Understanding Gdp(12th Grade > Economics - 2 ) Questions and answers for exam Preparation

12th Grade > Economics - 2

UNDERSTANDING GDP MCQs

Total Questions : 30 | Page 2 of 3 pages

Question 11. Flow of goods and services across different sectors of the economy is called :

Real flow
Circular Flow
Monetary Flow
Inventory Flow

Discuss Question

Answer: Option A. -> Real flow
:
A
Real flow is the flow of goods and services.

Question 12. As a result of double counting, national income is:

Over-estimated
Underestimated
Correctly estimated
Not estimated for the currency year

Discuss Question

Answer: Option A. -> Over-estimated
:
A
National income is overestimated with the issue of double-counting.

Question 13. A car running between Delhi and Agra at a speed of 120 km/h includes:

Only stock variables
Only flow variables
Both a stock and a flow variable
None of these

Discuss Question

Answer: Option B. -> Only flow variables
:
B
Velocity is a flow variable.

Question 14. Second-hand cars are not accounted for in the GDP. State true or false.

True
False
Either a or b, depending on the use
Either a or b, depending on the quantity

Discuss Question

Answer: Option A. -> True
:
A
Second-hand items are not taken into account while calculating GDP.

Question 15. Which of the following is true about GDP?

It is a stock variable
It is a flow variable
It is not a variable
Its value is indeterminate

Discuss Question

Answer: Option A. -> It is a stock variable
:
A
GDP is a stock variable.

Question 16. In the value added method, we subtract the intermediate consumption from total value to avoid the problem of:

Including factor cost
Exclusion of incomes from abroad
Double counting
Indirect tax miscalculation

Discuss Question

Answer: Option C. -> Double counting
:
C
In order to avoid double counting, we subtract the intermediate consumption from total value.

Question 17. Consumption of all goods and services in the economy during the period of an accounting year is known as :

Aggregate demand
Aggregate supply
Aggregate consumption
None of these

Discuss Question

Answer: Option C. -> Aggregate consumption
:
C
Consumption of all goods and services in the economy during the period of an accounting year is called aggregate consumption.

Question 18. Calculate the value added in the primary sector from the following data. Ignore units.

\begin{matrix} Value of output in primary sector & 800 Value of output in secondary sector & 200 Value of output in tertiary sector & 300 Value of raw materials purchased by primary sector & 400 Value of raw materials purchased by secondary sector & 100 Value of raw materials purchased by tertiary sector & 50 \end{matrix}

400
800
750
1,300

Discuss Question

Answer: Option A. -> 400
:
A
Value added = Value of output in primary sector - Value of raw materials purchased by primary sector
= 800 - 400
= 400

Question 19. Differences between closing stock and opening stock during an accounting year are known as:

Increase in stock
Change in stock
Decrease in stock
None of these

Discuss Question

Answer: Option B. -> Change in stock
:
B
Change in stock refers to the difference between opening and closing stock.

Question 20. Value-added method measures the contribution of which of the following within the domestic territory of a country?

Household consumers
The producing enterprises owned by residents of the country
The producing enterprises owned by the non-residents of the country
Both (b) and (c)

Discuss Question

Answer: Option D. -> Both (b) and (c)
:
D
The producing enterprises owned by the non-residents of the country andhe producing enterprises owned by residents of the country are included in the value-added method.