SSC CGL Tier II Economics Quiz for the post of AAO

Q1. An indifference curve slopes down towards right since more of one commodity and less of another result in:
(a) same satisfaction.
(b) greater satisfaction.
(c) maximum satisfaction.
(d) decreasing expenditure.

Q2. Who is responsible for minting coins in India, and under which act? 
(a) RBI, Coinage Act
(b) RBI, RBI Act
(c) Government of India, Coinage Act
(d) Government of India, Banking Regulation Act

Q3. Which of the following statements is incorrect
(a) An indifference curve must be downward-sloping to the right.
(b) convexity of a curve implies that the slope of the curve diminishes as one moves from left to right.
(c) The income elasticity for inferior goods to a consumer is a negative.
(d) The total effect of a change in the price of a good on its quantity demanded is called the price effect.

Q4. The second glass of milk gives lesser satisfaction to boys. This is a clear case of
(a) Law of demand.
(b) Law of diminishing returns.
(c) Law of diminishing utility.
(d) Law of supply.

Q5. Which of the following is a Money Market Instrument? 
(a) Call Money
(b) T-Bills
(c) Collateralized Borrowing and Lending Obligations (CBLO)
(d) All are Money Market Instruments

Q6. The consumer is in equilibrium when the following condition is satisfied:
(a) (MUx)/(MUy )>Px/Py
(b) (MUx)/(MUy )<Px/Py
(c) (MUx)/(MUy )=Px/Py
(d) None of the above

Q7. The term “hyper-inflation” is used to denote?
(a) a situation with moderate rise in price level
(b) an inflationary situation where the external forces are the primary contributing factors
(c) a “runway” or “galloping” inflationary situation where the monetary unit becomes almost worthless
(d) a situation where the cost of living index is rising alarmingly

Q8. Which one of the following is also known as planning curve?
(a) Long run average cost curve.
(b) Short run average cost curve.
(c) Average variable cost curve.
(d) Average total cost curve.

Q9. The cost of one thing in terms of the alternative given up is known as:
(a) production cost.
(b) physical cost.
(c) real cost.
(d) opportunity cost.

Q10. Which of the following is the concept of marginal cost closely related?
(a) variable cost.
(b) fixed cost.
(c) opportunity cost.
(d) economic cost.

Q11. Which of the following statements is correct?
(a) When the average cost is rising, the marginal cost must also be rising.
(b) When the average cost is rising, the marginal cost must be falling.
(c) When the average cost is rising, the marginal cost is above the average cost.
(d) When the average cost is falling, the marginal cost must be rising.

 Q12Which one of the following is not a feature of Limited Liability Partnership Firm?
(a) Partner should be less than 20
(b) Partner and management need not to be separate
(c) Internal governance should be decided by mutual agreement among partners
(d) It is a corporate body with perpetual succession

Q13. Which of the following is an example of “explicit cost”?
(a) The wages a proprietor could have made by working as an employee of a large firm.
(b) The income that could have been earned in alternative uses by the resources owned by the firm.
(c) The payment of wages by the firm.
(d) The normal profit earned by a firm.

Q14. Which of the following is an example of an “implicit cost”?
(a) Interest that could have been earned on retained earnings used by the firm to finance expansion.
(b) The payment of rent by the firm for the building in which it is housed.
(c) The interest payment made by the firm for funds borrowed from a bank.
(d) The payment of wages by the firm.

Q15. Which financial entities can issue Certificate of Deposits (CDs)?
(a) Scheduled Commercial Banks, excluding RRBs
(b) Financial Institutions permitted by RBI
 (c) BSNL
(d) Both (a) and (b)


                                                                     Solutions

S1. Ans.(a)
Sol.


S2. Ans.(c)
Sol.


S3. Ans.(c)
Sol.


S4. Ans.(c)
Sol.


S5. Ans.(b)
Sol.


S6. Ans.(c)
Sol.


S7. Ans.(c)
Sol.


S8. Ans.(a)
Sol.


S9. Ans.(d)
Sol.


S10. Ans.(a)
Sol.


S11. Ans.(c)
Sol.


S12. Ans.(b)
Sol.


S13. Ans.(c)
Sol.


S14. Ans.(a)
Sol.


S15. Ans.(d)
Sol.





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