D) Population control
Answer: B) Social order based on justice
31.India’s approach to economic development includes fostering which of the following?
A) Free market principles
B) Isolationist policies
C) Inclusive growth
D) Authoritarian governance
Answer: C) Inclusive growth
32.India’s public sector aims to ensure what type of distribution of resources?
A) Unequal
B) Just and equitable
C) Market-driven
D) Random
Answer: B) Just and equitable
33.The private sector in India is expected to contribute towards what?
A) Only profit maximization
B) Social justice and welfare
C) Only technological advancements
D) Political campaigns
Answer: B) Social justice and welfare
34.What is a major characteristic of India’s mixed economy?
A) Complete government control
B) Complete market freedom
C) Balance between public and private enterprises
D) Only small-scale industries
Answer: C) Balance between public and private enterprises
35.India’s economic policy aims to integrate what type of technological approach?
A) Outdated technology
B) Rapid and progressive technology
C) Limited technological use
D) Manual labor-intensive technology
Answer: B) Rapid and progressive technology
36.What fundamental rights are emphasized in India’s economic development model?
A) Right to property
B) Right to work
C) Equal opportunity and justice
D) Right to privacy
Answer: C) Equal opportunity and justice
37.Which sectors are particularly targeted by India’s public sector investments?
A) Real estate and luxury goods
B) Defense and heavy industry
C) Basic infrastructure and public services
D) Entertainment and media
Answer: C) Basic infrastructure and public services
38.The private sector in India’s mixed economy is encouraged to:
A) Ignore social responsibilities
B) Work independently of the government
C) Collaborate with the public sector for societal welfare
D) Focus solely on international markets
39.Answer: C) Collaborate with the public sector for societal welfare
Which of the following is a key feature of India’s approach to economic development?
A) State monopoly on all industries
B) Laissez-faire economics
C) Democratic means and social justice
D) Minimal government intervention
Answer: C) Democratic means and social justice
40.What has been a consistent goal of India’s economic policies since independence?
A) Increasing population growth
B) Reducing technological advancements
C) Achieving rapid economic growth and social justice
D) Expanding military capabilities
Answer: C) Achieving rapid economic growth and social justice
41.Which sector is primarily involved in agriculture and allied activities?
A) Secondary Sector
B) Tertiary Sector
C) Primary Sector
D) Quaternary Sector
Answer: C) Primary Sector
42.What does the primary sector of the Indian economy include?
A) Manufacturing and Construction
B) Trade and Transport
C) Agriculture, Forestry, Fishing, Mining & Quarrying
D) Banking and Insurance
Answer: C) Agriculture, Forestry, Fishing, Mining & Quarrying
43.Which of the following activities is part of the primary sector?
A) Real Estate
B) Electricity Supply
C) Mining
D) Transport
Answer: C) Mining
44.Forestry falls under which sector of the Indian economy?
A) Secondary Sector
B) Tertiary Sector
C) Primary Sector
D) Quaternary Sector
Answer: C) Primary Sector
45.Which of the following is not included in the primary sector?
A) Fishing
B) Agriculture
C) Banking
D) Mining
Answer: C) Banking
46.Which sector is known as the industrial sector?
A) Primary Sector
B) Secondary Sector
C) Tertiary Sector
D) Quaternary Sector
Answer: B) Secondary Sector
47.Which activity is part of the secondary sector?
A) Transport
B) Manufacturing
C) Trade
D) Real Estate
Answer: B) Manufacturing
48.Electricity, Gas, and Water Supply fall under which sector?
A) Primary Sector
B) Secondary Sector
C) Tertiary Sector
D) Quaternary Sector
Answer: B) Secondary Sector
49.What does the secondary sector focus on?
A) Providing services
B) Producing goods
C) Agriculture and Mining
D) Real Estate
Answer: B) Producing goods
50.Which of the following activities is associated with the secondary sector?
A) Storage
B) Construction
C) Banking
D) Communication
Answer: B) Construction
51.Which sector is responsible for providing services that help in production?
A) Primary Sector
B) Secondary Sector
C) Tertiary Sector
D) Quaternary Sector
Answer: C) Tertiary Sector
52.Trade, Hotels, and Restaurants are part of which sector?
