Business, Trade and Commerce Test 17

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Business, Trade and Commerce Test 17

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Weekly Quiz Competition

Question 1
1 / -0

Ram : My corn harvest this year is poor.
Krishna : Don't worry. Price increases will compensate for the fall in quantity supplied.
Vinod : Climate affects crop yields. Some years are bad, others are good.
Madhur : The Government ought to guarantee that our income will not fall.
In the conversation the normative statement is made by ______________.

A
Ram

B
Krishna

C
Vinod

D
Madhur

Solution

Normative Statement refers to "What ought to be" or it makes an assessment of an activity and offers advice. Hence the statement made by Madhur is a normative statement.
Question 2
1 / -0

Which of the following is an objective of VAT?

A
To avoid double taxation effect or cascading effect

B
To promote cost-efficiency, by permitting credit on inputs

C
To ensure equitable distribution of tax impact amongst Dealers

D
All of the above

Solution

VAT stands for Value Added Tax. Enactment of VAT on goods has certain objectives:
a) To avoid double taxation effect or cascading effect
b) To promote cost-efficiency, by permitting credit on inputs
c) To ensure equitable distribution of tax impact amongst Dealers
Question 3
1 / -0

As per Indifference Curve Analysis, to maximise his satisfaction, a Consumer will try to _____

A
Remain in the same IC

B
Reduce to lower IC

C
Reach the highest possible IC

D
Reach the Origin point

Solution

Since a higher indifference curve represents a higher level of satisfaction, a consumer will try to reach the highest possible IC to maximize his satisfaction. In order to do so, he has to buy more goods and has to work under the following two constraints: He has to pay the price for the goods and.
Question 4
1 / -0

Which of the following is/are an outcome of a technological change?

A
A downward shift in the production function

B
Same output with fewer inputs or more output with same inputs

C
Invention of a product or production process

D
Both (b) and (c) above

Solution

1) Same output with fewer inputs or more output with same inputs
2) Invention of a product or production process
Both the situations can be defined as an outcome of a technological change as the production rises because of technological advancement in both the situation.
As a result, the production possibility curve will shift to the right.
Question 5
1 / -0

In the pre-reforms period (i.e. before 1991), Import of food grains was permitted ______________.

A
In order to meet domestic demand in case of shortage of foodgrains

B
To help Indians consume nutritious food

C
Whenever there was a favourable Balance of Trade

D
All of the above

Solution

In the pre-reforms period (i.e. before 1991), Import of food grains was permitted in order to meet domestic demand in case of shortage of foodgrains. Demand for food grains by the nation used to fall short in the pre-reform period, hence to cope up with the shortage of food grains, import was done from the foreign countries.
Question 6
1 / -0

In the pre-reforms period (i.e. before 1991), restrictions on import consisted of:

A
Import licenses

B
Quantitative restrictions

C
Quota system

D
All of the above

Solution

India had adopted socialist form of economy before 1991 which involved a lot of government intervention into International trade where import was banned on most of the goods through quota and licenses so that the foreign goods does not dominate domestic market.
Question 7
1 / -0

As part of Economic Reforms in 1991, Financial Sector Reforms relates to :

A
Banking Sector

B
Capital Market Sector

C
Insurance Sector

D
All of the above

Solution

Financial sector reforms relates to reforms in all such sectors where finance was a major and prominent factor which included all the three sector i.e. banking, capital market, and insurance.
Question 8
1 / -0

All of the following developments were noticed during 1991 (when economic reforms were enforced) except one. Identify it.

A
National Debt was nearly 60% of the GNP of India

B
Inflation crossed double digits

C
Foreign Reserves were maintained at a very high level

D
None of the above

Solution

All the following developments ( such as National Debt was nearly 60% of the GNP of India, Inflation crossed double digits) were noticed during 1991, when economic reforms were enforced, except "Foreign Reserves were maintained at a very high level. During 1991, Indian Government adopted New Economic Policy which emphasized liberalization, privatization and globalization.
Question 9
1 / -0

In which of the following situations, the Law of Variable Proportions will not apply?

A
Improvement in technology

B
When all factors are proportionately varied

C
Where the factors must be used in fixed proportions to yield the product

D
All of the above

Solution

In the following situations, the Law of Variable Proportions will not apply:
a) Improvement in technology
b) When all factors are proportionately varied c) Where the factors must be used in fixed proportions to yield the product
Law of variable proportions is also known as the law of law of diminishing returns. This law shows the production function with one input factor variable while keeping the other input factors constant.
Question 10
1 / -0

Which of the following involve a trade-off?

A
Taking a nap.

B
All of these answers involve trade-offs.

C
Watching a football game on Saturday afternoon.

D
Going to university.

Solution

Following situations involve a trade-off :a) Taking a nap
b) Watching a football game on Saturday afternoon
c) Going to university
Trade off refers to any sacrifice to get a certain product or experience. As per the economics term, trade off is referred as opportunity cost, that is, next best alternative use.

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Re-Attempt Weekly Quiz Competition

Business, Trade and Commerce Test 17

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Business, Trade and Commerce Test 17

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SHARING IS CARING

Question 1

Ram

Krishna

Vinod

Madhur

Solution

Question 2

To avoid double taxation effect or cascading effect

To promote cost-efficiency, by permitting credit on inputs

To ensure equitable distribution of tax impact amongst Dealers

All of the above

Solution

Question 3

Remain in the same IC

Reduce to lower IC

Reach the highest possible IC

Reach the Origin point

Solution

Question 4

A downward shift in the production function

Same output with fewer inputs or more output with same inputs

Invention of a product or production process

Both (b) and (c) above

Solution

Question 5

In order to meet domestic demand in case of shortage of foodgrains

To help Indians consume nutritious food

Whenever there was a favourable Balance of Trade

All of the above

Solution

Question 6

Import licenses

Quantitative restrictions

Quota system

All of the above

Solution

Question 7

Banking Sector

Capital Market Sector

Insurance Sector

All of the above

Solution

Question 8

National Debt was nearly 60% of the GNP of India

Inflation crossed double digits

Foreign Reserves were maintained at a very high level

None of the above

Solution

Question 9

Improvement in technology

When all factors are proportionately varied

Where the factors must be used in fixed proportions to yield the product

All of the above

Solution

Question 10

Taking a nap.

All of these answers involve trade-offs.

Watching a football game on Saturday afternoon.

Going to university.

Solution

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