National Income and Economic Development MCQ Questions with Answers

Question 1 : The total amount of income from economic activities across the country in a year is called ………..

a) Disposable income
b) National income
c) Personal income
d) Private income

Answer : b

Question 2 : National income is the

a) Net National Product at market price
b) Net National Product at factor cost
c) Net Domestic Product at market price
d) Net Domestic product at factor cost

Answer : b

Question 3 : The value of national income adjusted for inflation is called

a) Per Capital Income
b) Disposable Income
c) Inflation Rate
d) Real National Income

Answer : d

Question 4 : National Income is also called as

a) GNP at factor cost
b) GNP at market price
c) NNP at factor cost
d) NNP at market price

Answer : a

Question 5 : Which one of the following is not included while estimating national income through income method?

a) Rent
b) Mixed incomes
c) Pension
d) Undistributed profits

Answer : c

Question 6 : National income is generated from

a) any money-making activity
b) any laborious activity
c) any profit-making activity
d) any productive activity

Answer : b

Question 7 : The incomes of Indians working abroad are a part of

a) domestic income of India
b) income earned from Abroad
c) net domestic product of India
d) gross domestic product of India

Answer : c

Question 8 : In calculating national income which of the following is included?

a) Services of housewives
b) Pensions
c) Income of smugglers
d) Income of watchmen

Answer : d

Question 9 : The economist, who for the first time scientifically determined national income in India was

a) DR Gadgil
b) VKRV Rao
c) Manmohan Singh
d) YV Alagh

Answer : b

Question 10 : National Income in India is estimated by

a) Planning Commission
b) Central Statistical Organisation
c) Finance Commission
d) Indian Statistical Institute

Answer : b

Question 11 : Who was the head of national income Committee, constituted in 1949?

a) DR Gadgil
b) Dr PC Mahalanobis
c) Dr VKRV Rao
d) B Natrajan

Answer : b

Question 12 : In which year, the estimates of national income was released by the government for the first time?

a) 1947-48
b) 1948-49
c) 1950-51
d) 1952-53

Answer : b

Question 13 : In India, national Income is calculated by the Central Statistical Office in which one of the following time period?

a) 31st April to 1st March
b) 1st February to 31st March
c) 1st April to 31st March
d) 28th February to 1st March

Answer : c

Question 14 : Which of the following method/s is/are used to calculate national income in India?

a) Production method
b) Expenditure method
c) Income method
d) All of the above

Answer : d

Question 15 : One of the problems in calculating national income in India is

a) underemployment
b) inflation
c) low level of savings
d) non-organised sector

Answer : d

Question 16 : Which of the following method is not used in determining national income at a country?

a) Income method
b) Output method
c) Input method
d) Investment method

Answer : d

Question 17 : How can we arrive at NNP from GNP in national income accounting?

a) GNP + Depreciation
b) GNP – Net Indirect Taxes
c) GNP – Depreciation
d) GNP + Net indirect Taxes

Answer : c

Question 18 : National income accounting entails a calculation of the net contribution at every stage at manufacturing. This method for national income accounting is known as

a) Product method
b) Income method
c) Consumption method
d) Expenditure method

Answer : a

Question 19 : National income at constant price is divided from total production of the country, the result received is known as

a) Per Capital Income
b) Real Per Capita Income
c) Disposable Per Capita Income
d) Real Gross Domestic Product

Answer : b

Question 20 : The average income of the country is

a) Per Capital Income
b) Disposable Income
c) Inflation Rate
d) Real National Income

Answer : a

Question 21 : The most appropriate measure of country’s economic growth is

a) GDP
b) NDP
c) Per Capital Income
d) GNP

Answer : c

Question 22 : Per Capita Income is

a) Net National Product/Total Population
b) Total Population/National Income
c) Gross National Product/Total Population
d) National Income /Personal Income

Answer : a

Question 23 : The growth rate of the Per Capita Income at the current price is higher than the Per Capital Income at constant prices, because the latter takes into account the rate of

a) increase in price level
b) population growth
c) growth in money supply
d) increase in wage rate

Answer : a

Question 24 : On the basis of which of the following indicator, the lifestyle standard of person can be identified?

a) Gross Domestic Income
b) Net National Income
c) Per Capita Income
d) Disposable Personal Income

Answer : c

Question 25 : Who among the following Indian freedom fighters made an attempt to estimate the Per Capita Income of India?

a) Gopal Krishna Gokhale
b) Pherozshah Mehta
c) Surendranath Banerjee
d) Dadabhai Naoroji

Answer : d

Question 26 : The Per Capita Income in India was Rs.20 in 1867-68, was ascertained for the first time by

a) MG Ranade
b) Sir W Hunter
c) RC Dutta
d) Dadabhai Naoroji

Answer : d

Question 27 : What is meant by disposable personal income?

a) A person’s income
b) income remaining out of personal income after the payment of tax
c) income that remains after meeting necessities
d) income spent for food only

Answer : b

Question 28 : Which one of the following equals Personal Disposable Income?