A) Primary Sector
B) Secondary Sector
C) Tertiary Sector
D) Quaternary Sector
Answer: C) Tertiary Sector
53.Which sector includes activities like transport and storage?
A) Primary Sector
B) Secondary Sector
C) Tertiary Sector
D) Quaternary Sector
Answer: C) Tertiary Sector
54.Banking and Insurance are categorized under which sector?
A) Primary Sector
B) Secondary Sector
C) Tertiary Sector
D) Quaternary Sector
Answer: C) Tertiary Sector
55.Which sector is focused on community, social, personal, and other services?
A) Primary Sector
B) Secondary Sector
C) Tertiary Sector
D) Quaternary Sector
Answer: C) Tertiary Sector
56.What is the role of the primary sector in the Indian economy?
A) Manufacturing goods
B) Providing services
C) Extracting natural resources
D) Managing financial transactions
Answer: C) Extracting natural resources
57.The secondary sector is often referred to as which of the following?
A) Service sector
B) Industrial sector
C) Agricultural sector
D) Financial sector
Answer: B) Industrial sector
58.Which sector is crucial for infrastructure development?
A) Primary Sector
B) Secondary Sector
C) Tertiary Sector
D) Quaternary Sector
Answer: B) Secondary Sector
59.Which sector would likely include activities related to IT services?
A) Primary Sector
B) Secondary Sector
C) Tertiary Sector
D) Quaternary Sector
Answer: C) Tertiary Sector
60.Which of the following sectors provides services that support other sectors of the economy?
A) Primary Sector
B) Secondary Sector
C) Tertiary Sector
D) Quaternary Sector
Answer: C) Tertiary Sector
61.What is the projected per capita income for India by the year 2047?
A) ₹12.5 lakh
B) ₹14.9 lakh
C) ₹16.2 lakh
D) ₹18.0 lakh
Answer: B) ₹14.9 lakh
62.As of the fiscal year 2023-24, what is India’s per capita income?
A) ₹1.5 lakh
B) ₹2.12 lakh
C) ₹2.50 lakh
D) ₹3.0 lakh
Answer: B) ₹2.12 lakh
63.Which country is currently ranked ahead of India in terms of the largest economy?
A) UK
B) France
C) Germany
D) Brazil
Answer: C) Germany
64.What is the estimated size of India’s GDP as of the current fiscal year?
A) USD 2.5 trillion
B) USD 3.0 trillion
C) USD 3.6-3.7 trillion
D) USD 4.0 trillion
Answer: C) USD 3.6-3.7 trillion
65.Which year saw India’s GDP growth rate of 8.7 percent?
A) 2022-23
B) 2021-22
C) 2023-24
D) 2020-21
Answer: B) 2021-22
66.What is the projected growth rate for India in the fiscal year 2024-25?
A) 5.0-5.5 percent
B) 6.5-7.0 percent
C) 7.5-8.0 percent
D) 8.5-9.0 percent
Answer: B) 6.5-7.0 percent
67.Which institution is not mentioned as having projected India’s growth in the range of 6.6-7.2 percent?
A) IMF
B) OECD
C) World Bank
D) European Central Bank
Answer: D) European Central Bank
68.In which year did India surpass the UK to become the fifth largest economy?
A) 2021
B) 2022
C) 2023
D) 2024
Answer: B) 2022
69.What was the GDP growth rate for India in the financial year 2023-24?
A) 7.2 percent
B) 8.2 percent
C) 6.5 percent
D) 8.7 percent
Answer: B) 8.2 percent
70.Who presented the Economic Survey for 2023-24?
A) Prime Minister Narendra Modi
B) Finance Minister Nirmala Sitharaman
C) Chief Economic Adviser V Anantha Nageswaran
D) Reserve Bank Governor Shaktikanta Das
Answer: C) Chief Economic Adviser V Anantha Nageswaran
71.Which growth rate was observed in India during the fiscal year 2022-23?
A) 6.5 percent
B) 7.2 percent
C) 8.2 percent
D) 8.7 percent
Answer: B) 7.2 percent
72.What is the main economic goal projected for India by 2047?
