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Economics MCQ Questions and Solutions with Explanations | Commerce

Economics MCQ Questions and answers with easy and logical explanations. Commerce provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. Economics MCQ is important for exams like B.COM, M.COM, BBA, BBM, CA, CS, CMA, CPA, CFA, UPSC, NET, Banking and other commerce department exam. Page-3 section-1

Each section contains 100 MCQs on Economics .
21
Who is the 'lender of the last resort' in the banking structure of India?
Discuss
Answer & Solution
Answer: Option B
Solution:
Reserve bank of India is the 'lender of the last resort' in the banking structure of India. A lender of last resort is an institution, usually a country's central bank, that offers loans to banks or other eligible institutions that are experiencing financial difficulty or are considered highly risky or near collapse.
22
____ is the official minimum rate at which the Central Bank of a country is prepared to rediscount approved bills held by the commercial banks
Discuss
Answer & Solution
Answer: Option B
Solution:
Bank rate is the official minimum rate at which the Central Bank of a country is prepared to rediscount approved bills held by the commercial banks.
23
In order to control credit, Reserve Bank of India should
Discuss
Answer & Solution
Answer: Option C
Solution:
In order to control credit, Reserve Bank of India should Increase CRR and increase Bank rate. During high inflation in the economy, RBI raises the CRR to lower the bank's loanable funds.
24
Which among the following is a function of the Reserve Bank of India?
Discuss
Answer & Solution
Answer: Option B
Solution:
Collecting and compilation of statistical information relating to banking & other financial sector is a function of the Reserve Bank of India.
25
Credit creation power of the commercial banks gets limited by which of the following?
Discuss
Answer & Solution
Answer: Option D
Solution:
Credit creation power of the commercial banks gets limited by Banking habits of the people, Cash Reserve Ratio and Credit policy of the central bank.
26
Number of times a unit of money changes hands in the course of a year is called
Discuss
Answer & Solution
Answer: Option C
Solution:
Number of times a unit of money changes hands in the course of a year is called Velocity of money. The velocity of money is the number of times a unit of money changes hands during exchanges in a year.
27
What is meant by Autarky in international trade?
Discuss
Answer & Solution
Answer: Option D
Solution:
Autarky in international trade means the idea of self sufficiency and no international trade by a country. A country is said to be in a complete state of autarky if it has a closed economy, which means that it does not engage in international trade with any other country.
28
Normally a demand curve will have the shape
Discuss
Answer & Solution
Answer: Option C
Solution:
Normally a demand curve will have downward sloping shape. The demand curve is downward sloping, indicating the negative relationship between the price of a product and the quantity demanded.
29
Who defined Economics as a 'science which studies human behaviour as a relationship betweeen ends and means which have alternative uses'?
Discuss
Answer & Solution
Answer: Option A
Solution:
L. Robbins defined economics: "Economics is the science which studies human behaviour as a relationship between ends and scarce means which have alternative uses."
30
Law of demand shows relation between
Discuss
Answer & Solution
Answer: Option B
Solution:
Law of demand shows relation between Price and quantity of commodity. Quantity demanded of a commodity is inversely related to the price of the commodity.