a) Personal Income – Direct taxes paid by households and miscellaneous fees, fines etc.
b) Private Income – Saving of Private Corporate Sectors – Corporation Tax
c) Private Income – Taxes
d) Total Expenditure of Households – Income Tax gifts received

Answer : a

Question 29 : A ‘Tansfer Income’ is an

a) income which is not produced by any production process
b) income taken away from one person and given over to another
c) unearned income
d) earned income

Answer : a

Question 30 : The value of all final goods and services produced by the normal residents of a country and their property, whether operating within the domestic territory of the country or outside in a year is termed as

a) Gross National Income
b) Net National Income
c) Gross Domestic Product
d) Net Domestic Product

Answer : a

Question 31 : The national income of a country for a given period is equal to the

a) total value of goods and services produced by the nationals
b) sum of total consumption and investment expenditure
c) sum of personal income of individuals
d) money value of final goods and services produced

Answer : d

Question 32 : Arrange the following Indian states in an order from having high Per Capita Income to low Per Capita Income

I. Sikkim
II. Goa
III. Chandigarh
IV. Delhi

Choose the right answer form the codes given below

a) III, IV, I, II
b) I, II, III, IV
c) II, IV, III, I
d) II, IV, I, III

Answer : d

Question 33 : Consider the following statements

I. Dadabhai Naoroji was the first Indian to estimate the national income of the country
II. National Income Committee established in India after getting independence was headed by Professor VKRV Rao

Which of the following statements given above is/are correct?

a) Only I
b) Only II
c) Both I and II
d) Neither I nor II

Answer : c

Question 34 : Consider the following statements and identify the right one

I. CSO is a premier statistical institution for collecting data in India
II. It presents the national income estimates twice a year

a) Only I
b) Only II
c) Both I and II
d) None of the above

Answer : c

Question 35 : Coming soon

a)
b)
c)
d)

Answer :

Question 36 : Which one of the following is the most appropriate method to measure the economic growth of a country?

a) National Income
b) Net National Produce
c) Gross Capital Formation
d) Gross Domestic Product

Answer : d

Question 37 : Gross Domestic Product is a

a) sum of all the product produced in an economy in one year
b) sum of the product and services produced in an economy in one year
c) sum of all the final product in an economy in one year
d) sum of the final product and services in an economy in one year

Answer : d

Question 38 : The largest contributor to the gross domestic savings of India is

a) the household sector
b) the private corporate sector
c) the public sector
d) the foreign sector

Answer : a

Question 39 : In 1980s, Indian economy was in the process of the Hindu rate of growth. Which one of the following is associated with the Hindu rate of growth?

a) Population growth rate
b) Growth rate of Naxalism
c) Growth rate of foodgrain production
d) Growth rate of Gross Domestic Product

Answer : d

Question 40 : Which of the following is not a method to calculate the Gross Domestic Product (GDP)?

a) Product method
b) Income law
c) Expenditure method
d) Diminishing cost method

Answer : d

Question 41 : Which of the following factors is/are accounted in the calculations of Gross Domestic Product of a country in the Expenditure method?

a) Private consumption
b) Gross investments and government spending
c) Net expenditure of the expenditure on export and import
d) All of the above

Answer : d

Question 42 : In India, what time period is used for the calculating GDP?

a) 1 year
b) 2 years
c) 4 years
d) 5 years

Answer : a

Question 43 : Which one of the following is possible in an economy?

a) GDP=PI
b) GDP=GNP
c) FC=MP
d) NNP=GDP

Answer : b

Question 44 : Which one of the following combination is incorrect?

a) NDP_MP = GDP_MP – Depreciation
b) GDP_MP = GDP_MP + (Indirect Tax – Subsidy)
c) GDP_FC = GDP_MP – (Indirect Tax – Subsidy)
d) NDP_FC = GDP_MP – Depreciation

Answer : c

Question 45 : The net value of GDP after deducting depreciation from GDP is

a) Net National Product
b) Net Domestic Product
c) Gross National Product
d) Disposable Income

Answer : b

Question 46 : The service sector of India generates more than

a) 33% of GDP
b) 40% of GDP
c) 42% of GDP
d) 50% of GDP

Answer : d

Question 47 : Which one of the following economists firstly introduced Gross Domestic Product to measure the economic growth of a country?

a) Simon Kuznet
b) Max O Lorenz
c) John Maynard Keynes
d) Ernst Engel

Answer : a

Question 48 : Real Gross Domestic Product is measured at

a) Current prices
b) Constant prices
c) Average prices
d) None of these

Answer : b

Question 49 : Which one of the following formula is correct?

a) GNP_MP = GDP_FC + X – M
b) GNP_MP = GDP_MP – X – M
c) GNP_MP = GDP_MP – X + M
d) GNP_MP = GDP_MP + X – M

Answer : d

Question 50 : In an economy, ……………. is an output minus intermediate consumption

a) Net Value Added
b) Gross Value Added
c) Average Value Added
d) None of the above

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