A) Achieve a per capita income of ₹20 lakh
B) Become the world’s largest economy
C) Reach a per capita income of ₹14.9 lakh
D) Attain a GDP of USD 5 trillion
Answer: C) Reach a per capita income of ₹14.9 lakh
73.Which of the following is not a measure to achieve the per capita income target by 2047?
A) Sustained economic reforms
B) Increased investment in infrastructure
C) Implementation of new tax laws
D) Continued efforts to foster a favorable business environment
Answer: C) Implementation of new tax laws
74.Which country’s economic size is India currently trailing behind?
A) Japan
B) Brazil
C) Canada
D) South Korea
Answer: A) Japan
75.What has been a key factor in the rise of India’s per capita income in recent years?
A) Increase in foreign aid
B) Robust economic growth
C) Decrease in population
D) Higher levels of taxation
Answer: B) Robust economic growth
76.What fiscal policy aspect was emphasized by the Economic Survey 2023-24?
A) Higher interest rates
B) Faster fiscal deficit reduction
C) Increased taxation on high-income individuals
D) Enhanced spending on social welfare
Answer: B) Faster fiscal deficit reduction
77.Which global institutions have projected India’s growth to be in the range of 6.6-7.2 percent?
A) IMF, ADB, and OECD
B) World Bank, S&P, and Fitch
C) UN, World Economic Forum, and ECB
D) ADB, IMF, and BIS
Answer: B) World Bank, S&P, and Fitch
78.What is the significance of achieving a per capita income of ₹14.9 lakh by 2047?
A) It marks the 75th anniversary of India’s independence
B) It signifies an optimistic economic future and improved living standards
C) It aligns with the global average per capita income
D) It completes the government’s 5-year plan
Answer: B) It signifies an optimistic economic future and improved living standards
79.What is the approximate per capita income in India as of the fiscal year 2023-24 in USD?
A) USD 2,000
B) USD 2,500
C) USD 3,000
D) USD 3,500
Answer: B) USD 2,500
80.Which fiscal year saw the highest GDP growth rate in the past decade?
A) 2020-21
B) 2021-22
C) 2022-23
D) 2023-24
Answer: B) 2021-22
81.What does national income measure?
A) The total stock of commodities in a country
B) The total value of goods and services produced in a country during a year
C) The financial assets held by a country
D) The income earned only within the domestic boundaries
Answer: B) The total value of goods and services produced in a country during a year
82.Which concept of national income measures the amount of money earned per person?
A) Gross National Product (GNP)
B) Net National Product (NNP)
C) Per Capita Income
D) Gross Domestic Product (GDP)
Answer: C) Per Capita Income
83.How is Per Capita Income calculated?
A) National Income × Population
B) National Income / Population
C) GDP / Population
D) GNP / Population
Answer: B) National Income / Population
84.What does Gross National Product (GNP) include that Gross Domestic Product (GDP) does not?
A) Income earned by foreign nationals within the country
B) Income from the sale of assets
C) Income earned by nationals outside the country
D) Depreciation
Answer: C) Income earned by nationals outside the country
85.Which equation represents the relationship between GNP and GDP?
A) GNP = GDP + M
B) GNP = GDP + X
C) GNP = GDP – X
D) GNP = GDP + NFIA
Answer: D) GNP = GDP + NFIA
86.What is Net Factor Income from Abroad (NFIA)?
A) Factor incomes paid to abroad
B) Factor incomes received from abroad minus factor incomes paid to abroad
C) Total domestic income
D) Total foreign investments
Answer: B) Factor incomes received from abroad minus factor incomes paid to abroad
87.In a closed economy, what is the relationship between GNP and GDP?
A) GNP = GDP + NFIA
B) GNP = GDP
C) GNP = GDP – NFIA
D) GNP = GDP + X
Answer: B) GNP = GDP
88.Which measure focuses on the total output produced within the geographical boundaries of a country?
A) GNP
B) GDP
C) NNP
D) PCI
Answer: B) GDP
89.If the income earned by nationals outside the country equals the income received by foreign nationals within the country, what is the relationship between GNP and GDP?
A) GNP = GDP + 0
B) GNP = GDP
C) GNP = GDP + NFIA
D) GNP = GDP – 0
Answer: B) GNP = GDP
90.Which of the following would be excluded from GDP?
