CHANAKYA GROUP OF ECONOMICS MOCK TEST

CHANAKYA GROUP OF ECONOMICS MOCK TEST 4

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Paper 1

1. The type of research that involves looking at variables over an extended period of

time is known as:

A. Cross-sectional B. Time series

C. Longitudinal D. Latitudinal

2. Time spent on studying causes a change in test score. Which kind of variable is ‘test

score’?

A. Dependent B. Independent

C. None D. Both A and B

3. Which of the following statement/s about the Applied research is/are correct?

I. Applied research is used to solve a practical problem.

II. It can be used to solve problems of education system of the developing countries.

III. Applied research is action-oriented.

IV. Applied research is also called fundamental research.

A. Only I B. I and II

C. I, II and III D. None

4. The format of thesis writing is the same as in

A. preparation of a research paper/article

B. writing of seminar presentation

C. a research dissertation

D. presenting a workshop / conference paper A. B. C. D.

5. Which sequence of research steps is logical in the list given below?

A. Problem formulation, Analysis, Development of Research design, Hypothesis making,

Collection of data, Arriving at generalizations and conclusions.

B. Development of Research design, Hypothesis making, Problem formulation, Data

analysis, Arriving at conclusions and data collection.

C. Problem formulation, Hypothesis making, Development of a Research design, Collection

of data, Data analysis and formulation of generalizations and conclusions.

D. Problem formulation, Deciding about the sample and data collection tools, Formulation of

hypothesis, Collection and interpretation of research evidence.

6. Arrange the list in correct order as per their usage in the article writing.

A. Abstract, Topic, Discussion, Method, Bibliography

B. Topic, Discussion, Method, Abstract, Bibliography

C. Topic, Abstract, Method, Discussion, Bibliography

D. Topic, Abstract, Discussion, Method, Bibliography

7. In which of the following activities, potential for nurturing creative and critical

thinking is relatively greater?

A. Preparing research summary

B. Presenting a seminar paper

C. Participation in research conference

D. Participation in a workshop


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8. From the list given below identify the learner characteristics which would facilitate

teaching learning system to become effective. Choose the correct code to indicate your

answer.

1) Prior experience of learner

2) Learner’s family lineage

3) Aptitude of the learner

4) Learner’s stage of Development

5) Lerner’s food habits and hobbies

6) Learner’s religious affiliation

A. 1, 3 and 4 B. 4, 5 and 6

C. 1, 4 and 5 D. 2, 3 and 6

9. Which among the following is the best field of study to improve the ability of students

to experiment and analyse?

A. Economics B. History

C. Science D. Languages

10. Which of the following characteristics do not belong to an effective teacher/teaching.

Identify the correct option.

A. A teacher is effective if he/she has full confidence of the subject

B. Teaching is always in a formal manner.

C. Teaching is a continuous process

D. Teaching is an interaction between teacher and students

11. In which teaching method learner’s participation is made optimal and proactive?

A. Discussion method B. Buzz session method

C. Brainstorming session method D. Project method

12. Assertion (A): Formative evaluation tends to accelerate the pace of learning.

Reason (R): As against summative evaluation, formative evaluation is highly reliable.

Choose the correct answer from the following code:

A. Both (A) and (R) are true and (R) is the correct explanation of (A).

B. Both (A) and (R) are true, but (R) is not the correct explanation of (A).

C. (A) is true, but (R) is false.

D. (A) is false, but (R) is true.

13. Suppose as a teacher you are training your students in public speaking and debate.

Which among the following is most difficult to develop among the students?

A. Using/Selecting appropriate language

B. Control over emotions

C. Voice modulation

D. Concept formulation

14. Which among the following reflects best the quality of teaching in a classroom?

A. Through the use of many teaching aids in the classroom

B. Through full attendance in the classroom

C. Through the quality of questions asked by students in classroom

D. Through observation of silence by the students in classroom

15. One of the most powerful factors affecting teaching effectiveness is related to the:


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A. Social system of the country

B. Economic status of the society

C. Prevailing political system

D. Educational system

16. In the series 1, 6, 15, 28, 45, ............ the next term will be:

A. 66 B. 76

C. 56 D. 84

17. The next term in the series ABD, DGK, HMS, MTB, .......... is :

A. NSA B. SBL

C. PSK D. RUH

18. Ajay is a friend of Rakesh. Pointing to an old man Ajay asked Rakesh who is he?

Rakesh said “His son is my son’s uncle”. The old man is related to Rakesh as:

A. Grandfather B. Father-in-law

C. Father D. Uncle

19. A postman walked 20 m straight from his office, turned right and walked 10 m.

After turning left he walked 10 m and after turning right walked 20 m. He again turned

right and walked 70 m. How far he is from his office?

