This quiz works best with JavaScript enabled. Home > Cbse > Class 12 > Commerce > Economics Macro Economics > Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting – Quiz 10 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 10 (60 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. National income after allowing for inflation. A) Disposable Income. B) Per Capita Income. C) Nominal National Income. D) Real National Income. Show Answer Correct Answer: D) Real National Income. 2. Which of the following best describes the circular flow of income? A) A model showing the flow of goods and services in a market. B) A model depicting how money flows through the economy. C) A method for calculating GDP. D) A theory of economic growth. Show Answer Correct Answer: B) A model depicting how money flows through the economy. 3. If NDP at factor cost = Rs 2000 and net factor income from abroad =(-)500, then NNP at factor cost will be: A) 1500. B) 2000. C) 2500. D) 1000. Show Answer Correct Answer: A) 1500. 4. If in an economy, the value of Net Factor Income from Abroad is Rs. 500 crores and the value of Factor Income to Abroad is Rs. 150 crores, identify the value of Factor Income from Abroad. A) Rs. 360 crores. B) Rs. 250 crores. C) Rs. (-)350 crores. D) Rs. 650 crores. Show Answer Correct Answer: D) Rs. 650 crores. 5. To avoid double counting when GDP is estimated, economists: A) Use retail prices. B) Use price of only intermediate goods. C) Calculate value added at each stage of production. D) Use GDP deflator. Show Answer Correct Answer: C) Calculate value added at each stage of production. 6. Calculate MISE, WhenNDP (FC)= 1000CRCOE=200CROS=500CR A) 300CR. B) 1700CR. C) 800CR. D) 1200 CR. Show Answer Correct Answer: A) 300CR. 7. Gross Domestic Product (GDP) includes ..... A) Final goods only. B) Intermediate and final goods. C) Intermediate goods only. D) Neither intermediate nor final goods. Show Answer Correct Answer: A) Final goods only. 8. If the total output is higher the amount of consumer goods that can be produced would be? A) Higher. B) Lower. C) Equal. D) None of the above. Show Answer Correct Answer: A) Higher. 9. Real national income means the national income measured in terms of. A) Retail prices. B) Wholesale prices. C) Current prices. D) Constant prices. Show Answer Correct Answer: D) Constant prices. 10. Which economic indicator changes after the economy has already begun to follow a particular trend? A) Predictive Indicators. B) Lagging Indicators. C) Leading Indicators. D) Coincident Indicators. Show Answer Correct Answer: B) Lagging Indicators. 11. In country 'X', if NNP at market price remained constant and depreciation increased compared to the previous year, then GNP at market prices will A) Decrease. B) Increase by an amount equal to rise in depreciation. C) Increase. D) Decrease by an amount equal to rise in depreciation. Show Answer Correct Answer: B) Increase by an amount equal to rise in depreciation. 12. These are the problems in measuring national income EXCEPT: A) Double counting. B) Depreciation. C) Lack of data. D) Indicate the standard of living. Show Answer Correct Answer: D) Indicate the standard of living. 13. Which of the following refers to money flows in an economy? A) Flow of factor services from households to business. B) Flow of services from firms to households. C) Flow of goods from firms to households. D) Flow of money across different sectors of the economy. Show Answer Correct Answer: D) Flow of money across different sectors of the economy. 14. What does Real GNP measure? A) Value of goods adjusted for inflation. B) Value of goods adjusted for exchange rates. C) Quantity of goods produced. D) Nominal value of goods produced. Show Answer Correct Answer: A) Value of goods adjusted for inflation. 15. In the industrial origin approach, if the manufacturing sector experiences significant growth compared to other sectors, what would likely happen to national income? A) Increase in national income. B) No change in national income. C) Increase in exports. D) Decrease in national income. Show Answer Correct Answer: A) Increase in national income. 16. Financial assistance and scholarship are the examples of A) Personal income. B) Per capita income. C) National income. D) Transfer payment. Show Answer Correct Answer: D) Transfer payment. 17. Net National Product also known as ..... A) Gross National Product. B) Capital consumption. C) Gross Domestic Product. D) Gross Capita Income. Show Answer Correct Answer: A) Gross National Product. 18. What is Gross Domestic Product used as an indicator of? A) Unemployment rate. B) Inflation rate. C) Interest rate. D) Indicator of Overall output or production of an economy. Show Answer Correct Answer: D) Indicator of Overall output or production of an economy. 19. A nation's gross domestic product (GDP): A) Is the money value of the total output produced by its citizens, regardless of where they are living. B) Is always some amount less than its C + I + G + X M. C) Is the money value of the total output produced within the borders of the nation. D) Can be found by summing C + I + S + X M. Show Answer Correct Answer: C) Is the money value of the total output produced within the borders of the nation. 20. It is necessary to add ..... to convert GNP factor cost to GNP at market price. A) Expenditure on import. B) Gross trading profits of companies. C) Indirect taxes and subtract subsidies. D) Current and capital expenditure by the central government. Show Answer Correct Answer: C) Indirect taxes and subtract subsidies. 