A) Income earned by domestic nationals abroad
B) Income earned by foreign nationals within the country
C) Income from domestic sales
D) Income from domestic investments
Answer: B) Income earned by foreign nationals within the country
91.What does GDP measure in terms of geographical boundaries?
A) Total national wealth
B) Total foreign income
C) Total output within the country’s geographical boundaries
D) Total income received from abroad
Answer: C) Total output within the country’s geographical boundaries
92.Which national income concept emphasizes the productive power of an economy over a given period?
A) National Wealth
B) National Income
C) GDP
D) Per Capita Income
Answer: B) National Income
93.Which of the following is true about a closed economy with no foreign transactions?
A) GDP will be less than GNP
B) GNP will be less than GDP
C) GDP will equal GNP
D) GNP will be zero
Answer: C) GDP will equal GNP
94.In calculating GNP, which of the following is added to GDP?
A) Domestic income
B) Factor income received from abroad
C) Income earned by foreign nationals
D) Taxes paid to the government
Answer: B) Factor income received from abroad
95.Which national income concept includes net earned foreign income?
A) Per Capita Income
B) Gross Domestic Product (GDP)
C) Gross National Product (GNP)
D) Net National Product (NNP)
Answer: C) Gross National Product (GNP)
96.What is the key difference between national income and national wealth?
A) National income is a stock measure; national wealth is a flow measure
B) National income measures the stock of commodities; national wealth measures the flow of goods and services
C) National income measures the flow of goods and services; national wealth measures the stock of commodities
D) National income includes only domestic production; national wealth includes international production
Answer: C) National income measures the flow of goods and services; national wealth measures the stock of commodities
97.What does a rise in Per Capita Income generally indicate?
A) Increase in population
B) Decrease in overall national income
C) Improvement in living standards
D) Reduction in GDP
Answer: C) Improvement in living standards
98.Which measure is often used to compare the economic performance of different countries on a per person basis?
A) GNP
B) GDP
C) Per Capita Income
D) Net National Product
Answer: C) Per Capita Income
99.Which of the following does not directly affect Per Capita Income?
A) National Income
B) Population
C) Inflation rate
D) GDP
Answer: C) Inflation rate
100.If a country’s factor income paid to abroad is higher than the factor income received from abroad, what happens to GNP relative to GDP?
A) GNP is greater than GDP
B) GNP is less than GDP
C) GNP equals GDP
D) GNP cannot be determined
Answer: B) GNP is less than GDP
101.What does Net National Product (NNP) measure?
A) The total value of final goods and services produced by a country
B) The total value of final goods and services produced minus depreciation
C) The total income earned by nationals abroad
D) The stock of capital goods in the economy
Answer: B) The total value of final goods and services produced minus depreciation
102.Which equation correctly represents NNP?
A) NNP = GNP + Depreciation
B) NNP = GNP – Depreciation
C) NNP = GDP – Depreciation
D) NNP = GDP + Depreciation
Answer: B) NNP = GNP – Depreciation
103.What is the relationship between NNP and National Income when NNP is calculated at market prices?
A) National Income = NNP at market prices – Indirect Taxes
B) National Income = NNP at market prices – Depreciation
C) National Income = NNP at market prices – (Indirect Taxes – Subsidy)
D) National Income = NNP at market prices + Indirect Taxes
Answer: C) National Income = NNP at market prices – (Indirect Taxes – Subsidy)
104.When NNP is calculated at factor cost, it is equivalent to which of the following?
A) Gross National Product (GNP)
B) Net Domestic Product (NDP)
C) National Income
D) Gross Domestic Product (GDP)
Answer: C) National Income
105.Which of the following is subtracted from Gross National Product (GNP) to calculate Net National Product (NNP)?
A) Taxes
B) Subsidies
C) Depreciation
D) Interest
Answer: C) Depreciation
106.What is the formula to calculate National Income from NNP at market prices?
A) National Income = NNP(mp) + Indirect Taxes – Subsidies
B) National Income = NNP(mp) – Depreciation
C) National Income = NNP(mp) – Indirect Taxes + Subsidies
D) National Income = NNP(mp) + Depreciation
Answer: C) National Income = NNP(mp) – Indirect Taxes + Subsidies
107.If the total indirect taxes are ₹500 crore and subsidies are ₹200 crore, what is the adjustment to calculate National Income from NNP at market prices?
