Practice test

Basics of economics - Test Set 4

Review 20 exam-focused questions with detailed explanations, then start the interactive test when you are ready.

20 questions

Questions and explanations

  1. Question 1

    An industrial economy is best defined as an economy whose 50% or more produce value comes from the ______ sector.

    1. Banking
    2. Secondary
    3. Tertiary
    4. Primary
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  2. Question 2

    ‘Income and employment theory’ is the other name for which branch of Economics?
    1. International economics
    2. Public finance
    3. Microeconomics
    4. Macroeconomics
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  3. Question 3

    Is defined as the study of behaviour of individual decision-making units, such as consumers, resource owners and firms.
    1. Microeconomics
    2. Macroeconomics
    3. Health economics
    4. Econometrics
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  4. Question 4

    John Maynard Keynes, best known for his economic theories (Keynesian theories), hailed from which country?
    1. Sweden
    2. Denmark
    3. Australia
    4. England
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  5. Question 5

    Which of the following is a possible criticism of privatisation?
    1. Expansion of bureaucracy and efficiency in public enterprises.
    2. Excessive government interference into private businesses.
    3. Limited access to essential services for marginalised populations.
    4. Reduced competition and innovation in the market.
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  6. Question 6

    Which economist took the subject of economics away from approaches that focus exclusively on income, growth, and utility, with an increased emphasis on individual entitlements, capabilities, freedoms, and rights?
    1. Robert Lucas
    2. Amartya Sen
    3. Milton Friedman
    4. Adam Smith
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  7. Question 7

    Which of the following goods needs further transformation in the economic process?
    1. Intermediate goods
    2. Consumer durable goods
    3. Capital goods
    4. Finished goods
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  8. Question 8

    In which form of exchange are goods used as medium of exchange?
    1. Credit exchange
    2. Online exchange
    3. Currency exchange
    4. Barter exchange
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  9. Question 9

    When a person is NOT paying anything for public goods, it is known as ______.
    1. Private good
    2. Non-excludable
    3. Rivalrous
    4. Free rider
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  10. Question 10

    Which of the following is an example of public sector industry in India?

    1. Tata Iron Steel Company
    2. Bajaj Auto
    3. Dabur
    4. Bharat Heavy Electricals Limited
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  11. Question 11

    Which of the following is an example of private sector industry in India?
    1. Bharat Heavy Electricals Limited
    2. Oil India Limited
    3. Steel Authority of India Limited
    4. Tata Iron and Steel Company
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  12. Question 12

    Which of the following is an example of joint sector industry?

    1. Oil India Limited
    2. Tata Iron and Steel Company
    3. Steel Authority of India Limited
    4. Bharat Heavy Electricals Limited
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  13. Question 13

    Which sector of the economy focuses on intellectual activities and innovations?
    1. Unorganised Sector
    2. Secondary Sector
    3. Quaternary Sector
    4. Primary Sector
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  14. Question 14

    National defence, roads, government administration are examples of which type of goods?
    1. Supplementary goods
    2. Private goods
    3. Complementary goods
    4. Public goods
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  15. Question 15

    In a capitalist society the goods produced are distributed among people ______.

    1. On the basis of what people need and on the basis of Purchasing Power
    2. Not on the basis of what people need but on the basis of Purchasing Power
    3. Only on the basis of what people need
    4. Not on the basis of Purchasing Power
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  16. Question 16

    Price mechanism is a feature of:
    1. Capitalist economy
    2. Barter economy
    3. Mixed economy
    4. Socialist economy
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  17. Question 17

    The main feature of a capitalist economy is:
    1. Administered prices
    2. Public ownership
    3. Economic planning
    4. Private ownership
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  18. Question 18

    A camera in the hands of a professional photographer is a ______ good.
    1. Free
    2. Intermediary
    3. Consumer
    4. Capital
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  19. Question 19

    Production of a commodity mostly through the natural process is an activity of:
    1. Primary sector
    2. Secondary sector
    3. Tertiary sector
    4. Technology sector
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  20. Question 20

    According to Keynes, business cycles are due to variation in the rate of investment caused by fluctuations in the:
    1. Marginal efficiency of capital
    2. Marginal propensity to save
    3. Marginal propensity to consumption
    4. Marginal efficiency to investment
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