1. If the marginal propensity to consume is greater than marginal propensity to save, the value of the multiplier will be ……………… . (Fill up the blank with correct alternative) (a) Greater than 2 (b) Less than 2 (c) Equal to 2 (d) Equal to 1
2. Ms. Nikita, an Economics teacher, was discussing the concepts of following with the students. “Make in India programme will cause rise in _________ of foreign exchange and hence _________ in the current balance of payment situation of the country.” (Fill up the blank with correct alternative) a) Supply, degradation b) Demand, improvement c) Supply, improvement d) Demand, degradation
3. Which of the following is an example of capital expenditure of the government? (Choose the correct alternative) (a) Expenditure on the acquisition of land, building, machinery and equipment. (b) Investment in shares. (c) Loans and advances by the central government to state and union territory governments, PSUs and other parties. (d) All of the above.
4. Read the following statements carefully: Statement 1: Autonomous investment increases with increase in the level of income in an economy. Statement 2: Induced investment changes with change in the rate of interest and income level in an economy.
In the light of the given statements, choose the correct alternative from the following: a) Statement 1 is true and statement 2 is false. b) Statement 1 is false and statement 2 is true. c) Both statements 1 and 2 are true. d) Both statements 1 and 2 are false.
5. Read the following statement -Assertion (A) and Reason (R). Choose one of the correct alternatives given below: Assertion (A) ;The monetary policy is a policy formulated by the central bank. Reason(R); This policy involves measures taken to regulate the supply of money, availability, and cost of credit in the economy.
Alternatives: a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A). b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A). c) Assertion (A) is true but Reason (R) is false. d) Assertion (A) is false but Reason (R) is true.
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