CBSE Class 12 Economics National Income Accounting MCQ Set 01

Question. Output means……………unless stated otherwise
a) Gross output at MP
b) Net output at MP
c) Gross output at FC
d) None of the options

Answer : A

Question. Which of the following is not a component of domestic income?
a) Operating surplus
b) Compensation of employees
c) Net factor income from abroad
d) Mixed income

Answer : C

Question. If factor cost is greater than marker price, it means that
a) Indirect taxes < subsidies
b) Indirect taxes > subsidies
c) Indirect taxes = subsidies
d) None of the options

Answer : A

Question. Which service is included in Tertiary Sector?
a) Mining
b) Construction
c) Communication
d) Animal Husbandry

Answer : C

Question. Financial help to a victim is:
a) tranfer payment
b) factor income
c) net factor income from abroad
d) None of the options

Answer : A

Question. The impact of an externality is:
a) Positive
b) Negative
c) either positive or negative
d) neither positive nor negative

Answer : C

Question. Which of the following is an example of Non-durable good?
a) Milk
b) Bread
c) Both (a) and (b)
d) Clothe

Answer : C

Question. If factor income received from abroad is equal to factor income paid abroad, then which of the following is not a valid statement?
a) National income = Domestic Income
b) NDP at FC + Depreciation = GNP at MP
c) NDP at FC + Depreciation = GNP at FC
d) All are valid

Answer : D

Question. Which of the following is a stock?
a) Wealth
b) Saving
c) Exports
d) Profits

Answer : A

Question. Two-sector economy consists of:
a) Households, firms
b) Firms, Foreign sector
c) Households, Government
d) Firms, Government

Answer : A

Question. The subject of the Study of Macro Economics is:
a) The Principle of Consumer
b) The Principle of National Income
c) The Principle of Producer
d) None of the options

Answer : B

Question. Final goods refer to those goods which are used either for…..or for…..
a) Consumption, investment
b) Consumption, resale
c) Resale, investment
d) Resale, further production

Answer : A

Question. Which out of the following is not included in estimation of NI?
a) Subsidized Lunch
b) Old-age Pension
c) Free Medical facilities
d) Construction of a house

Answer : B

Question. Which of the following is included in compensation of employees?
a) Dearness Allowance
b) Tools given to employees to be used during work
c) Payment by insurance company to an injured employee
d) Contribution by employee to provident fund

Answer : A

Question. Commodity service method’ is another name for:
a) Expenditure method
b) Income method
c) Value – added Method
d) None of the options

Answer : C

Question. Which of the following item will not be included while calculating NDP mp.
a) Private final consumption expenditure
b) Consumption of fixed capital
c) Govt Final consumption expenditure
d) Net Export

Answer : B

Question. Which of the following will not be included while calculating national income by income method?
a) Wages and Salaries
b) Royalty
c) Scholarship
d) Profit

Answer : C

Question. Which of the following is not included in estimation of NI?
a) Subsidies Lunch
b) Old Age Pension
c) Free Medical Facilities served in office to employees
d) Construction of a House

Answer : B

Question. Value of output is equal to
a) Sales+ Change in Stock
b) Sales + Closing Stock
c) Sales + Opening Stock
d) Sales- opening Stock

Answer : A

Question. Income of the Family is the example of which variable?
a) Stock Variable
b) Flow Variable
c) Both stock and flow
d) Neither Stock nor flow

Answer : B

Question. Which of the following is not a flow variable?
a) Income
b) Capital Formation
c) Supply of Money in a country
d) Leakage of water from a tank

Answer : C

Question. An Indian farmer produces wheat without incurring cost of inputs and sells for Rs. 1,000 to a miller who grinds wheat into flour and sells for Rs1,200 to baker. The baker sells bread to consumers for Rs. 1,600. Total value added is Rs.
a) 1600
b) 2200
c) 1000
d) 1400

Answer : A

Question. Which of the following is not true about final goods?
a) Final gods satisfy wants of ultimate consumers and producers.
b) Final goods have direct demand as they satisfy the wants directly.
c) Final goods are subject to further transformation in the process of production.
d) Final goods are neither used up as raw-material nor for resale in the same year.

