100+ National Income MCQ and Answer with FREE PDF

National Income MCQ and Answer
National Income MCQ and Answer

National Income MCQ and Answers PDF are specially formulated to test your mastery of this topic. I hope you find it useful! This MCQ on National Income and answers session will help you in understanding the topic “National Income” with ease. It is accompanied by a FREE PDF that summarizes all information given in the MCQs. You can also find other Business related MCQs and Answers.

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Topic:National Income MCQ
No of Questions:100+
Question type:Multiple Choice Question
Question Format:Text & PDF
PDF Size:1 MB
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National Income MCQ and Answer

Q1. Which method is adopted in measuring National Income?
(a) Production Method
(b) Income Method
(c) Expenditure Method
(d) All of these

Answer: (d) All of these


Q2. Which sector is included in an economy?
(a) Primary
(b) Secondary
(c) Tertiary
(d) All of these

Answer: (d) All of these


Q3. Which of the following is not included in the calculation of Gross National Product?
(a) Purchase and Sale of Old commodities
(b) Intermediate Commodities
(c) (a) and (b) both
(d) None of the above

Answer: (c) (a) and (b) both


Q4. Which one of the following services are included in the Secondary Sector?
(a) Insurance
(b) Manufacturing
(c) Trade
(d) Banking

Answer: (b) Manufacturing


Q5. Which one is included in Primary Sector?
(a) Land
(b) Forest
(c) Mining
(d) All these

Answer: (d) All these


Q6. To include the value of goods or services more than one time while calculating National Income is called :
(a) Single Counting
(b) Double Counting
(c) Multiple Counting
(d) None of these

Answer: (b) Double Counting


Q7. Which one is a component of profit?
(a) Dividend
(b) Undistributed Profit
(c) Corporate Profit Tax
(d) All of these

Answer: (d) All of these


Q8. Which one is included in National Income?
(a) Transfer Earnings
(b) Sale proceeds of Shares and Bonds
(c) Black Money
(d) None of the Above

Answer: (d) None of the Above


Q9. Which one is included in the calculation of National Income?
(a) New Final Goods and Services
(b) Earned Income of Indian Companies in Abroad
(c) Expenses made by Foreign Tourists in the country
(d) All the above

Answer: (d) All the above


Q10. Which one is the limitation of Macro Economics?
(a) Collective Economic Paradox
(b) Ignores Individual Units
(c) Both (a) and (b)
(d) None of these

Answer: (c) Both (a) and (b)


Q11. Macro-economics is the study of:
(a) Principle or Theories of national income
(b) Consumer’s theory
(c) Production theory
(d) None of these.

Answer: (a) Principle or Theories of national income


Q12. Out of the following which is not a flow:
(a) Capital
(b) Income
(c) Investment
(d) Depreciation.

Answer: (a) Capital


Q13. From the following which method is used for measuring national income:
(a) Production method
(b) Income method
(c) Expenditure method
(d) All of the above.

Answer: (d) All of the above.


Q14. Which of the following is included in the primary sector:
(a) Land
(b) Forest
(c) Mines
(d) All of the above.

Answer: (d) All of the above


Q15. Total national income divided by total population is known as:
(a) Private income
(b) Personal income
(c) Personal spendable income
(d) Per capita income.

Answer: (d) Per capita income


Q16. Production enterprises are divided in:
(a) Two sectors
(b) Three sectors
(c) Four sectors
(d) Five sectors.

Answer: (b) Three sectors


Q17. Who had made the first attempt at National Income Accounting?
(A) Prof. D.R.Gadgill
(B) Simon Kuznets
(C) J.M.Keynes
(D) Gregory King

Answer: (D) Gregory King


Q18. Calculation of National Income at Market Prices is known as _________
(A) Money income
(B) Real income
(C) Non-monetary income
(D) None of these

Answer: (A) Money income


Q19. Accounting of National Income at constant prices is known as ________
(A) Money income
(B) Real income
(C) Current income
(D) Domestic income

Answer: (B) Real income


Q20. Which of the following items are excluded from GNP measurement?
(A) Purely financial transactions
(B) Transfer of used goods and non-market goods and services
(C) Illegal activities and the value of leisure
(D) All of these