A. 50 m. B. 40 m

C. 60 m. D. 20 m.

20. Consider the following statements with respect to C-Sat-Fi technology

1. It is based on the optimal utilization of wireless and satellite communication to extend

connectivity to the unserved areas.

2. It does not require Satellite Phones and can work on any WiFi enabled phone.

Which of the statement(s) given above is/are correct?

A. 1 only B. 2 only

C. Both 1 and 2 D. Neither 1 nor 2

21. Consider the following statements with respect to Group of Seven (G7)

1. It is an intergovernmental organisation formed as an informal forum to discuss pressing

world issues.

2. The G7 nations meet at annual Summits that are presided over by leaders of member

countries on a rotational basis.

3. India participated in the 45th annual summit of G7 held in Biarritz, France.

Which of the statement(s) given above is/are correct?

A. 3 only B. 1 and 2 only

C. 2 and 3 only D. 1, 2 and 3

22. Clouded Leopard National Park is located in which state?

A. Jammu & Kashmir

B. Uttarakhand

C. Sikkim

D. Tripura


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23. One of the major objectives of the National Water Mission is to increase the water

use efficiency by 20%. Which among the following is the correct definition of the water

use efficiency?

A. Increase the ground water level by proper management of rainwater

B. To make the irrigation facilities to maximum crop areas

C. To save water from evaporation and runoff or subsurface drainage

D. To make bodies of water clean and usable for drinking purpose

24. In a conditional proposition, the part which expresses the condition by ‘if’ or its equivalent is

(a) Antecedent (b) Consequent

(c) Opposite (d) Meaning

25.Which of the following terms describe the syllogism? A. Mediate and deductive

B. Immediate and deductive

C. Mediate and inductive

D. Immediate inductive

Read the following passage carefully and answer questions.

Singapore has long advocated for India to take up its role as an integral part of the region. It

is gratifying to see how ASEAN – India relations have grown during the past 25 years. In

1991, when the Cold War ended and India began its economic liberalization, Singapore saw

on opportunity to deepen ties and build on its historical and cultural links with the Asian

region. Singapore pushed for India to become a full ASEAN dialogue partner in 1995 and

join the EAS in 1995 and since then, ASEAN – India ties have strengthened. All in all,

around 30 platforms for co-operation exist, including seven ministerial dialogues and the

Annual Leader Summit. However, there is scope for more and it is a must. For instance, there

are tremendous opportunities in enhancing physical and digital connectivity between India

and ASEAN. ASEAN is committed to strengthening land, air and sea linkages with India.

These linkages will enhance people-to-people flows, as well as boost business, investment

and tourism. The India-Myanmar Thailand trilateral highway will connect India’s Northeast

to mainland Southeast Asia. While one can fly directly between India and several ASEAN

countries, there is still much room to expand air links to support growing business and

tourism. Beyond physical linkages, digital connectivity is the new frontier in the Fourth

Industrial Revolution. India has made great progress in innovation, Start-ups and digital

inclusion. There are opportunities to apply initiatives such as Aadhaar in our region. E

commerce and FinTech are two other areas of potential collaboration. As an economic hub,

Singapore can serve as a springboard to lunch these ideas to Southeast Asia and beyond.

India’s role in ASEAN should be anchored by growing economic ties with Singapore. The

economic integration involving 16 countries with one-third of global GDP and trade will

create an integrated Asian market.

26. The areas of collaboration between India and ASEAN are:

(a) Fin Tech

(b) Aadhaar

(c) E-commerce

(d) Digital backwardness

(e) Trilateral highways


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(f) Fourth Industrial Revolution

A. (a), (c), (e) and (f) B. (a), (b), (c) and (d)

C. (c), (d), (e) and (f) D. (b), (c), (d) and (e)

27. What prompted Singapore to opt for stronger ties with India?

A. End of Cold War B. Economic liberalization in India

C. Historical past D. Geo-political equations

28. What is needed to encourage tourism between India and ASEAN?

A. Waterways B. Air links

C. Innovation D. Start-ups

29. The commitment of ASEAN with India is:

A. Hold leadership summits B. Offer political platforms

C. More and more dialogues D. Improving transport links

30. Who can be India’s Launchpad for an integrated Asian market as per the passage?

A. Southeast Asia B. Myanmar

C. Thailand D. Singapore

31. In which year Education Commission under the Chairmanship of Dr. DS. Kothari

was set up?

