Most Repeated SSC CGL Economy MCQs Part1

Top Economic Questions which repeated on SSC CGL

Part 1: Basics of Economics (Beginner Level)

What is the fundamental economic problem?
(a) Technological unemployment
(b) Environmental degradation
(c) Scarcity of resources relative to wants
(d) Inflation

Answer: (c)
Economics is primarily the study of:
(a) Government policies
(b) Human behavior and decision-making in the face of scarcity
(c) International relations
(d) The stock market

Answer: (b)
The term "utility" in economics refers to:
(a) The usefulness of a commodity
(b) The price of a commodity
(c) The quantity of a commodity consumed
(d) The satisfaction derived from consuming a commodity

Answer: (d)
A market economy is characterized by:
(a) Central planning by the government
(b) Private ownership of resources and free price mechanism
(c) Equal distribution of income and wealth
(d) Absence of competition

Answer: (b)
Which of the following is a microeconomic concept?
(a) National income
(b) Inflation rate
(c) Consumer behavior
(d) Unemployment rate

Answer: (c)
The production possibility frontier (PPF) shows:
(a) The actual level of production in an economy
(b) The maximum possible combinations of two goods that can be produced with given resources and technology
(c) The distribution of income in an economy
(d) The level of employment in an economy

Answer: (b)
Opportunity cost is:
(a) The cost of the next best alternative forgone
(b) The monetary cost of a decision
(c) The total cost of production
(d) The average cost of production

Answer: (a)
Demand refers to:
(a) The desire for a commodity
(b) The ability to pay for a commodity
(c) The quantity of a commodity consumers are willing and able to buy at a given price and time
(d) The total market for a commodity

Answer: (c)
The law of demand states that, other things being equal:
(a) As price increases, demand increases
(b) As price decreases, demand decreases
(c) As price increases,1 quantity demanded decreases
(d) Price and quantity demanded are unrelated

Answer: (c)
Supply refers to:
(a) The total stock of a commodity
(b) The quantity of a commodity producers are willing and able to sell at a given price and time
(c) The need for a commodity
(d) The availability of resources

Answer: (b)
The law of supply states that, other things being equal:
(a) As price increases, quantity supplied decreases
(b) As price decreases, quantity supplied increases
(c) As price increases, quantity supplied increases2
(d) Price and quantity supplied are unrelated3

Answer: (c)
Equilibrium price is determined by:
(a) The government
(b) The central bank
(c) The interaction of demand and supply
(d) The cost of production

Answer: (c)
GDP stands for:
(a) Gross Domestic Product
(b) General Development Program
(c) Government Development Policy
(d) Gross Domestic Progress

Answer: (a)
National income is a measure of:
(a) A country's population
(b) The total value of goods and services produced by a country's residents in a given period
(c) The government's revenue
(d) The country's total exports

Answer: (b)
Inflation refers to:
(a) A sustained decrease in the general price level
(b) A sustained increase in the general price level
(c) A temporary increase in the price of a few goods
(d) A decrease in the unemployment rate

Answer: (b)
Unemployment refers to:
(a) People who are not working
(b) People who are willing and able to work but cannot find jobs
(c) People who are retired
(d) People who are students

Answer: (b)
Fiscal policy refers to:
(a) Policies related to money supply and credit control
(b) Policies related to government revenue and expenditure
(c) Policies related to international trade
(d) Policies related to environmental protection

Answer: (b)
Monetary policy refers to:
(a) Policies related to government revenue and expenditure
(b) Policies related to money supply and credit control
(c) Policies related to taxation
(d) Policies related to public debt

Answer: (b)
The central bank of India is:
(a) State Bank of India
(b) Punjab National Bank
(c) Reserve Bank of India
(d) ICICI Bank

Answer: (c)
The main objective of monetary policy in India is to:
(a) Promote economic growth
(b) Maintain price stability
(c) Increase government revenue
(d) Reduce income inequality