Answer: (D) All of these


Q21. The subject of the Study of Macro Economics is:
(a) The Principle of National Income
(b) The Principle of Consumer
(c) The Principle of Producer
(d) None of these

Answer: (a) The Principle of National Income


Q22. Macro Economics Studies:
(a) Employment opportunities in the economy
(b) Theory of supply of Commodities
(c) Elasticity of demand in Scooter
(d) Price of wheat in the market

Answer: (a) Employment opportunities in the economy


Q23. General Price Level is studied in:
(a) Micro Economics
(b) Macro Economics
(c) Both (a) and (b)
(d) None of these

Answer: (b) Macro Economics


Q24. Employment Theory is related to :
(a) Static Economics
(b) Micro Economics
(c) Macro Economics
(d) None of these

Answer: (c) Macro Economics


Q25. Increase in Stock of Capital is known as:
(a) Capital Loss
(b) Capital Profit
(c) Capital Formation
(d) None of these

Answer: (c) Capital Formation


Q26. Which of the following is sPktock ?
(a) Wealth
(b) Saving
(c) Export
(d) Profit

Answer: (a) Wealth


Q27. Which one of the following is included in circular flow?
(a) Real Flow
(b) Money Flow
(c) Both (a) and (b)
(d) None of these

Answer: (c) Both (a) and (b)


Q28. Which one of the following is included in ‘Stock’?
(a) Quantity of Money
(b) Wealth
(c) Quantity of wheat stored in a warehouse
(d) All the above

Answer: (d) All the above


Q29. Which one is included inflow ?
(a) Consumption
(b) Investment
(c) Income
(d) All of these

Answer: (b) Investment


Q30. Which of the following is included in real flow?
(a) Flow of Goods
(b) Flow of Services
(c) Both (a) and (b)
(d) None of these

Answer: (c) Both (a) and (b)


Q31. Which services are provided by families to a firm?
(a) Land
(b) Labour
(c) Capital and Enterprises
(d) All the above

Answer: (d) All the above


Q32. Which one is included in the three-sector model?
(a) Family
(b) Firm
(c) Government
(d) All of these

Answer: (d) All of these


Q33. Which one is included in the four-sector model?
(a) Family, Firm, Industry
(b) Family, Firm, Government
(c) Family, Firm, Government, Foreign Sector
(d) None of the above

Answer: (c) Family, Firm, Government, Foreign Sector


Q34. Which is the equilibrium condition of circular flow in the four sector model?
(a) C + I
(b) C + I + G
(c) C + I + G + (X-M)
(d) None of these

Answer: (c) C + I + G + (X-M)


Q35. The primary sector includes:
(a) Agriculture
(b) Retail trading
(c) Small Industries
(d) All the these

Answer: (d) All the these


Q36. For a four sector or open economy the condition for equilibrium is:
(a) Savings + taxes + Imports = Investment + govt, expenditure + exports
(b) Total Leakages = Total Injections
(c) Aggregate output = Aggregate Expenditure
(d) All of these

Answer: (d) All of these


Q37. Which service is included in Tertiary Sector?
(a) Mining
(b) Construction
(c) Communication
(d) Animal Husbandry

Answer: (c) Communication


Q38. Which of the following is not flow?
(a) Capital
(b) Income
(c) Investment
(d) Depreciation

Answer: (a) Capital


Q39. The market price of all final goods of a country in a year is known as:
(a) GDPMP
(b) GDPFC
(c) NNPFC
(d) None of these

Answer: (a) GDPMP


Q40. Which one is true?
(a) GNP = GDP + Depreciation
(b) NNP = GNP + Depreciation
(c) NNP = GNP – Depreciation
(d) GNP = NNP – Depreciation

Answer: (c) NNP = GNP – Depreciation


Q41. GNPMp =?
(a) GDPMp – Depreciation
(b) GDPMp + Net Factor Income from Abroad
(c) GNPMp + Subsidy
(d) None of the above