A) ₹300 crore
B) ₹700 crore
C) ₹200 crore
D) ₹500 crore
Answer: A) ₹300 crore
108.Which value is subtracted to obtain NNP from GNP?
A) Taxes
B) Subsidies
C) Depreciation
D) Interest
Answer: C) Depreciation
109.National Income can be obtained by subtracting which from NNP at market prices?
A) Depreciation
B) Net Indirect Taxes
C) Gross Indirect Taxes
D) Subsidies
Answer: B) Net Indirect Taxes
110.Which of the following best describes NNP at factor cost?
A) It includes indirect taxes and subsidies
B) It is equivalent to Gross National Product
C) It is National Income
D) It includes the value of depreciation
Answer: C) It is National Income
111.What does NNP at market prices include that NNP at factor cost does not?
A) Depreciation
B) Taxes
C) Subsidies
D) Both taxes and subsidies
Answer: D) Both taxes and subsidies
112.Which concept is used to adjust NNP at market prices to get National Income?
A) Net Indirect Taxes
B) Gross Depreciation
C) Net Subsidies
D) Gross National Product
Answer: A) Net Indirect Taxes
113.What happens to NNP if depreciation increases while GNP remains constant?
A) NNP increases
B) NNP decreases
C) NNP remains the same
D) NNP becomes negative
Answer: B) NNP decreases
114.How does the inclusion of subsidies affect NNP at factor cost compared to NNP at market prices?
A) It makes NNP at factor cost higher
B) It makes NNP at factor cost lower
C) It has no effect on NNP at factor cost
D) It changes the value of depreciation
Answer: B) It makes NNP at factor cost lower
115.Which of the following is not used in calculating NNP at market prices?
A) Depreciation
B) Indirect Taxes
C) Subsidies
D) Factor Income
Answer: D) Factor Income
116.What is the impact of increasing indirect taxes on National Income if NNP at market prices remains constant?
A) National Income increases
B) National Income decreases
C) National Income remains the same
D) National Income becomes negative
Answer: B) National Income decreases
117.If NNP at market prices is ₹1,000 crore, indirect taxes are ₹300 crore, and subsidies are ₹100 crore, what is the National Income?
A) ₹900 crore
B) ₹1,000 crore
C) ₹1,200 crore
D) ₹1,100 crore
Answer: A) ₹900 crore
118.Which of the following is not included in the calculation of NNP?
A) Depreciation
B) Net Factor Income from Abroad
C) Indirect Taxes
D) Subsidies
Answer: B) Net Factor Income from Abroad
119.In the context of national income, what does subtracting depreciation from GNP accomplish?
A) It calculates GDP
B) It determines the Net Domestic Product
C) It calculates NNP
D) It determines the Per Capita Income
Answer: C) It calculates NNP
120.How does NNP at factor cost relate to the overall economic measure of a country?
A) It provides a measure of the economy’s total stock of wealth
B) It measures the flow of goods and services including indirect taxes and subsidies
C) It reflects the income received by factors of production within a country
D) It is equivalent to the total market value of all final goods and services produced
Answer: C) It reflects the income received by factors of production within a country
121.What does Personal Income measure?
A) The income available to corporations
B) The income received by individuals after taxes and social security
C) The total value of goods and services produced by a country
D) The income of a country’s government
Answer: B) The income received by individuals after taxes and social security
122.Which of the following is subtracted from National Income to calculate Personal Income?
A) Government transfer payments
B) Business transfer payments
C) Corporate taxes
D) Net interest paid by the government
Answer: C) Corporate taxes
123.Which of the following is added to National Income to determine Personal Income?
A) Undistributed profits of corporations
B) Payments for social security provisions
C) Government transfer payments
D) Direct taxes
Answer: C) Government transfer payments
124.How is Personal Disposable Income (DPI) calculated?
