BA Second Year (Sem 3 & 4) Economics – Daily Revision MCQ (English Medium)
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In which year was J. M. Keynes's 'The General Theory of Employment, Interest and Money' published?
Chapter 1: Introduction to Macroeconomics
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Answer: B. 1936
The General Theory appeared in 1936, after the Great Depression, and laid the foundation of modern macroeconomics.A country's GNP at market prices is ₹500 crore and depreciation is ₹50 crore. What is its NNP at market prices?
Chapter 2: National Income
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Answer: C. ₹450 crore
NNP = GNP − depreciation = 500 − 50 = ₹450 crore.The statement 'Supply creates its own demand' is known as:
Chapter 3: Classical and Keynesian Theory of Employment
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Answer: A. Say's Law of Markets
J. B. Say's Law of Markets is the base of the classical theory of full employment; Keynes rejected it.If the marginal propensity to consume (MPC) is 0.8, what is the value of the investment multiplier?
Chapter 4: Consumption Function and Multiplier
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Answer: D. 5
k = 1/(1 − MPC) = 1/(1 − 0.8) = 1/0.2 = 5.According to the accelerator principle, induced investment depends mainly on:
Chapter 5: Investment and Accelerator
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Answer: B. the rate of change in output (income)
The accelerator says new (induced) investment depends on the change in output or demand, not on its level.In Irving Fisher's equation of exchange MV = PT, what does 'T' stand for?
Chapter 8: Value of Money and Demand for Money: Fisher, Cambridge and Keynes
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Answer: C. Total volume of transactions
In MV = PT, M = money supply, V = velocity of money, P = price level and T = total volume of transactions (goods and services traded).'Too much money chasing too few goods' describes which type of inflation?
Chapter 10: Inflation
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Answer: A. Demand-pull inflation
When aggregate demand exceeds the available supply of goods, prices are pulled up: this is demand-pull inflation.If the cash reserve ratio is 20% and a bank receives a primary deposit of ₹1,000, what is the maximum total deposit the banking system can create?
Chapter 11: Commercial Banks
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Answer: D. ₹5,000
Credit (deposit) multiplier = 1/r = 1/0.20 = 5, so total deposits = 1,000 × 5 = ₹5,000 (of which ₹4,000 is new credit).In which year was the Reserve Bank of India established?
Chapter 13: Reserve Bank of India and Monetary Policy
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Answer: B. 1935
The RBI began on 1 April 1935 under the RBI Act, 1934; it was nationalised on 1 January 1949.Which of these is NOT one of Adam Smith's four canons of taxation?
Chapter 15: Public Finance and Taxation
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Answer: D. Canon of elasticity
Adam Smith gave four canons: equality, certainty, convenience and economy; elasticity was added later by other economists.
BA Second Year (Sem 3 & 4): MCQ in other subjects
All questions are written by PadhaiNotes in our own words from the common syllabus of Maharashtra universities (NEP). Your own university's syllabus may differ a little.