Answer: (b) GDPMp + Net Factor Income from Abroad


Q42. NNPMP = ?
(a) GNPMp – Depreciation
(b) GNPMp + Depreciation
(c) GNPMp + Indirect Tax
(d) None of the above

Answer: (a) GNPMp – Depreciation


Q43. Depreciation expenses are included in:
(a) GNPMp
(b) NNPMp
(c) NNPFC
(d) None of these

Answer: (a) GNPMp


Q44. NDPFC = ?
(a) NDPMP – Indirect Tax
(b) GNPMP – Indirect Tax + Subsidy
(c) NDPMP – Subsidy
(d) NDPMF – Depreciation

Answer: (b) GNPMP – Indirect Tax + Subsidy


Q45. Net National Income at Factor Cost is called?
(a) National Income
(b) Gross Investment
(c) Domestic Income
(d) None of these

Answer: (a) National Income


Q46. Which one is included in National Income?
(a) Rent, Wage, Interest
(b) Rent, Wage, Salary
(c) Rent, Profit, Interest
(d) Rent, Wage, Salary, Interest, Profit

Answer: (d) Rent, Wage, Salary, Interest, Profit


Q47. What is the consumption of fixed capital called?
(a) Capital formation
(b) Depreciation
(c) Investment
(d) All of these

Answer: (b) Depreciation


Q48. Which of the following is correct?
(a) Disposable Income = Personal Income – Direct Taxes
(b) Disposable Income = Private Income – Direct Taxes
(c) Disposable Income = Personal Income – Indirect Taxes
(d) Disposable Income = Private Income – Indirect Taxes

Answer: (a) Disposable Income = Personal Income – Direct Taxes


Q49. If for a country net factor income from abroad is negative then:
(a) GDP < GNP
(b) GDP > GNP
(c) GDP ≥ GNP
(d) GDP = GNP

Answer: (b) GDP > GNP


Q50. The market value of all final goods and services produced in an economy over a year is called :
(a) Gross National Product
(b) National Income
(c) Gross Domestic Product
(d) Net National Product

Answer: (c) Gross Domestic Product


Q51. GNP at MP = ______
(A) GDPMP – Depreciation
(B) GDPMP + Depreciation
(C) GDPMP ÷ Depreciation
(D) GDPMP + Net factor income from abroad

Answer: (A) GDPMP – Depreciation


Q52. NDPMP = ________
(A) GDPMP – Depreciation
(B) GDPFC + Net factor income from abroad
(C) NNPFC + Net indirect taxes
(D) All of these

Answer: (A) GDPMP – Depreciation


Q53. NNPMP = ________
(A) GNPMP – Depreciation
(B) NDPMP + Net factor income from abroad
(C) NNPFC + Net indirect taxes
(D) All of these

Answer: (D) All of these


Q54. GDPFC =
(A) GDPMP – Net indirect taxes
(B) GDPMP + Net indirect taxes
(C) GDPMP + Subsidies
(D) GDPMP – Indirect taxes

Answer: (A) GDPMP – Net indirect taxes


Q55. NDPFC =
(A) GDPFC – Indirect taxes
(B) GDPFC – Depreciation
(C) GDPFC + Economic subsidy
(D) All of these

Answer: (B) GDPFC – Depreciation


Previous Year’s Quiz and Answers on National Income

QuestionsAnswers
The national income is equal toSum total of factor incomes
National income does not includeThe sale of second-hand goods is not included in the national income.
National income is estimated byNational Statistical Office (NSO)
National income is expressed onSum total of factor incomes
National income is which conceptSum total of factor incomes
Which shows the equilibrium of national incomeSaving = investment

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FAQs on National Income

1. What is the national income formula?

Answer: National Income = C (household consumption) + G (government expenditure) + I (investment expense) + NX (net exports).

2. What is the national income and how it is calculated?

Answer: The national income is calculated by adding the total output of the companies in the economy. If you add up the total profit and loss, if all these companies belong to you, your income will be called national income or GDP. Based on this calculation, we can see which sectors contribute more than others to the total output.

3. What is a national income example?

Answer: National income is the value of goods and services produced by a country during a financial year. Therefore, it can be said that national income means how much money a country earns in a particular period of time.

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