Business Economics Mock Test - 7 Free Online Test 2026

Markets for agricultural products like rice, wheat etc resemble perfectly competitive markets because there are a large number of producers, free entry and exit and products are identical.

Value added = Value of output in primary sector - Value of raw materials purchased by primary sector
= 800 - 400 
= 400

For full-bodied money, the money value and commodity value of the money are equal in the market. 

The difference between gross domestic product and net domestic product is due to depreciation.

An indifference curve is a locus of all such points, which show different combinations offering the same level of satisfaction to the consumer. It is always related to the choice and preference of the consumer.

Wealth is a stock variable.

An increase in the money supply increases the aggregate demand, as people now hold more money.

Gift tax belonged to direct taxes which does not have much significance in terms of revenue yield. It is not a non-tax receipt.

Note that the supply curve of C starts only above a price level of 15. Hence, at a price of Rs 10, only the supply curves of B and C are relevant.
q=qA+qB
⇒q=7p−10
At p=10, the quantity supplied is 60 units.

Profit maximization rule for a monopolistic competition is the same as that of a monopoly.
P >MC = MR

Imports = Exports - Balance of Trade = 700 - (-200) = 900

A consumer buys a commodity only when a rupee spent on it yields rupee worth of satisfaction (MU_M). A poor man stops the consumption of onion when he finds that a rupee spent on it does not yield rupee worth of satisfaction (no matter what quantity of onions is purchases), so that, Mux/P_X<Mu_M.

Tax that is imposed on value added at the various stages of production is known as value-added tax.

Deflationary periods often see depression or recession.

Both A and B. Economic problem is the problem of choice. It arises because resources are scarce and have alternative uses.

C + S = Y
At zero income level,
C = -S
When Y = 0, C = 300 + 0.8(0) = 300
Therefore, S = -300

Income of consumers who buy a good will only affects the demand for the good. All other factors will affect the supply.

The act of holding money as insurance against cases of emergency gives rise to precautionary demand.

Producer surplus, II is the area above the supply curve and below the price line.
It can be seen that at a price of $3
II =1/2×(3−1)×2=$2,

On account of an injection of aggregate demand, the equilibrium level of income increases.

Velocity of circulation of money is the number of times a rupee is used in transactions.

Fiscal deficit estimates borrowings.

This is part of a financial markets linkage.

All of these economists made an attempt to estimate the per capita income during the colonial period.

Point of inflexion is the point where the slope of the TP curve reaches the maximum and starts decreasing. At this point, MP is maximum.

Borrowings belong to the capital account.

The UK technology was capital intensive and labour saving and made sense in a high wage US economy.