Economics Test 1

Total Questions: 34

1 - To determine the correct level of GNP,it is necessary to:

A ) To add up the values of goods and services during one year ✅
B ) Add up all savings
C ) To count all imorts
D ) To add up the values of semi-finished goods

2 - GNP is always

A ) Less than NNP
B ) Greater than NNP ✅
C ) Equal to NNP
D ) Any of i,ii,iii

3 - The four factors payment are:

A ) Money, Capital, Salaries and income
B ) Wages,rent, interest and profits ✅
C ) Money,power,prestige and wealth
D ) Wages,interest, salaries and income

4 - Transfer payment means

A ) Bank loans
B ) The payment without work ✅
C ) Tax payments
D ) Payments made to all factors of production

5 - Which statement is true

A ) National Expenditure=National income ✅
B ) National Expenditure=National income+National Production
C ) National Expenditure=National income+National Taxes
D ) National Expenditure=National income -Taxes

6 - If we compare GDP and GNP, then

A ) GNP=GDP-net income from abroad
B ) GNP=GDP+net income from abroad ✅
C ) GNP=NNP-net income from abroad
D ) GNP=NNP+net income from abroad

7 - A TV set purchased from a retail store is an example of

A ) Intermediate goods
B ) Capital goods
C ) Surplus goods
D ) Final goods ✅

8 - GNP is

A ) Total sales in the economy
B ) Total monetary transactions in an economy
C ) The market value of all goods and services produced in an economy ✅
D ) Total spending in an economy

9 - GNP includes

A ) A loan from a bank
B ) A loan from one's parents
C ) Gifts and donations
D ) A broker's commission ✅

10 - Net Investment is

A ) Gross Investment minus household Investment
B ) Gross Investment minus govt. Investment
C ) Gross Investment minus capital consumption allowance ✅
D ) None of these

12 - Consumption spending does not include

A ) Household's purchases of food
B ) Household's purchases of a car
C ) Household's payment of rent for an apartment
D ) Household's purchase of stock in any XYZ corporation ✅

13 - Which of the following would increase national income

A ) Increase in taxation
B ) Increase in savings
C ) Increase in govt spending ✅
D ) Decrease in consumption spending

14 - Which of the following is a withdrawal from the circular flow income stream.

A ) Investment
B ) Subsidies
C ) Taxation ✅
D ) Consumption

15 - Pakistan's saving rate is

A ) 5%
B ) 14.4% ✅
C ) 25%
D ) 35%

16 - In the world population-wise Pakistan is

A ) 3rd
B ) 4th
C ) 6th ✅
D ) 8th

17 - Population growth rate in Pakistan is

A ) 1%
B ) 1.73% ✅
C ) 1.9%
D ) 4%

19 - Which is most likely to cause a more even distribution of income

A ) An increase in indirect taxes
B ) An increase in manager's salaries
C ) An increase in progressive taxation ✅
D ) An increase in the rate of inflation

21 - Pakistan started it's first five-year plan in

A ) 194
B ) 1950
C ) 1955 ✅
D ) 1960

23 - Contribution of industrial sector in Pakistan economy is

A ) 28%
B ) 18% ✅
C ) 8%
D ) Undetermined

24 - Size of Pakistan's 8th plan was in......rupees:

A ) 700 billion
B ) 1700 billion ✅
C ) 2700 billion
D ) 3700 billion

25 - Pakistan produces.......of its oil requirements

A ) 25% ✅
B ) 35%
C ) 45%
D ) 55%

26 - Economic development

A ) Is the same as economic growth
B ) Means improvement in lifestyle ✅
C ) Exists when there is equal distributed of income
D ) All tof these

27 - Economic development is measured on the basis of

A ) Increase in nominal GNP
B ) Increase in real GNP ✅
C ) Increase in personal incomes
D ) Increas in government revenue

28 - The govt.can control inflation by

A ) Increasing demand for goods
B ) Increasing supply of goods ✅
C ) Increasing money supply
D ) Decreasing taxes

29 - Government of Pakistan issues currency on the basis of:

A ) Availability of gold in the country
B ) Availability of dollars in the country
C ) Demand of money in the country ✅
D ) Tax collection

30 - Which property the paper money means. does not

A ) The number of times a unit of money changes hands daily
B ) The number of times a unit of money changes hands monthly
C ) The number of times a unit of money changes hands annually ✅
D ) The number of times a unit of money changes value

32 - If quantity of money is doubled, then according to Quantity Theory, value of money is

A ) Remains constant
B ) Double
C ) Half ✅
D ) None of these

33 - Which people are most likely to gain during inflation?

A ) Those living one pension
B ) Those living on their savings
C ) Those who are repaying borrowed money ✅
D ) Those who have lent money

34 - If quantity of money increase 100%, other things remaining constant, value of money changes by

A ) Increases by 100%
B ) Decreases by 100% ✅
C ) Decreases by 200%
D ) Does not change