Answer : C

Question. Following is an example of final good:
a) Flour used by a banker in making biscuits
b) Unsold stock of goods lying with the sellers
c) Tyres purchased by a transport company
d) Mobile sets purchased by a mobile dealer

Answer : B

Question. Which one is included in the four-sector model?
a) Family, Firm, Government, Foreign Sector
b) Family, Firm, Government
c) Family, Firm, Industry
d) None of the options

Answer : A

Question. Which of the following is not a part of final expenditure?
a) Consumer goods purchased by the government
b) Seeds purchased by the farmers
c) Consumer goods exported to rest of the world
d) Government fixed investment expenditure

Answer : B

Question. Which one of the following is included in circular flow?
a) Real Flow
b) Money Flow
c) Both (a) and (b)
d) None of the options

Answer : C

Question. Food Items purchased by a production unit are
a) Single-use Capital goods
b) Durable use consumer goods
c) Single-use consumer goods
d) Durable use capital goods

Answer : A

Question. Money flow involves exchange of:
a) Goods and services
b) Gifts
c) Money
d) None of the options

Answer : C

Question. What is the consumption of fixed capital called?
a) Capital formation
b) Depreciation
c) Investment
d) All of the options

Answer : B

Question. Economic territory of a country is also called :
a) Geographical territory
b) Political frontiers
c) Domestic territory
d) All of the options

Answer : C

Question. Study of the general price level is a subject matter of:
a) macroeconomics
b) microeconomics
c) both (a) and (b)
d) None of the options

Answer : A

Question. Which of the following statements is true?
a) Bread is always a consumer good
b) All producer goods are not capital goods
c) Transfer income is received for providing a good or service in return
d) Interest paid by a household on car loan from a bank is a factor payment

Answer : B

Question. NVA fc Equals to
a) Sum of factor payments
b) Sum of Current transfer Payments
c) Sum of Capital Transfer Payments
d) Net Current transfer from rest of the world

Answer : A

Question. NNP fc is called:
a) National Income
b) Domestic Income
c) Personal Income
d) Private Income

Answer : A

Question. National Income = Domestic income when:
a) NFIA is Positive
b) NFIA is Negative
c) NFIA is Zero
d) None of the options

Answer : C

Question. Consumption of fixed capital refers to fall in the value of fixed assets…
a) Due to normal wear and tear
b) Due to abnormal wear and tear
c) Due to foreseen obsolescence
d) Due to normal wear and tear and foreseen obsolescence

Answer : D

Question. own account production of goods is included in national income because:
a) goods are tangible
b) their valuation is possible
c) goods are more productive than services
d) None of the options

Answer : B

Question. Which of the following is not an element of final consumption expenditure?
a) Household expenditure on food
b) Government final consumption expenditure
c) Household expenditure on education
d) Expenditure on raw material

Answer : D

Question. “operating surplus” refers to:
a) Income from property
b) Income from entrepreneurship
c) Income from property and entrepreneurship
d) None of the options

Answer : C

Question. Why are the intermediate goods not included in the National Income while measuring National Income?
a) To avoid double accounting
b) It decreases income
c) Intermediate goods are not good
d) All of the options

Answer : A

Question. Which of the following items is not included while estimating GNP of a country at market price?
a) Sales of the enterprises
b) Indirect taxes
c) Remittances by NRIs
d) Subsidy

Answer : C

Question. Which of the following are covered under the domestic territory of India?
a) state bank of India in London
b) Google office in India
c) Office of Tata Motors in Australia
d) Russian Embassy in India

Answer : B

Question. Which of the following is an example of transfer income?
a) Bonus
b) Unemployement Allowance
c) Compensation from the employer
d) All of the options

Answer : B

Question. Depreciation expenses are included in:
a) GNPMp
b) NNPMp
c) NNPFC
d) None of the options

Answer : A
 

Question. Nominal GDP can never be less than real GDP.
Answer : FALSE: nominal GDP can be less than the real GDP, if price in the current year are less than the price in the base year.

Question. Good produced for self-consumption will be included in national income.
Answer : TRUE: such goods contribute to the current output and their imputed value will be included in national income.

Question. Increase in stock of goods held by a consumer will contribute to capital formation.
Answer : FALSE: any increase in goods of stock held by consumers does not contribute to capital formation as it is assumed that such goods are consumed, the moment are purchased.

Question. Gross domestic capital formation is always greater than gross fixed capital formation.
Answer : FALSE: gross domestic capital formation can be less than gross fixed capital formation if change in stock is negative.

Question. Productions of services for self-consumption are not included in national income.
Answer : TRUE: Such services are not included in national income as it is difficult to ascertain their market value and they are not rendered for earning income.