Inflation, Recession, and GDP MCQs for RAS
Practice 20 free Inflation, Recession, and GDP questions under World Economy — Economy.
Strengthen your Inflation, Recession, and GDP knowledge for RAS with curated MCQs. Switch between Hindi and English anytime.
RAS — World Economy — Inflation, Recession, and GDP
20 Questions • Instant results & explanations • Hindi & English
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Question 1 of 20
What primary natural factor was responsible for the estimated 3.8% rebound in India's agricultural sectoral growth in the recent macroeconomic cycle?
Question 2 of 20
Assertion (A): The National Bureau of Economic Research (NBER) strictly uses the single metric of 'two consecutive quarters of negative real GDP growth' to declare an official recession. Reason (R): GDP is the only metric that captures the absolute scale of economic activity.
Question 3 of 20
If a government decides to abruptly raise administered taxes on fuel, resulting in an immediate jump in the general price level, how would a macroeconomist accurately classify this event?
Question 4 of 20
What is the economic phenomenon called where households preemptively expect higher future inflation, leading workers to demand higher wages, which in turn forces firms to raise prices, creating a continuous cycle?
Question 5 of 20
What is the specific danger of excessive sovereign debt accumulation if a government bypasses the FRBM Act?
Question 6 of 20
Consider the following statements regarding the impact of double-digit inflation on labor: 1. It causes a sharp increase in the real purchasing power of agricultural laborers. 2. It exposes the extreme downward rigidity of nominal wages in the unorganized sector. Which of the statements given above is/are correct?
Question 7 of 20
What is explicitly omitted from GDP calculations, leading to the systematic undercounting of women's economic contributions?
Question 8 of 20
Which of the following components is NOT included in the calculation of Gross Domestic Product (GDP) using the Income Method?
Question 9 of 20
Given below are two statements, one labeled as Assertion (A) and the other as Reason (R): Assertion (A): Central banks raising interest rates to combat inflation can precipitate an economic recession. Reason (R): Raising interest rates increases the cost of capital, which chokes off corporate borrowing and stifles private investment and consumer spending. Select the correct answer using the codes given below:
Question 10 of 20
Why do economists typically favor a low, predictable, and steady rate of inflation in an economy?
Question 11 of 20
Match the following Economic Periods/Indicators (List-I) with their corresponding Impact/Attributes (List-II): List-I 1. High GDP growth (2004-2008) 2. High CPI inflation (2012-2013) 3. Services Sector (Recent) 4. Agriculture Sector (Recent) List-II a. Anchors the economy with 56.4% share of GVA b. Rebounded due to healthy Kharif crop production c. Lifted hundreds of millions out of absolute poverty d. Severely hurt the unorganized sector due to wage rigidity
Question 12 of 20
The Production Method of calculating GDP evaluates the economic output by summing the gross value added across which specific sectors?
Question 13 of 20
Consider the following statements: 1. A U-Shaped recovery indicates that the economy quickly returns to its previous baseline without prolonged unemployment. 2. A Double-Dip recovery implies the economy falls back into contraction after a brief recovery. Which of the above is/are correct?
Question 14 of 20
How does Gross Domestic Product (GDP) function as an indicator of aggregate demand within an economy?
Question 15 of 20
Which of the following consequences systematically occurs during a recessionary phase regarding labor and financial markets?
Question 16 of 20
Assertion (A): GDP at Market Prices is inherently derived by incorporating government taxation and subsidization into the Gross Value Added (GVA). Reason (R): Subsidies are mathematically subtracted while Indirect Taxes are added to the GVA at basic prices to arrive at Market Prices. Choose the correct option:
Question 17 of 20
Indicators that change before the broader economy shifts, making them invaluable for forecasting future economic activity, are known as:
Question 18 of 20
Consider the following statements regarding the Monetary Policy Committee (MPC) in India: 1. It balances the dual statutory objectives of fostering maximum sustainable growth and maintaining absolute price stability. 2. It manages macroeconomic liquidity strictly through fiscal tools like direct taxation and public expenditure. Which of the statements given above is/are correct?
Question 19 of 20
In the macroeconomic formula for the Expenditure Method, GDP = C + I + G + (X - M), what does the term '(X - M)' explicitly represent?
Question 20 of 20