Answer: (b)
A mixed economy is one where:
(a) There is no private sector
(b) There is no public sector
(c) Both private and public sectors coexist
(d) Only small-scale industries exist

Answer: (c)
Globalization refers to:
(a) The increasing isolation of countries
(b) The increasing integration of economies worldwide
(c) The decline of international trade
(d) The focus on local production

Answer: (b)
Privatization means:
(a) Increasing government control over industries
(b) Transfer of ownership from the public sector to the private sector
(c) Nationalization of industries
(d) Expansion of the public sector

Answer: (b)
Liberalization in economics refers to:
(a) Increased government intervention in the economy
(b) Relaxation of government restrictions on economic activities
(c) Strengthening of trade barriers
(d) Promotion of state-owned enterprises

Answer: (b)
Sustainable development aims at:
(a) Meeting the needs of the present without compromising the ability of future generations to meet their own needs
(b) Maximizing4 economic growth at all costs
(c) Focusing solely on environmental protection
(d) Ignoring social equity

Answer: (a)
Human Development Index (HDI) is a measure of:
(a) Economic growth only
(b) Health, education, and standard of living
(c) Environmental quality
(d) Political freedom

Answer: (b)
The primary sector of the Indian economy includes:
(a) Manufacturing
(b) Banking
(c) Agriculture and allied activities
(d) Information technology

Answer: (c)
The secondary sector of the Indian economy includes:
(a) Agriculture
(b) Services
(c) Manufacturing and industry
(d) Trade

Answer: (c)
The tertiary sector of the Indian economy includes:
(a) Mining
(b) Construction
(c) Services like banking, education, and healthcare
(d) Forestry

Answer: (c)
What is the full form of NITI Aayog?
(a) National Institution for Transforming India
(b) National Institute for Technical Innovation
(c) National Integration and Technological Initiative
(d) National Initiative for Trade and Investment

Answer: (a)
NITI Aayog replaced which institution?
(a) Planning Commission
(b) Finance Commission
(c) National Development Council
(d) Reserve Bank of India

Answer: (a)
The Finance Commission is constituted by the:
(a) Prime Minister
(b) President
(c) Parliament
(d) Cabinet

Answer: (b)
The main function of the Finance Commission is to:
(a) Formulate monetary policy
(b) Allocate financial resources between the Union and the States
(c) Control government expenditure
(d) Advise on international trade agreements

Answer: (b)
What is a budget deficit?
(a) Revenue exceeds expenditure
(b) Expenditure exceeds revenue
(c) Revenue equals expenditure
(d) There is no government spending

Answer: (b)
A trade surplus occurs when:
(a) Imports exceed exports
(b) Exports exceed imports
(c) Imports equal exports
(d) There is no international trade

Answer: (b)
What is Foreign Direct Investment (FDI)?
(a) Investment in foreign currency
(b) Investment by residents of one country into businesses in another country
(c) Government borrowing from foreign countries
(d) Purchase of foreign goods and services

Answer: (b)
What is Foreign Portfolio Investment (FPI)?
(a) Long-term investment in foreign assets with managerial control
(b) Investment in foreign financial assets like stocks and bonds without direct managerial control
(c) Government loans to foreign countries
(d) Investment in real estate in foreign countries

Answer: (b)
The Balance of Payments (BOP) is a record of:
(a) A country's internal trade
(b) All economic transactions between the residents of a country and the rest of the world
(c) The government's budget
(d) The central bank's assets and liabilities

Answer: (b)
What is a tariff?
(a) A subsidy on exports
(b) A tax on imports
(c) A restriction on the quantity of imports
(d) A trade agreement between countries

Answer: (b)
What is a quota?
(a) A tax on exports
(b) A tax on imports
(c) A limit on the quantity of imports or exports
(d) A trade promotion policy

Answer: (c)
The World Trade Organization (WTO) primarily deals with:
(a) Providing financial assistance to developing countries
(b) Regulating international trade
(c) Promoting cultural exchange
(d) Ensuring global security

