Managerial Economics Set 3
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This set of Managerial Economics Multiple Choice Questions & Answers (MCQs) focuses on Managerial Economics Set 3
Q1 | The unemployment caused by a decline in demand for production in a particular industry is
- seasonal unemployment
- frictional unemployment
- structural unemployment
- none of these
Q2 | Which of the following is not a development issue in india.
- unemployment
- population pressure
- inflation
- decreasing trend of foreign capital
Q3 | India’s economy growth is primarily driven by
- industry
- agriculture
- service
- none of these
Q4 | In which exchange rate system, exchange rate is fixed by the monetary authority
- flexible exchange rate system
- fixed exchange rate system
- managed floating exchange rate system
- none of these
Q5 | Direct foreign investment is part of
- current account
- fixed account
- long term account
- financial account
Q6 | MNC
- always produce primary goods
- always produce manufactured goods
- always produce service,
- may produce primary or manufactured goods
Q7 | One major initiative to attract foreign companies to invest in india is
- raise the standard of education
- to promote unemployment in the public sector
- to build up special economic zones
- both a & b
Q8 | The portfolio investment by foreign institutional investor is
- fdi
- fii
- bop
- sdr
Q9 | Under the new trade policy, import licensing was abolished except in case of
- textile industry
- consumer goods industry
- it industry
- hazardous and environmentally sensitive industry
Q10 | Where do MNCs choose to set up production?
- cheap goods,
- cheap labour resources
- economic sustainability
- none of these.
Q11 | Cargil foods, an MNC has bought over which indigenous Indian company?
- amul
- britannia
- parakh foods
- dabur
Q12 | For motors entered the Indian automobile business in collaboration with which Indian manufacturer?
- mahindra and mahindra
- tata motors
- maruthi suzuki
- hindustan motors
Q13 | Trade between countries
- determines prices of products in different countries
- decreases competition between countries
- makes a country dependent on the other
- none of these
Q14 | Globalization by connecting countries leads to
- lesser competition among producers
- greater competition among producers
- no competition between producers
- none of these
Q15 | If tax is imposed on Chinese toys, what will happen?
- chinese toy makers will benefit
- indian toy makers will proposer
- chinese toys will remain cheap,
- indian consumers will buy more chinese toys
Q16 | Which of the following is an example of a trade barrier?
- foreign investment
- delay or damage of goods
- tax on imports
- none of these
Q17 | Which out of the following industries has a large number of well off buyers in urban areas?
- footwear
- automobile
- jewellery
- clothing and accessories
Q18 | Automatic fiscal stabilizers
- Keep the federal budget balanced
- Keep the federal high employment budget balanced
- Help to reduce the severity of recessions and inflationary boom periods
- Increases structural deficits over the business cycle
Q19 | The higher the marginal income tax rate, the
- Higher the MPC out of disposable income
- Lower the MPC out of disposable income
- Highest the autonomous expenditure multiplier
- lower the autonomous expenditure multiplier
Q20 | Suppose that the MPC out of disposable income was 0.8 and the marginal tax rate was 0.25 for a given economy. In this case, the value of the tax multiplier in the simple Keynesian model would be
- 1
- -2.
- 2.5
- 2
Q21 | Suppose that the MPC out of disposable income was 0.8 and the tax function for a given economy was T= -30+0.25Y. an increase in the intercept of the tax function of 10 units(from -30 to -20 would cause equilibrium income in the simple Keynesian model to fall by
- -20 units
- 10 units
- 20 units
- 40 units
Q22 | If the tax function is given by T= -20+0.1 Y the average tax rate would
- Be 0.1
- Fall as income falls
- Vary negatively with income
- Be -20 _0.1
Q23 | The role of the progressive tax system as an autonomous fiscal stabilizer requires that the budget
- Should require actual deficits be equal to zero on average
- Should go into a surplus at appropriate points in the business cycle.
- Cannot have a structural deficit component
- Both a & b
Q24 | If the tax function is T= t0+t1y where t1 equals 1/3,and if the marginal propensity to consume out of disposable income is 3/4 , then the change in GDP oer unit change into t0 (∆Y/∆ t0) will be
- -1
- +1
- -1.5
- -2
Q25 | In the simple Keynesian model, if the tax function is given by T=0.15Y and the consumption function is C= 50 + 0.7 YD then a 10-unit ncrease in government spending would increase equilibrium income by
- 10 units
- 11.2 units
- 22.4 units
- 30 units