National Income accounting Set 2
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This set of Business Economics Multiple Choice Questions & Answers (MCQs) focuses on National Income accounting Set 2
Q1 | Which of the following is not a component of domestic income?
- operating surplus
- compensation of employees
- net factor income from abroad
- mixed income
Q2 | If factor cost is greater than marker price, it means that
- indirect taxes < subsidies (subsidy> indirect taxes)
- indirect taxes > subsidies
- i.t = subsidies
- none
Q3 | An Indian farmer produces wheat without incurring cost of inputs alllsells for Rs. 1,000 to a miller who grinds wheat into flour and sells for Rs 1,200 to baker. Thebaker sells bread to consumers for Rs. 1,600. Total added is Rs.
- 1,600
- 2,200
- 1,000
- 1,400
Q4 | Which of the following is not true about final goods ?
- final gods satisfy wants of ultimate consumers and producers.
- final goods have direct demand as they satisfy the wants directly.
- final goods are subject to further transformation in the process of production.
- final goods are neither used up as raw-material nor for resale in the same year.
Q5 | Following is an example of final good:
- flour used by a banker in making biscuits
- unsold stock of goods lying with the sellers
- tyres purchased by a transport company
- mobile sets purchased by a mobile dealer
Q6 | Which out of the following is not included in estimation of NI?
- subsidized lunch
- old-age pension
- free medical facilities
- construction of a house
Q7 | Which of the following is a synonym of “Undistributed Profits”?
- savings of private corporate sector
- reserves and surplus
- retained earnings
- all of these
Q8 | Piyush’s mother is a teacher. She also teaches Piyush. How would you treat this whitecalculating national income and domestic income ?
- it will be included in the national income, but not in the domestic income.
- it will be included in the domestic income, but not in the national income.
- it will be included in domestic income as well as national income.
- it will neither be included in the domestic income nor in the national income.
Q9 | Goods which are not used in the production of other goods are called:
- capital goods
- consumption goods
- producer goods
- intermediate goods
Q10 | Depreciation is the:
- loss of vale of fixed assets in use due to normal wear and tear
- loss of value of fixed assets in use due to normal rate of accidental damages
- loss of value of fixed assets in the due to foreseen obsolescence
- all of these
Q11 | Which of following is not included in national income ?
- factor income
- rent
- operating surplus
- transfer income
Q12 | Which of following is not an intermediate goods?
- wheat
- gold
- service of doctor
- sand and bricks
Q13 | Which of following is not a final good?
- machinery purchased by dealer
- machinery purchased by a factory
- use of petrol
- washing machine
Q14 | Which of following is not a part of national income?
- depreciation
- net factor income from abroad
- operating surplus
- mixed income
Q15 | Product method of calculating national income is also known as:
- income method
- value added method
- expenditure method
- distribution method
Q16 | Transfer payments refer to payments, which are made:
- without any exchange of goods and services
- to workers on transfer from one job to another
- as compensation to employees
- none
Q17 | National Income differs from Net National Product at market price by the amount of:
- current transfers from rest of the world
- net indirect taxes (difference between indirect tax and subsidy)
- national debt interest
- it does not differ
Q18 | Net national product at factor cost is also known as:
- net domestic product
- gross national product
- national income
- personal income
Q19 | In GNP calculation which of the following should be excluded?
- rental incomes
- interest payments
- dividends
- government transfer payment
Q20 | National Income differs from Net National Product at market price by the amount of:
- current transfers from rest of the world
- net indirect taxes
- national debt interest
- it does not differ
Q21 | Excess demand for money, according to Say’s law in the Economy:
- is greater
- is very less
- is equal to zero
- there is no relationship between excess demand for money and say’s law
Q22 | Which of the following is not an assumption of classical theory?
- price flexibility
- unemployment
- say’s law
- neutrality of money
Q23 | In classical theory the equality between saving and investment is brought about by:
- rate of interest
- income
- consumption
- multiplier
Q24 | The normal condition of a capitalist economy in classical theory is:
- underemployment
- full employment
- general unemployment
- frictional unemployment
Q25 | In classical theory of employment, there is the possibility of:
- voluntary unemployment
- no unemployment
- involuntary unemployment
- disguised unemployment