Economic Growth and National Income CDS Questions

CDS Economy

Economic Growth and National Income MCQ Questions


13.
In the water-tank analogy, the amount of water flowing in per minute represents a flow while the amount of water in the tank at a point of time represents a:
A.
Leakage
B.
Stock
C.
Flow
D.
Injection
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ANSWER :
B. Stock
14.
Net Investment is equal to:
A.
Gross investment plus depreciation
B.
Gross investment plus inventories
C.
Depreciation minus gross investment
D.
Gross investment minus depreciation
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ANSWER :
D. Gross investment minus depreciation
15.
Depreciation in national income accounting refers to:
A.
An annual allowance for wear and tear of fixed capital
B.
Fall in the exchange rate of the currency
C.
Loss due to natural calamities
D.
Reduction in the value of money due to inflation
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ANSWER :
A. An annual allowance for wear and tear of fixed capital
16.
If a machine costs Rs 2,00,000 and has an expected useful life of 20 years, the annual depreciation (straight-line) is:
A.
Rs 10,000
B.
Rs 20,000
C.
Rs 5,000
D.
Rs 40,000
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ANSWER :
A. Rs 10,000
17.
In economics, the term 'investment' specifically means:
A.
Putting money in a bank
B.
Purchase of shares and bonds
C.
Addition to the stock of physical capital (capital formation)
D.
Buying an insurance policy
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ANSWER :
C. Addition to the stock of physical capital (capital formation)
18.
The stock of unsold finished goods, semi-finished goods, or raw materials a firm carries from one year to the next is called:
A.
Inventory
B.
Depreciation
C.
Capital
D.
Net investment
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ANSWER :
A. Inventory