Concepts of Micro and Macro Economics

General Knowledge Test with questions about different types of economies for exams like UPSC, SSC, UPPSC, Banking, RPSC, MPSC, KAS, MPPSC, and others.

1. If an increase in the price of one commodity leads to a decrease in the demand for another commodity, what are these commodities called?

  1. Substitute goods
  2. Complementary goods
  3. Inferior goods
  4. Normal goods
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Answer: Option B. Complementary goods

2. Which of the following pairs is not an example of complementary goods?

  1. Tea and Coffee
  2. Coffee and sugar
  3. Bread and butter
  4. Pen and notebook
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Answer: Option A. Tea and Coffee

3. Which of the following is the best example of double counting in national income?

  1. Counting only the final product
  2. Counting only the value added at each stage
  3. Counting the value of exports and imports separately
  4. Counting the value of raw materials and the final product
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Answer: Option D. Counting the value of raw materials and the final product

4. What happens to the market price if both demand and supply of a commodity increase by the same absolute amount?

  1. Market price remains unchanged
  2. Market price increases
  3. Market price decreases
  4. Market price fluctuates
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Answer: Option A. Market price remains unchanged

5. How does core inflation differ from general inflation?

  1. Core inflation includes all items in the consumer basket
  2. Core inflation is always higher than general inflation
  3. Core inflation excludes volatile items like food and energy
  4. Core inflation is measured monthly
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Answer: Option C. Core inflation excludes volatile items like food and energy