MCQs with Solutions for all Competitive Examinations

Indian Economy MCQ for Competitive Examination

Q. 1
Who is called the father of modern economics?

(A) Max Muller
(B) Karl Marx
(C) Adam Smith
(D) Alfred Marshall

Answer: (C) Adam Smith
Explanation: N/A

Q. 2
Monopoly refers to

(A) Competition among monopolists
(B) Absence of competition
(C) A firm charging different prices to different customers
(D) A market situation in which there is only one buyer of a commodity and one seller

Answer: (B) Absence of competition
Explanation: N/A

Q. 3
Capital Market regulator in India is


Answer: (A) SEBI
Explanation: N/A

Q. 4
Agmark is a gurantee of standard

(A) Quantity
(B) Size
(C) Quality
(D) Weight

Answer: (C) Quality
Explanation: N/A

Q. 5
Money supply is governed by the 

(A) Planning Commission
(B) Finance Commission
(C) Reserve Bank of India
(D) Commercial Bank

Answer: (C) Reserve Bank of India
Explanation: N/A

Q. 6
Regional Rural Banks are sponsored by

(A) Nationalised Commercial Bank
(B) Reserve Bank of India
(C) State Bank of India
(D) Government of India

Answer: (A) Nationalised Commercial Bank
Explanation: N/A

Q. 7
The bank cheques are processed by using 


Answer: (B) MICR
Explanation: Full form of MICR is Magnetic Ink Character Recognition

Q. 8
The monetary policy of India is formulated by

(A) Central Committee
(B) Securities and Exchange Board of India
(C) Reserve Bank of India
(D) Industrial Development Bank of India

Answer: (C) Reserve Bank of India
Explanation: N/A

Q. 9
Nature of unemployment in agriculture in India is 

(A) Seasonal
(B) Disguised
(C) Both (A) and (B)
(D) None of the above

Answer: (C) Both (A) and (B)
Explanation: N/A

Q. 10
Which law states that with constant taste and preferences, the proportion of income spend on food staff diminishes as income increases?

(A) Say’s law
(B) Griffin’s law
(C) Gresham’s law
(D) Engel’s law

Answer: (D) Engel’s law
Explanation: N/A

Q. 11
Micro-economics is also called

(A) Income theory
(B) Investment theory
(C) Price theory
(D) Expenditure theory

Answer: (C) Price theory
Explanation: N/A

Q. 12
Demand in economis means

(A) Aggregate demand
(B) Market demand
(C) Individual demand
(D) Demand backed by purchasing power

Answer: (D) Demand backed by purchasing power
Explanation: N/A

Q. 13
A market in which there are a few number of large firms are called as

(A) Duopoly
(B) Monopoly
(C) Oligopoly
(D) Competition

Answer: (C) Oligopoly
Explanation: N/A

Q. 14
Number of sellers in a monopoly market structure is

(A) Two
(B) One
(C) Many
(D) More than two

Answer: (B) One
Explanation: N/A

Q. 15
Who propounded the Dynamic Theory of Profit?

(A) J.B. Clark
(B) Frank Knight
(C) Hawley
(D) Joseph Schumpeter

Answer: (A)  J. B. Clark
Explanation: N/A

Q. 16
Primary sector of an economy includes

(A) Service sector 
(B) Industrial sector
(C) Manufacturing sector
(D) Agriculture and allied activities

Answer: (D) Agriculture and allied activities
Explanation: N/A

Q. 17
Liquidity preference theory of interest is propounded by

(A) Alfred Marshall
(B) J. M. Keynes
(C) J. S. Mill
(D) I. Fisher

Answer: (B) J. M. Keynes
Explanation: N/A

Q. 18
A portion of an individual’s total income is spent on consumption, the remaining part is called 

(A) Deposits
(B) Savings
(C) Surplus
(D) Excess

Answer: (B) Savings
Explanation: N/A

Q. 19
Open market operation refers to

(A) Borrowing by scheduled banks to industry and trade
(B) Purchase and sale of government securities by the RBI
(C) Deposit mobilisation
(D) Borrowing by scheduled banks from the RBI

Answer: (B) Purchasing and sale of government securities by the RBI
Explanation: N/A

Q. 20
Inflation is caused by

(A) Decrease in production
(B) Increase in money supply and a decrease in production
(C) Increase in money supply
(D) Decrease in production

Answer: (B) Increase in money supply and a decrease in production
Explanation: N/A

Q. 21
The rate at which Reserve Bank of India borrows money from commercial banks is called

(A) Repo Rate
(B) Bank Rate
(C) Reverse Repo Rate
(D) Statutory Liquidity Rate 

Answer: (C) Reverse Repo Rate
Explanation: N/A

Q. 22
NITI Aayog has been formed to replace which of the following institution?

(A) Planning Commission
(B) Department of Telecommunication
(C) Department of Information Technology

Answer: (A) Planning Commission
Explanation: N/A

Q. 23
The market structure called monopoly exists where there is exactly ________________ seller in any market.

(A) 1
(B) 2
(C) 3
(D) 4

Answer: (A) 1
Explanation: N/A

Q. 24
Neo Malthusian Theory‘ is associated with which of the following?

(A) Employment
(B) Poverty
(C) Resource and Scarcity
(D) Income

Answer: (C) Resource and Scarcity
Explanation: N/A

Q. 25
Who introduced the General Equilibrium Theory?

(A) M. Keynes
(B) Leon Walras
(C) David Ricardo
(D) Adam Smith

Answer: (B) Leon Walras
Explanation: N/A

Q. 26
White Revolution is associated with

(A) Sugar
(B) Salt
(C) Cheese
(D) Milk

Answer: (D) Milk
Explanation: N/A

Q. 27
Who is known as the father of the white revolution in India?

(A) Norman Borlaug
(B) Verghese Kurien
(C) M.S. Swaminathan
(D) P.C. Mahalanobis

Answer: (B) Verghese Kurien
Explanation: N/A

Q. 28
An economic system combining private and state enterprise is called

(A) Market Economy
(B) Socialist Economy
(C) Capitalist Economy
(D) Mixed Economy

Answer: (D) Mixed Economy
Explanation: N/A

Q. 29
Value of total goods and services produced in a country is its

(A) Gross National Income
(B) Gross Domestic Products
(C) Per Capita
(D) Total Goods Revenue

Answer: (B) Gross Domestic Products
Explanation: N/A

Q. 30
Which among the following is a characteristic of Laissez-Faire system?

(A) No Government Intervention
(B) Market is highly regulated
(C) It is a socialist system
(D) Maximum Government Intervention

Answer: (A) No Government Intervention
Explanation: N/A

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