A. 1960 B. 1955

C. 1952 D. 1964

32. As per the latest data released by UGC, how many state universities are there in

India?

A. 789 B. 123

C. 364 D. 260

33. When was the University Education Commission constituted?

A. November 4, 1947 B. November 4, 1948

C. November 4, 1949 D. November 4, 1950

34. Communicative abilities embrace which of the following skills?

A. Linguistic skills B. Semantic skills

C. Cultural skills D. Both a & b

35. Non-verbal communication is considered:

A. Informal B. Precise

C. Culture-free D. Formal

36. The rhetorical approach in classroom communication considers teachers as______

agents of students.

A. Non-official B. Official

C. Influencing D. Academic

37. The classroom communication should essentially be:

A. Contrived B. Empathetic


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C. Abstract D. Non-descriptive

Directions : Study the following bar chart carefully and answer the questions 38-42

given beside.

The bar graph below shows the production (in numbers) and sales (in numbers) of

refrigerators by five different factories in a month.

Note: Inventory (in numbers) = Production (in numbers) – Sales (in numbers)

38. Find the total number of refrigerators produced by all the given factories in a

month.

A. 3156 B. 3268

C. 3376 D. 3298

39. For which factory, the percentage sales is maximum with respect to the production?

A. Factory A B. Factory B

C. Factory D D. Factory E

40. Find the ratio of the total sales (in number) of the factory A, C and D together to the

total sales (in number) of the factory B and E together.

A. 351:313 B. 119:112

C. 257:213 D. 357:313

41. For which factory, the inventory (in numbers) is the second highest?

A. Factory A B. Factory B


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C. Factory C D. Factory E

42. If 5% and 1.25% of the refrigerators produced by factory A and factory E

respectively is found to be defective, then find the percentage of non-defective

refrigerators produced by factory A and E together with respect to the total

refrigerators produced by all the given factories. A. 37.4 % B. 41.5 %

C. 45.7 % D. None of these

43. What are the barriers to effective communication?

A. Moralising, being judgemental and comments of consolation.

B. Dialogue, summary and self-review.

C. Use of simple words, cool reaction and defensive attitude.

D. Personal statements, eye contact and simple narration

44. A small text file stored on user’s computer by some websites in order to recognize

and keep track of user’s preferences is called:

A. Log B. Report

C. Cookie D. History

45. _______denotes an error in a computer program. program.

A. Bit B. Bug

C. Spam D. Virus

46. The output quality of a printer is measured by:

A. Digits per inch B. Dots per mm

C. Dots per inch D. Dots per cm

47. Two earthquakes A and B happen to be of magnitude 5 and 6 respectively on

Richter Scale. The ratio of the energies released 𝑬𝑩/𝑬𝑨 will be approximately:

A. ∼ 8 B. ∼ 16

C. ∼ 32 D. ∼ 64

48. Inside rural homes, the source/sources of Nitrogen Oxide Pollution may be:

1) Unvented gas stoves

2) Wood stoves

3) Kerosene heaters

Choose the correct code:

A. 1 and 2 only B. 2 and 3 only

C. 2 only D. 1, 2 and 3

49. Which school of Indian does not admit inference as a means of valid knowledge A. Samkhya B. Buddhist

C. Jainism D. Charvakya

50. Agama comes under

A. Sabda

B. Perception

C. Inference

D. None of these


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Paper 2

1. Marx refers to the concept of organic composition of capital. Which of the following

ratios stands for this capital? Constant capital = C; Variable capital = V; Surplus value

= S

a. C/(V+S) b. C/V

c. C/(C+V) d. (C+V)/V

2. Assertion: Devaluation in general is resorted to increase the exports.

Reason: It makes exports cheaper.