21. Real national income measures: A) Nominal national income adjusted for inflation. B) Nominal national income adjusted for population change. C) Nominal national income adjusted for exchange rates. D) Nominal national income adjusted for unemployment. Show Answer Correct Answer: A) Nominal national income adjusted for inflation. 22. Which problem arises due to the existence of a large number of non-monetized activities in the agriculture sector? A) Problems of Non-monetized sector. B) Problem of Illiteracy. C) Problem of Expertise. D) Problem of Less Sophisticated Machinery. Show Answer Correct Answer: A) Problems of Non-monetized sector. 23. Manakah salah satu kegunaan data pendapatan? A) Mengukur kadar pertukaran. B) Mengukur kadar inflasi. C) Mengukur taraf kehidupan. D) Mengukur kadar pengangguran. Show Answer Correct Answer: C) Mengukur taraf kehidupan. 24. Which one includes depreciation? A) GNP at market price. B) NNP at market price. C) NNP at factor cost. D) All of these. Show Answer Correct Answer: A) GNP at market price. 25. Real GDP is obtained by A) Nominal GDP divided by CPI. B) Nominal GDP multiplied by price level. C) Nominal GDP minus GDP deflator. D) Nominal GDP divided by GDP deflator. Show Answer Correct Answer: D) Nominal GDP divided by GDP deflator. 26. Purchases by one production unit from other production unit are not always intermediate A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 27. What is the main problem associated with the Income Method? A) Transfer Profit. B) Transfer Income. C) Transfer Expenditure. D) Transfer Outcome. Show Answer Correct Answer: B) Transfer Income. 28. If a country experiences a decrease in the prices of imported raw materials used in manufacturing, how would it impact GDP calculated using the expenditure approach? A) Increase GDP. B) Increase in net exports. C) Decrease GDP. D) No change in GDP. Show Answer Correct Answer: A) Increase GDP. 29. If NFIA is negative the value of which would be greater? A) NNP. B) NDP. C) NNPat FC. D) GNP. Show Answer Correct Answer: B) NDP. 30. The decline in value of capital equipment due to age or wear and tear. A) Real National Income. B) Value Added. C) Depreciation. D) Declination. Show Answer Correct Answer: C) Depreciation. 31. Which of the following best describes national income in the modern sense, as explained by economists like Lipsey, Chrystral, and Ackley, focusing on the value of total output and the incomes generated, including wages, rent, interest, and profit? A) NATIONAL INCOME. B) REAL GDP. C) PER CAPITA INCOME. D) GROSS OUTPUT. Show Answer Correct Answer: A) NATIONAL INCOME. 32. How many approaches in calculating national income? A) 3. B) 4. C) 2. D) 1. Show Answer Correct Answer: A) 3. 33. What is the example of Factors of Production given by the household? A) Loan. B) Tax. C) Raw Materials. D) Import. Show Answer Correct Answer: C) Raw Materials. 34. Evaluate the significance of a decrease in business investments for long-term economic growth. A) Increase in exports. B) Negative impact on long-term economic growth. C) No impact on long-term economic growth. D) Positive impact on long-term economic growth. Show Answer Correct Answer: B) Negative impact on long-term economic growth. 35. Which phase of the business cycle is characterized by a decrease in GDP for two consecutive quarters? A) Recession. B) Expansion. C) Peak. D) Trough. Show Answer Correct Answer: A) Recession. 36. Difference between gross national product at a factors cost (GNPfc) and gross domestic product at market price (GDPmp) is caused by ..... A) Subsidies and indirect taxes. B) Depreciation value and indirect taxes. C) Net factors income from abroad and depreciation value. D) Net factor income from abroad, subsidies and indirect tax. Show Answer Correct Answer: D) Net factor income from abroad, subsidies and indirect tax. 37. What is GDP per capita? A) GDP divided by the value of capital inputs. B) GDP divided by the number of weeks in the year. C) GDP divided by the population. D) GDP divided by the number of workers. Show Answer Correct Answer: C) GDP divided by the population. 38. Governments and economists focus more on real GDP growth than nominal GDP growth A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 39. The problem of double counting in measuring GDP can be avoided by A) Including the values of the intermediate and final goods produced. B) Deducting indirect taxes and adding subsidies to the value of output. C) Deducting the value of goods imported from the value of goods exported. D) Including the value of all final goods and services produced. Show Answer Correct Answer: D) Including the value of all final goods and services produced. 40. Derive the best statement referring to a nation's gross domestic product (GDP) A) The market value of intermediate products. B) The market value of both final and intermediate products. C) The sum of the market value of final products produced and imported. D) The total final value created by the factor of production available within a country in a year. Show Answer Correct Answer: D) The total final value created by the factor of production available within a country in a year. 41. The payment for the use of land and natural resources A) Wages or Salaries. B) Interest. C) Rent. D) Profit. Show Answer Correct Answer: C) Rent. 42. A country with a current account deficit must be increasing its net foreign debts by the amount of the deficit. A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 43. What does Real GDP per capita provide an estimate of? A) Average number of hours worked per person. B) Total imports and exports. C) Total government revenue. D) Average output of a person in an economy. Show Answer Correct Answer: D) Average output of a person in an economy. 