A) Personal Income – Direct Taxes
B) National Income – Direct Taxes
C) Gross National Product – Direct Taxes
D) Net National Product – Direct Taxes
Answer: A) Personal Income – Direct Taxes
125.What does the formula “Personal Income = National Income – Undistributed Profits of Corporations – Payments for Social Security Provisions – Corporate Tax + Government Transfer Payments + Business Transfer Payments + Net Interest Paid by Government” represent?
A) Gross National Product
B) Net National Product
C) Personal Income
D) Disposable Personal Income
Answer: C) Personal Income
126.Which of the following is NOT included in the calculation of Personal Income?
A) Government transfer payments
B) Undistributed profits of corporations
C) Payments for social security provisions
D) Personal savings
Answer: D) Personal savings
127.What impact does a decrease in corporate taxes have on Personal Income?
A) It decreases Personal Income
B) It increases Personal Income
C) It has no impact on Personal Income
D) It decreases Disposable Personal Income
Answer: B) It increases Personal Income
128.If Personal Income is ₹10,00,000 and direct taxes are ₹2,00,000, what is the Disposable Personal Income?
A) ₹8,00,000
B) ₹10,00,000
C) ₹12,00,000
D) ₹2,00,000
Answer: A) ₹8,00,000
129.Which of the following is NOT a component in the calculation of Personal Income?
A) Net transfer payments
B) Net interest paid by the government
C) Direct taxes
D) Corporate taxes
Answer: C) Direct taxes
130.When calculating Personal Income, which of the following is subtracted?
A) Business transfer payments
B) Government transfer payments
C) Corporate taxes
D) Net interest paid by the government
Answer: C) Corporate taxes
131.What is the formula for Disposable Personal Income?
A) DPI = Personal Income + Direct Taxes
B) DPI = Personal Income – Direct Taxes
C) DPI = National Income – Indirect Taxes
D) DPI = Personal Income + Indirect Taxes
Answer: B) DPI = Personal Income – Direct Taxes
132.How do net transfer payments affect Personal Income?
A) They are subtracted from Personal Income
B) They are added to Personal Income
C) They have no effect on Personal Income
D) They are subtracted from Disposable Personal Income
Answer: B) They are added to Personal Income
133.Which of the following does NOT affect Disposable Personal Income?
A) Corporate taxes
B) Direct taxes
C) Government transfer payments
D) Undistributed profits of corporations
Answer: D) Undistributed profits of corporations
134.What happens to Personal Income if the government increases its transfer payments?
A) Personal Income decreases
B) Personal Income remains unchanged
C) Personal Income increases
D) Personal Income becomes zero
Answer: C) Personal Income increases
135.In the formula for Personal Income, what does “Net Interest Paid by Government” refer to?
A) Interest paid on government loans
B) Interest earned by the government on loans
C) Net interest received from government bonds
D) Net interest received from foreign investments
Answer: A) Interest paid on government loans
136.Which component is subtracted from National Income to calculate Personal Income?
A) Net factor income from abroad
B) Payments for social security provisions
C) Gross investment
D) Government subsidies
Answer: B) Payments for social security provisions
137.What is the impact of increasing direct taxes on Disposable Personal Income?
A) It increases Disposable Personal Income
B) It decreases Disposable Personal Income
C) It has no impact on Disposable Personal Income
D) It increases Personal Income
Answer: B) It decreases Disposable Personal Income
138.If Personal Income is ₹5,00,000 and the net interest paid by the government is ₹50,000, what is the adjusted Personal Income?
A) ₹5,50,000
B) ₹4,50,000
C) ₹5,00,000
D) ₹5,50,000
Answer: A) ₹5,50,000
139.Which of the following is used to adjust National Income to find Personal Income?
A) Net Indirect Taxes
B) Undistributed Profits of Corporations
C) Net Factor Income from Abroad
D) Gross Investment
Answer: B) Undistributed Profits of Corporations
140.In the context of Personal Income, what does the term “undistributed profits” refer to?
A) Profits distributed to shareholders
B) Profits retained by corporations
C) Profits paid as dividends
D) Profits received from foreign investments
Answer: B) Profits retained by corporations
141.What is the primary focus of the Product Method of measuring National Income?
A) Total income earned by workers
B) Net value of final goods and services produced
C) Total consumption and savings
D) Government expenditure
Answer: B) Net value of final goods and services produced
142.Which method of measuring National Income involves summing total rent, wages, interest, and profits?