A. Both A and R are correct.

B. A is correct, but R is not correct

C. Both A and R are incorrect.

D. A is incorrect, but R is correct.

3. Inventory-theoretic approach to transactions demand for money has been given by

A. J.M. Keynes

B. Milton Friedman

C. Don Patinkin

D. W.J. Baumol

4. Which one of the following is an indicator of poverty?

A. Head-count index

B. Poverty gap ratio

C. Poverty square gap ratio

D. All of the above

5. In 1971, collapse of Brettonwood system was largely due to

A. Fall of gold standard

B. Rise in the value of gold.

C. Failure to manage international liquidity

D. Surplus countries did not revalue and deficit countries did not devalue their currencies.

6. The incidence of sales tax is on the seller when the demand curve

A. for the product is a rectangular hyperbola

B. for the product is perfectly elastic

C. for the product is perfectly inelastic

D. for the product is moderately elastic.

7. The sum of the squares of deviations of the given set of observations is minimum

when taken from

A. Mode

B. Median

C. Variance

D. Mean

8. With which of the following is the doctrine of excess capacity in the long run not

associated?


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A. Monopoly

B. Oligopoly

C. Monopolistic competition

D. Perfect competition

9. The premise that there exists inverse relationship between money wage inflation and

unemployment was originally given by

A. A.W. Phillips

B. Milton Friedman

C. Philip Cagan

D. Robert Lucas

10. Which one of the following is not an instrument of fiscal policy?

A. Public Revenue

B. Public Expenditure

C. Public Borrowing

D. Cash Reserve Ratio

11. For Rostow, which of the following constitute pre-conditions for take-off?

a. Investment rate of at least 5% of GNP

b. Universal primary education

c. Development of one or more manufacturing sectors with a high growth rate

d. Both A and B

12. The second stage of the theory of demographic transition is characterised by:

a. High birth-rate and high death rate

b. High birth-rate and falling death-rate

c. Low birth-rate and low death-rate

d. Falling birth-rate and falling death-rate

13. In HDI, which one of the following is not taken as an indicator?

A. Life expectancy

B. Literacy

C. GDP per capita

D. Per capita food consumption

14. Shift in LM curve takes place due to

A. Increase in autonomous investment

B. Increase in money supply

C. Increase in consumption

D. Increase in saving rate

15. Raul Prebisch’s argument is concerned with the effects of business cycles on

A. Terms of Trade

B. Balance of Payments

C. Output

D. Consumption

16. Assertion: Life Cycle Hypothesis attempts to reconcile the short-run non-proportional

and the long run proportional consumption functions.


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Reason: Short run non-proportional consumption function implies that APC declines as

income increases.

A. A is true, but R is false.

B. Both A and R are false.

C. Both A and R are true, but R is not the correct reason of A.

D. Both A and R are true, and R is the correct reason of A.

17. Assertion: Colin Clark hypothesised that the safe upper limit of taxation is 25 per cent of

national income.

Reason: The excess burden of taxation will be very high if it goes beyond the 25 percent

limit.


B. Both A and R are true.

C. Both A and R are true, and R is the correct explanation of A.

D. Both A and R are false.

18. Indicative Planning is

A. Rigid

B. Comprehensive

C. Autocratic

D. Flexible

19. Borrowings from foreigners are known as

A. Export of goods

B. Unrequited receipts

C. Capital receipts

D. Current receipts

20. Assertion: Duessenberry hypothesised that consumption-income relationship is

irreversible.

Reason: Consumption depends not only on current income but also on previous peak

income.

A. Both A and R are true and R is the correct explanation of A.

B. Both A and R are true, but R is not the correct explanation of A.

C. A is true, but R is false.

D. Both A and R are false.

21. Assertion: James Buchanan viewed that primary burden of public debt is shifted to

posterity.

Reason: Public debt is paid by taxing the posterity.


B. A is false, but R is true.

C. Both A and R are false.

D. Both A and R are true and R is the correct explanation of A.

22. According to Milton Friedman quantity theory of money is the theory of

A. Prices

B. Income

C. Demand for money

D. Supply of money


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23. For the first time in India zero base budgeting was implemented in the finance

ministership of

A. P. Chidambaram

B. Manmohan Singh

C. V.P. Singh

D. Jaswant Singh

24. Which of the following models makes the assumption of constant saving-income

ratio? a. Kaldor model

b. Leontief model

c. Harrod-Domar model

d. Joan Robinson model

25. Assertion: One brand of non-neutral terminal progress is as good as the other, in the

context of models of steady state growth.

Reason: The elasticity of substitution of production function equals one.