Answer: (b)
What is a subsidy?
(a) A tax imposed by the government
(b) Financial assistance provided by the government to producers or consumers
(c) A restriction on imports
(d) A ban on exports

Answer: (b)
What is the poverty line?
(a) The income level above which people are considered rich
(b) The minimum level of income deemed adequate in a particular country
(c) The average income of a country
(d) The income level at which people start paying income tax

Answer: (b)
Inclusive growth aims at:
(a) Rapid economic growth that benefits all sections of society
(b) Economic growth that only benefits the rich
(c) Economic growth that ignores environmental concerns
(d) Economic growth achieved through protectionist policies

Answer: (a)
What is the full form of GST?
(a) Goods and Sales Tax
(b) General Sales Tax
(c) Goods and Services Tax
(d) Government Sales Tax

Answer: (c)
GST is a:
(a) Direct tax
(b) Indirect tax
(c) Progressive tax
(d) Regressive tax

Answer: (b)
The concept of "demonetization" refers to:
(a) Introduction of new currency notes
(b) Withdrawal of old currency notes from circulation
(c) Devaluation of the national currency
(d) Printing more currency notes

Answer: (b)
What is a Public Sector Undertaking (PSU)?
(a) A company owned and managed by private individuals
(b) A company owned and managed by the government
(c) A company with foreign investment
(d) A small-scale industry

Answer: (b)
The main aim of disinvestment is to:
(a) Increase government control over PSUs
(b) Reduce the government's stake in PSUs
(c) Nationalize private companies
(d) Increase public debt

Answer: (b)
What is the meaning of per capita income?
(a) Total national income
(b) National income divided by the total population
(c) Income of the richest individuals
(d) Income of the poorest individuals

Answer: (b)
The Human Capital Index focuses on:
(a) Physical infrastructure
(b) Skills, knowledge, and health of the population
(c) Financial resources
(d) Natural resources

Answer: (b)
What is meant by the term "stagflation"?
(a) High economic growth and low inflation
(b) Low economic growth and high inflation
(c) High economic growth and high inflation
(d) Low economic growth and low inflation

Answer: (b)
The multiplier effect in economics refers to:
(a) A decrease in government spending leading to a larger decrease in national income
(b) An initial change in spending leading to a larger change in national income
(c) An increase in taxes leading to a larger increase in national income
(d) The effect of inflation on savings

Answer: (b)
What is the primary objective of the Small Industries Development Bank of India (SIDBI)?
(a) To finance large-scale industries
(b) To promote and finance small-scale industries
(c) To regulate the banking sector
(d) To provide housing loans

Answer: (b)
NABARD stands for:
(a) National Bank for Agriculture and Rural Development
(b) National Association for Banking and Retail Development
(c) National Bureau of Agricultural Research and Development
(d) National Bank for Agro-industrial and Regional Development

Answer: (a)
The main function of NABARD is to:
(a) Regulate commercial banks
(b) Promote and finance agriculture and rural development
(c) Provide loans to large industries
(d) Manage the country's foreign exchange reserves

Answer: (b)
What is the meaning of "fiscal deficit"?
(a) Total revenue minus total expenditure
(b) Total expenditure minus total revenue
(c) Total revenue minus revenue expenditure
(d) Capital expenditure minus capital receipts

Answer: (b)
Revenue deficit is:
(a) Total expenditure minus total receipts
(b) Revenue expenditure minus revenue receipts
(c) Capital expenditure minus capital receipts
(d) Fiscal deficit minus interest payments

Answer: (b)
Primary deficit is:
(a) Fiscal deficit plus interest payments
(b) Fiscal deficit minus interest payments
(c) Revenue deficit plus interest payments
(d) Revenue deficit minus interest payments

Answer: (b)
The Laffer curve shows the relationship between:
(a) Inflation and unemployment
(b) Tax rates and tax revenue
(c) Savings and investment
(d) Demand and supply

Answer: (b)
What is meant by "carbon tax"?
(a) A tax on income from investments
(b) A tax on the emission of carbon dioxide
(c) A tax on imported goods
(d) A tax on corporate profits