44. Which of the following is true regarding GNP and GDP? A) GNP is always higher than GDP. B) GDP is always higher than GNP. C) GNP and GDP are equal. D) The relationship between GNP and GDP depends on the country's economic structure. Show Answer Correct Answer: D) The relationship between GNP and GDP depends on the country's economic structure. 45. What is the formula for Disposable Personal Income (DPI)? A) Personal Income-Personal Income Tax. B) Gross Domestic Product + Net Factor Income Abroad. C) National Income + Transfer Payments-Corporate Income Taxes. D) Gross National Income-Depreciation. Show Answer Correct Answer: A) Personal Income-Personal Income Tax. 46. The industrial origin approach categorizes economic activities into different ..... A) Sectors. B) Countries. C) Continents. D) Time Periods. Show Answer Correct Answer: A) Sectors. 47. When analyzing the relationship between net exports and GDP, if a country has a trade surplus, what does it indicate? A) Imports are higher than exports. B) GDP is decreasing. C) The country is in recession. D) Exports are higher than imports. Show Answer Correct Answer: D) Exports are higher than imports. 48. The market price of all final goods of a country in a year is known as: A) GDP at Market Price. B) GDP at Factor Cost. C) NNP at factor cost. D) None. Show Answer Correct Answer: A) GDP at Market Price. 49. What does Gross Domestic Product (GDP) measure? A) Total output within a country's borders. B) Income earned by citizens abroad. C) Total output produced by a country's residents globally. D) Net income from abroad. Show Answer Correct Answer: A) Total output within a country's borders. 50. The total market value of all final goods and services produced within a period of time by Malaysians, refers to A) Net national Income. B) Gross Domestic Product. C) Gross National Product. D) Net National Product. Show Answer Correct Answer: B) Gross Domestic Product. 51. The difference between gross national product at market price and gross national product at factor cost is ..... A) Exports and imports. B) Net factor income from abroad. C) Subsidies and indirect taxes. D) Depreciation. Show Answer Correct Answer: C) Subsidies and indirect taxes. 52. Government savings, Sg, is equal to A) T-G. B) T + G. C) T = G. D) T + G-I. E) None of the above. Show Answer Correct Answer: A) T-G. 53. Create a scenario where a country's Real GNP decreases while its Money GNP increases. A) Population growth rate is higher than the inflation rate. B) Inflation rate is higher than the nominal growth rate. C) Inflation rate is lower than the nominal growth rate. D) Population growth rate is lower than the inflation rate. Show Answer Correct Answer: B) Inflation rate is higher than the nominal growth rate. 54. Of the following, which is not included in the calculation of national income? A) EPF contributions. B) Tax on corporate profits. C) Depreciation. D) Undistributed corporate income. Show Answer Correct Answer: C) Depreciation. 55. What is the purpose of measuring depreciation? A) To calculate the value of intermediate goods. B) To estimate the value of final goods. C) To measure the wear and tear of capital goods. D) To determine the value of consumer durables. Show Answer Correct Answer: C) To measure the wear and tear of capital goods. 56. The approach of computing GDP by adding up the amount of final goods and services produced in the economy during a given period is the A) Expenditure approach. B) Income approach. C) Circular approach. D) Output approach. Show Answer Correct Answer: A) Expenditure approach. 57. Which of the following best describes 'stagflation'? A) Low inflation and high economic growth. B) Low inflation and low unemployment. C) High inflation and high economic growth. D) High inflation and high unemployment. Show Answer Correct Answer: D) High inflation and high unemployment. 58. What is real GDP? A) Gross domestic product at factor cost. B) Gross domestic product calculated at current year prices. C) Gross domestic product at market price. D) Gross domestic product calculated at constant prices. Show Answer Correct Answer: D) Gross domestic product calculated at constant prices. 59. In which of the following situation, there is contraction of circular flow in an economy? A) Injection. B) Real flow. C) Stock. D) Leakage. Show Answer Correct Answer: D) Leakage. 60. The term 'real national income' is used to: A) Adjust income for inflation. B) Measure income at current prices. C) Exclude export earnings. D) Ignore government spending. Show Answer Correct Answer: A) Adjust income for inflation. ← PreviousNext →Related QuizzesCommerce QuizzesClass 12 QuizzesClass 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 1Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 2Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 3Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 4Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 5Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 6Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 7Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 8 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books