A. Both A and R are false.

B. Both A and R are true.

C. A is true, R is false

D. A is false, R is true.

26. Assertion: Z test is applied to test for mean of population for large sample.

Reason: All distributions obey central limit theorem.

A. Both A and R are true and R is the correct explanation of A.

B. Both A and R are true, but R is not the correct explanation of A.


D. A is false, but R is true.

27. When interest elasticity of demand for money is zero the LM curve is

A. Vertical parallel to Y axis

B. Horizontal parallel to X axis

C. Positive sloping straight line.

D. Negative sloping straight line.

28. To avoid the excess burden of tax, we should have

A. low marginal tax rate

B. zero marginal tax rate

C. moderate marginal tax rate

D. reasonable marginal tax rate

29. Assertion: An individual values mean return on investment, but dislikes variance.

Reason: Individuals are generally averse to risk.

A. Both A and R are true and R is the correct reason.

B. Both A and R are true but R is not the correct reason.


D. A is false, but R is true.


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30. Assertion: Global income inequality has shown an increase in trend.

Reason: Prebisch-Singer propounded a secular decline in the terms of trade for primary

producers and exporters.

A. A is false, but R is true.

B. Both A and R are false.

C. Both A and R are true and R is the correct reason.

D. Both A and R are true but R is not the correct explanation.

31. Unemployment created by some long-term change in demand or technological

conditions in an economy is known as:

a. Frictional unemployment

b. Cyclical un-employment

c. Structural unemployment

d. Disguised unemployment

32. Attempts to force inflation below non-accelerating inflation rate of unemployment

(NAIRU) will cause:

A. inflation to accelerate without any change in employment or output.

B. inflation to decelerate with rising employment and output.

C. inflation to decelerate with employment and output remaining the same.

D. inflation to remain unchanged with fall in employment and output.

33. Which one of the following aspects was NOT emphasised by Hirschman in the

theory of unbalanced growth?

A. Backward and forward linkages.

B. Direct productive activities

C. Social overhead capital

D. Equilibrium in different sectors

34. Which one of the following is NOT included in a capital budget?

A. Expenditure on asset formation

B. Interest payments

C. Money collected from public borrowing

D. Small saving collection by the government

35. According to the Romer model, if the stock of ideas increases by 15 %, by how much

will output per worker increase, when all else is equal?

a. 5%

b. 10% c. 15%

d. 20%

36. A bag contains 7 red, 12 white and 4 green balls. One ball is drawn from the bag.

What is the chance that it is white?

A. 12/23

B. 7/23

C. 4/23


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D. 23/12

37. If the firms are behaving on the basis of average cost principle, orderly co-

ordination is often attained by

A. Price leadership

B. Price cutting

C. High cost firm

D. None of the above

38. Sen’s measure of poverty includes:

A. the head count ratio

B. the head count ratio and the poverty gap ratio

C. the poverty gap ratio and the distribution of income among the poor.

D. the head count ratio, the poverty gap ratio, and the distribution of income among the poor.

39. According to Dalton, the total social advantage becomes maximum when taxation

and expenditure are carried to a point where:

A. Marginal Social Sacrifice > Marginal Social Benefit

B. Marginal Social Sacrifice < Marginal Social Benefit

C. Marginal Social Sacrifice = Marginal Social Benefit


40. In Stackelberg’s model of duopoly, if both sellers act as followers, we then have:

A. Cournot solution

B. A price war between sellers

C. A situation of disequilibrium

D. Collusion between sellers

41. It follows from the assumption of rational expectation hypothesis that

A. most unemployment is voluntary

B. monetary policy can work in the short run.

C. fiscal policy can work in the short run

D. all policies that are predictable are ineffective.

42. According to Solow, the long run rate of growth in an advanced economy equals

Harrod’s

A. Natural rate of Growth

B. Warranted Rate of Growth

C. Actual Rate of Growth

D. Warranted Rate of Technical Progress

43. The per-worker production function assumes

A. constant returns to scale and increasing marginal returns.

B. constant returns to scale and diminishing marginal returns.

C. increasing returns to scale and diminishing marginal returns.

D. decreasing returns to scale and diminishing marginal returns.

44. In the face of a stagnant economy, a government should

A. spend more, tax less and/or pursue and contractionary monetary policy.

B. spend less, tax less and/or pursue an expansionary monetary policy.


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C. spend more, tax less and/or pursue an expansionary monetary policy.