Answer: (b)
The concept of "trickle-down economics" suggests that:
(a) Government intervention is necessary to reduce income inequality
(b) Tax cuts for the wealthy will eventually benefit the poor
(c) Increasing minimum wage will lead to higher unemployment
(d) Free trade always benefits all countries

Answer: (b)
What is the Gini coefficient a measure of?
(a) Economic growth rate
(b) Income inequality
(c) Inflation rate
(d) Unemployment rate

Answer: (b)
A Gini coefficient of 0 represents:
(a) Perfect inequality
(b) Perfect equality
(c) Moderate inequality
(d) High economic growth

Answer: (b)

Part 1: Basics of Economics (Intermediate Level) - Continued

Which of the following is NOT a factor of production?
(a) Land
(b) Labor
(c) Capital
(d) Technology
(e) Money
Answer: (e)
Marginal utility is the:
(a) Total utility derived from consuming a commodity
(b) Additional utility derived from consuming one more unit of a commodity
(c) Average utility per unit of a commodity
(d) Utility derived from the last unit of money spent
Answer: (b)
The law of diminishing marginal utility states that as more units of a commodity are consumed:
(a) Total utility decreases
(b) Marginal utility increases
(c) Marginal utility decreases
(d) Total utility increases at a constant rate
Answer: (c)
Price elasticity of demand measures the responsiveness of:
(a) Price to a change in quantity demanded
(b) Quantity demanded to a change in price
(c) Income to a change in quantity demanded
(d) Quantity demanded to a change in income
Answer: (b)
If the price elasticity of demand for a good is greater than 1, the demand is said to be:
(a) Perfectly inelastic
(b) Inelastic
(c) Unitary elastic
(d) Elastic
Answer: (d)
Cross elasticity of demand measures the responsiveness of the quantity demanded of one good to a change in the:
(a) Price of the same good
(b) Income of the consumer
(c) Price of another related good
(d) Taste of the consumer
Answer: (c)
Income elasticity of demand measures the responsiveness of the quantity demanded of a good to a change in the:
(a) Price of the good
(b) Income of the consumer
(c) Price of a related good
(d) Advertisement expenditure
Answer: (b)
Normal goods have a ______ income elasticity of demand.
(a) Negative
(b) Positive
(c) Zero
(d) Infinity
Answer: (b)
Inferior goods have a ______ income elasticity of demand.
(a) Positive
(b) Negative
(c) Zero
(d) Unitary
Answer: (b)
Substitute goods have a ______ cross elasticity of demand.
(a) Negative
(b) Positive
(c) Zero
(d) Perfectly elastic
Answer: (b)
Complementary goods have a ______ cross elasticity of demand.
(a) Positive
(b) Negative
(c) Zero
(d) Unitary elastic
Answer: (b)
The short run in production is a period in which:
(a) All factors of production are variable
(b) At least one factor of production is fixed
(c) There is no production
(d) Technology remains constant
Answer: (b)
The long run in production is a period in which:
(a) At least one factor of production is fixed
(b) All factors of production are variable
(c) Technology changes
(d) Demand is perfectly elastic
Answer: (b)
Total product (TP) refers to the:
(a) Output produced by one unit of a variable input
(b) Sum of the marginal products
(c) Total quantity of output produced with given inputs
(d) Average output per unit of input
Answer: (c)
Average product (AP) is calculated as:
(a) Change in total product divided by change in input
(b) Total product divided by the quantity of input
(c) Marginal product divided by the quantity of input
(d) Total product multiplied by the quantity of input
Answer: (b)
Marginal product (MP) is the:
(a) Total product divided by the quantity of input
(b) Additional output produced by one more unit of a variable input
(c) Average product multiplied by the quantity of input
(d) Total product minus the previous level of total product
Answer: (b)
The law of variable proportions states that as more and more units of a variable factor are combined with a fixed factor:
(a) Total product will always increase
(b) Marginal product will always increase