A) Product Method
B) Income Method
C) Consumption Method
D) Expenditure Method
Answer: B) Income Method
143.In the Income Method, which of the following is NOT included in the calculation?
A) Total Rent
B) Total Wages
C) Total Government Expenditure
D) Total Profit
Answer: C) Total Government Expenditure
144.Which formula represents the Consumption Method of calculating National Income?
A) National Income = C + I + G + (X – M)
B) National Income = Total Rent + Total Wages + Total Interest + Total Profit
C) National Income = GDP + Depreciation – Net Factor Income from Abroad
D) National Income = C + I + G
Answer: A) National Income = C + I + G + (X – M)
145.In the Product Method, what is added to Gross Domestic Product (GDP) to get National Income?
A) Total Wages
B) Depreciation
C) Net Income earned abroad
D) Total Consumption
Answer: C) Net Income earned abroad
146.What is subtracted from Gross Domestic Product (GDP) in the Product Method to calculate National Income?
A) Depreciation
B) Net Factor Income from Abroad
C) Total Investment
D) Total Consumption
Answer: A) Depreciation
147.Which method of measuring National Income focuses on the total expenditure on consumption and investment?
A) Product Method
B) Income Method
C) Consumption Method
D) Expenditure Method
Answer: D) Expenditure Method
148.In the Expenditure Method, what does ‘I’ represent in the formula N.I = C + I + G + (X – M)?
A) Total Consumption
B) Total Government Expenditure
C) Total Investment Expenditure
D) Net Factor Income from Abroad
Answer: C) Total Investment Expenditure
149.Which method is primarily used in India for estimating National Income?
A) Product Method
B) Income Method
C) Consumption Method
D) Combination of Production and Income Methods
Answer: D) Combination of Production and Income Methods
150.What does the symbol ‘C’ stand for in the formula for National Income using the Expenditure Method?
A) Total Investment Expenditure
B) Total Government Expenditure
C) Total Consumption Expenditure
D) Total Net Exports
Answer: C) Total Consumption Expenditure
151.In the Income Method, which component represents the returns to capital?
A) Total Wages
B) Total Rent
C) Total Interest
D) Total Profit
Answer: C) Total Interest
152.What is the role of ‘X – M’ in the Expenditure Method of calculating National Income?
A) To adjust for changes in interest rates
B) To account for net exports (exports minus imports)
C) To include government subsidies
D) To adjust for depreciation
Answer: B) To account for net exports (exports minus imports)
153.Which of the following is NOT a component of the Income Method?
A) Rent
B) Wages
C) Interest
D) Net Exports
Answer: D) Net Exports
154.In the Product Method, what does GDP stand for?
A) Gross Domestic Product
B) Gross Development Product
C) Gross Domestic Production
D) Gross Domestic Profit
Answer: A) Gross Domestic Product
155.What is the result of subtracting depreciation from Gross National Product (GNP)?
A) Gross Domestic Product (GDP)
B) Net National Product (NNP)
C) Personal Income
D) Disposable Income
Answer: B) Net National Product (NNP)
156.In the formula N.I = C + I + G + (X – M), what does ‘G’ represent?
A) Total Consumption Expenditure
B) Total Government Expenditure
C) Total Investment Expenditure
D) Net Factor Income from Abroad
Answer: B) Total Government Expenditure
157.What is included in National Income calculation using the Income Method?
A) Taxes
B) Subsidies
C) Wages, Rent, Interest, and Profits
D) Consumption Expenditure
Answer: C) Wages, Rent, Interest, and Profits
158.Which method of calculating National Income focuses on the value added at each production stage?
A) Income Method
B) Consumption Method
C) Product Method
D) Expenditure Method
Answer: C) Product Method
159.Which of the following is subtracted when calculating National Income from GDP using the Product Method?
A) Net Factor Income from Abroad
B) Total Investment
C) Total Consumption
D) Depreciation
Answer: D) Depreciation
160.What does ‘M’ stand for in the formula N.I = C + I + G + (X – M)?
A) Total Consumption Expenditure
B) Total Government Expenditure
C) Total Imports
D) Total Exports
Answer: C) Total Imports