D. tax more, spend less and/or pursue an expansionary monetary policy.

45. If one of two countries has an absolute advantage in the production of every

commodity, then

A. there is no comparative advantage and therefore no trade.

B. trade would benefit efficient country but not the inefficient one.

C. trade would benefit inefficient country, but not the efficient one.

D. none of the above

46. The chain base indices are not suitable for:

A. Long range comparisons

(b) Short range comparisons

(c) Percentages

(d) Ratios

47. In the Sweezy model of Oligopoly, an increase in demand will make upper portion of

the demand curve

A. More elastic

B. Less elastic

C. Unitary elastic


48. The most comprehensive measure of the aggregate price level is the

A. consumer price index

B. producer price index

C. GNP deflator

D. wholesale price index

49. The trade-off between inflation and unemployment remains stable only

A. during periods of stagflation

B. when the inertial rate of inflation remain unchanged

C. during the periods of slack demand

D. in the long run.

50. Capital per person decreases if net investment per person:

A. is less than the population growth rate.

B. exceeds the population growth rate

C. exceeds savings per person

D. is less than savings per person.

51. Which of the following will result in an increase in interest rate?

A. The government increasing its defence expenditure.

B. RBI selling bonds through open market operations.

C. RBI releasing high powered money into the economy.

D. The government decreasing the tax rate.

52. If a country faces consistent inflation what could be the impact on the exchange

rate?

A. The exchange rate of the country appreciates with respect to other countries.

B. The exchange rate of the country depreciates with respect to other countries.


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C. The exchange rate of the country is not affected.


53. The Economic Survey 2019-20 has projected how much GDP Growth for fiscal year

2020-21?

a) 5-5.5 percent

b) 6-6.5 percent

c) 5-6 percent

d) 5-6.5 percent

54. According to The Economic Survey 2019-20, how much India needs to spend on

infrastructure to become USD 5 trillion economy by 2024-25?

a) USD 1.2 trillion

b) USD 1.4 trillion

c) USD 1.6 trillion

d) USD 1.8 trillion

55. India and China jointly submitted a proposal to the WTO calling for the

elimination, by the developed countries, of the most trade – distorting form of farm

subsidies, known in WTO parlance as

A. Amber Box

B. Green Box

C. White Box

D. Red Box

56. The “Fiscal Monitor” report is prepared twice in a year by

A. United Nations Organisation

B. World Bank

C. International Monetary Fund

D. World Economic Forum

57. Which country has tabled the “Concept Note for an initiative on Trade Facilitation

in Services” at the World Trade Organisation?

A. Japan

B. India

C. China

D. Brazil

58. Gross National Product – Depreciation allowance =

A. Personal Income

B. GDP

C. Per Capita Income

D. NNP

59. Which among the following statements is not true when there is an increase in

interest rate in an economy?

A. Increase in savings

B. Decrease in loan

C. Increase in production cost

D. Increase in capital return.


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60. If people’s income of a country is denoted in a curved line space that it has

increased, then what does it denote?