(c) Initially marginal product increases, then it decreases, and eventually becomes negative
(d) Average product will always decrease
Answer: (c)
Fixed costs are costs that:
(a) Vary with the level of output
(b) Remain constant regardless of the level of output
(c) Increase as output increases
(d) Decrease as output increases
Answer: (b)
Variable costs are costs that:
(a) Remain constant regardless of the level of output
(b) Vary with the level of output
(c) Are incurred only in the long run
(d) Are independent of production
Answer: (b)
Total cost (TC) is the sum of:
(a) Average cost and marginal cost
(b) Fixed cost and variable cost
(c) Explicit cost and implicit cost
(d) Opportunity cost and accounting cost
Answer: (b)
Average fixed cost (AFC) is calculated as:
(a) Total fixed cost multiplied by output
(b) Total fixed cost divided by output
(c) Change in total fixed cost divided by change in output
(d) Total cost minus total variable cost
Answer: (b)
Average variable cost (AVC) is calculated as:
(a) Total variable cost multiplied by output
(b) Total variable cost divided by output
(c) Change in total variable cost divided by change in output
(d) Total cost minus total fixed cost
Answer: (b)
Average total cost (ATC) is calculated as:
(a) Total cost multiplied by output
(b) Total cost divided by output
(c) Average fixed cost minus average variable cost
(d) Marginal cost plus average variable cost
Answer: (b)
Marginal cost (MC) is the:
(a) Total cost divided by output
(b) Change in total cost resulting from producing one more unit of output
(c) Average cost multiplied by output
(d) Fixed cost plus variable cost
Answer: (b)
In a perfectly competitive market, firms are:
(a) Price makers
(b) Price takers
(c) Quantity setters
(d) Profit maximizers by controlling price
Answer: (b)
The demand curve facing a firm in a perfectly competitive market is:
(a) Downward sloping
(b) Upward sloping
(c) Perfectly elastic (horizontal)
(d) Perfectly inelastic (vertical)
Answer: (c)
A monopoly is a market structure characterized by:
(a) Many buyers and many sellers
(b) A single seller and many buyers
(c) Few sellers and many buyers
(d) Many sellers selling differentiated products
Answer: (b)
A key feature of a monopoly is:
(a) Free entry and exit of firms
(b) Homogeneous products
(c) Price-taking behavior
(d) Barriers to entry
Answer: (d)
In a monopolistic competition market structure, there are:
(a) A few large firms
(b) A single firm
(c) Many firms selling differentiated products
(d) Many firms selling identical products
Answer: (c)
Product differentiation is a key characteristic of:
(a) Perfect competition
(b) Monopoly
(c) Monopolistic competition
(d) Oligopoly
Answer: (c)
An oligopoly is a market structure characterized by:
(a) Many small firms
(b) A few large firms
(c) A single firm
(d) Many firms selling identical products
Answer: (b)
The kinked demand curve is a feature of:
(a) Perfect competition
(b) Monopoly
(c) Monopolistic competition
(d) Oligopoly
Answer: (d)
GDP is the sum of the value of all ______ goods and services produced within a country's domestic territory during a year.
(a) Intermediate
(b) Final
(c) Capital
(d) Consumer
Answer: (b)
Which of the following is NOT included in the calculation of GDP?
(a) Value of final goods
(b) Value of intermediate goods
(c) Government expenditure
(d) Net exports
Answer: (b)
National income at factor cost is equal to:
(a) Net National Product at market price
(b) Gross National Product at market price
(c) Net Domestic Product at market price minus net indirect taxes plus net factor income from abroad
(d) Net National Product at market price minus net indirect taxes
Answer: (d)
Personal income is:
(a) National income minus undistributed profits, corporate taxes, and social security contributions plus transfer payments
(b) National income plus all transfer payments
(c) National income minus indirect taxes
(d) National income plus subsidies
Answer: (a)

Most Repeated SSC CGL Economy MCQs Part1

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