A. To raise the bank loan

B. Decline in savings rate

C. Decline in productivity

D. Increased demand of consumer products

61. One of the essential conditions of perfect competition is

A. Product differentiation

B. Multiplicity of prices for identical products at any time.

C. Many sellers and a few buyers.

D. Only one price for identical goods at any one time.

62. Devaluation usually causes the internal prices to

A. fall

B. rise

C. remain unchanged


63. Which unit of valuation is known as “Paper Gold”?

A. Eurodollar

B. Petrodollar

C. SDR

D. GDR

64. In a business, raw materials, components, work in progress and finished goods are

jointly regarded as

A. capital stock

B. inventory

C. investment

D. net worth

65. NIFTY is associated with

A. Cloth Market Price Index

B. Consumer Price Index

C. BSE Index

D. NSE Index

66. Who among the following suggested tax on expenditure?

A. Dalton

B. Kaldor

C. Musgrave

D. Gautam Mathur

67. Indian Railways HP Electric Locomotive is manufactured as a joint venture between

India and

A. Japan

B. France

C. Germany


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D. U.S.A

68. NABARD is associated with the development of

A. agricultural sector and rural areas

B. heavy industries

C. banking sector

D. real estates

69. Which of the following is not considered as National Debt?

A. National Savings Certificates

B. Long-term Government Bonds

C. Insurance Policies

D. Provident Fund

70. Which of the following is not included in the National Income?

A. Imputed rent of owner-occupied houses

B. Government expenditure on making new bridges

C. Winning a lottery

D. Commission paid to an agent for sale of house.

71. Who prepared the first estimate of National Income for the country?

A. Central Statistic Organisation

B. National Income Committee

C. Dadabhai Naoraji

D. National Sample Survey Organisation

72. A situation where we have people whose level of income is not sufficient to meet the

minimum consumption expenditure is considered as

A. Absolute Poverty

B. Relative Poverty

C. Urban Poverty

D. Rural Poverty

73. Full convertibility of a rupee means

A. Purchase of foreign exchange for rupees freely.

B. Payment for imports in terms of rupees

C. Repayment of loans in terms of rupees.

D. Determination of rate of exchange between rupee and foreign currencies freely by the

market forces of demand and supply.

74. Foreign currency which has a tendency of quick migration is called

A. Hot money

B. Soft money

C. SDR

D. Call money

75. The monetary policy in India is formulated by

A. Central Government

B. Industrial Financial Corporation of India

C. Reserve Bank of India

D. Industrial Development Bank of India


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76. A short-term government security paper is called

A. Share

B. Debenture

C. Mutual fund

D. Treasury bill

77. What does the term “Green Shoots” represents in an economy?

A. Signs of growth of agriculture sector in a growing economy.

B. Signs of economic recovery during an economic downturn.

C. Signs of growth of agriculture sector in a declining economy.

D. Signs of economic decline in a developed economy.

78. For a Cobb Douglas Production Function Q =100 𝑳𝟎.𝟕𝑲𝟎.𝟑, which of the following is

not true?

A. It is characterized by unit elasticity of substitution.

B. It is characterized by constant returns to scale.

C. It is a linear homogeneous function.

D. It has zero elasticity of factor substitution.

79. Which of the following statements is not correct about the National Service Scheme

(NSS) in India?

A. It is an experiment scheme for academic work expansion through the voluntary

contribution by the students and teachers.

B. It was launched in Swami Vivekanand’s birth Centenary year, 1963.

C. It is funded by both the Union Government and the State governments.

D. At national level, the Ministry of Youth affairs and Sports is the planning and monitoring

authority of the Scheme.

80. Two series are given as under

I. 1 −1

2+

1

4+

1

8+

1

16+

1

32+ ⋯ 𝑢𝑝𝑡𝑜 𝛼

II. 2 + √2 +1

√2+

1

2+

1

2√2+ ⋯ 𝑢𝑝𝑡𝑜 𝛼

A. I) and II) are convergent series

B. I) is convergent while II) is divergent series

C. I) is divergent while II) is convergent series

D. Neither I) nor II) are convergent

81. Consider a two-sector economy. Output has settled in equilibrium at the level where

the injections line, J, intersects the withdrawals line, W. Which of the following

statements is false?

A. An increase in autonomous consumption will shift W downwards.

B. An increase in induced consumption would make the W line flatter.

C. An increase in injections will shift the J line upwards.

D. If either line shifts upwards, the equilibrium level of output will increase

82. Which of the following is the most appropriate reason behind growth in regional per

capita income disparities in India?

A. Decline in the share of public investments


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B. Poor governance and poor infrastructure

C. Allocation of funds through the award of finance commission.

D. Discriminatory investment policy regimes of government.

83. Indian financial system has provided for the transfer of resources from the centre to

the states, the important means of resources transfer is/are

A. tax sharing

B. grants-in-aid

C. loans

D. all of the above

84. Demographic Dividend refers to a rise in population

A. between the age group of 6-14 years.

B. between the age group of 15-64 years.

C. between the age group of 65-74 years.

D. above 74 years

85. Two large countries currently impose tariffs against each other. Each country would

be better off with free trade. Which of the following statements are true?

1. Each country might think 'if the other country maintains its tariff, we will be better off

maintaining our tariff.'

2. Each country may think 'if the other country unilaterally abolishes its tariff, we may be

better off maintaining our tariff.

A. Both 1 and 2

B. 1 only

C 2 only

D. Neither 1 nor 2

86. The restructured Technology Up-gradation Fund Scheme is for which of the

following sector?

A. Pharmaceuticals

B. Textiles

C. Automobiles

D. Information Technology

87. Suppose a large country imposes a tariff on a good. Which of the following

statements is false?

A. The total consumer plus producer surplus decreases.

B. The price for consumers rises from the pre-tariff situation by the amount of the tariff.

C. If other countries do not retaliate, the country may be better off.

D. If other countries do not retaliate, the country may be worse off.

88. Which of the following is NOT correct regarding ‘Pradhan Mantri Fasal Bima

Yojna’?

A. The farmers’ premium has been kept at a maximum of 2 per cent for foodgrains and

oilseeds, and up to 5 per cent for horticulture and cotton crops.


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B. The scheme will be implemented by public and private insurance companies.

C. The scheme will cover only pre-harvest crop losses.

D. There will be exemption from Service Tax liability of all the services involved in the

implementation of the scheme.

89. NAMA is associated with?

A. World Bank

B. World Trade Organisation

C. International Monetary Fund

D. NAFTA

90. Which of the following assumptions are required to show the consistency,

unbiasedness and efficiency of the OLS estimator?

i) E(𝑢𝑡) = 0

ii) Var(𝑢𝑡) = σ 2

ii) Cov(𝑢𝑡, 𝑢𝑡−𝑗) = 0 and j

iv) 𝑢𝑡~ N(0, σ²)

A. ii and iv only B. i and iii only

C. i, ii, and iii only D. i, ii, iii and iv

91. Which of the following may be consequences of one or more of the CLRM

assumptions being violated?

i) The coefficient estimates are not optimal

ii) The standard error estimates are not optimal

iii) The distributions assumed for the test statistics are inappropriate

įv) Conclusions regarding the strength of relationships between the dependent and

independent variables may be invalid.

A. ii and iv only B. i and iii only

C. i, ii, and iii D. i,ii,iii and iv.

92.What is the meaning of the term "heteroscedasticity"?

A. The variance of the errors is not constant

B. The variance of the dependent variable is not constant

C. The errors are not linearly independent of one another

D. The errors have non-zero mean

93. What would be then consequences for the OLS estimator if heteroscedasticity is

present in a regression model but ignored?

A. It will be ignored

B. It will be inconsistent

C. It will be inefficient

D. All of A,C,B will be true.

94. Multicollinearity occurs when

A. Two or more explanatory variables are perfectly correlated with one another

B. The explanatory variables are highly correlated with the error term

C. The explanatory variables are highly correlated with the dependent variable

D. Two or more explanatory variables are highly correlated with one another


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95. Which of the following are plausible approaches to dealing with a model that

exhibits heteroscedasticity?

a) Take logarithms of each of the variables

b) Add lagged values of the variables to the regression equation

c) Use suitably modified standard error

d)Use a generalized least square procedure

A. i and iv B. i and iii

C. i, ii, and iv only D. i, ii, iii, and iv.

96. Negative residual autocorrelation is indicated by which one of the following

A. A cyclical pattern in the residual

B. An alternating pattern in the residuals

C. A complete randomness in the residuals

D. Residuals is that are all close to zero

97. If OLS is used in the presence of autocorrelation, which of the following will be like

consequences?

i ) Coefficient estimate may be misleading

ii) Hypothesis tests could reach the wrong conclusions

iii) Forecasts made from the model could be biased

iv)Standard errors may inappropriate

A. ii and iv B. i and iii

C. i,ii and iii D. i ii, iii and iv

98. Which of the following are plausible approaches to dealing with residual

autocorrelation? i. Take logarithms of each of the variables

ii. Add lagged values of the variables to the regression equation

iii. Use dummy variables to remove outlying observations

iv. Try a model in first differenced form rather than in levels


C. i, ii, and iii only D. i, ii, iii, and iv.

99. Which of the following could result in autocorrelated residuals?

i)Slowness of response of the dependent variable to changes in the values of the independent

variables

ii)Over-reaction of the dependent variable to changes in the independent variables

iii)Omission of relevant explanatory variables that are autocorrelated

iv)Outliers in the data


C. i ,ii and iii D. i,ii,iii,iv

100. Which of the following scheme is dedicated to empowerment of girls students?

A. Sarva Shiksha Abhiyan

B. Padhe Bharat-Badhe Bharat


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C. Udaan

D. Mid-Day Meals

Documents

CHANAKYA GROUP OF ECONOMICS MOCK TEST