Account and Finance Questions Practice Question and Answer

Q:

Gross Profit means–

247 0

  • 1
    Total investment over total savings
    Correct
    Wrong
  • 2
    Changes in methods of production
    Correct
    Wrong
  • 3
    Changes in the form of business organisation
    Correct
    Wrong
  • 4
    Total receipts over total expenditure.
    Correct
    Wrong
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Answer : 4. "Total receipts over total expenditure."
Explanation :

Gross profit = Net sales (total receipts) - Cost of goods  sold (total expenditure)

In other words it is the total receipt over total cost.

Q:

Which one of the following is not a method of measurement of National Income?

366 0

  • 1
    Value Added Method
    Correct
    Wrong
  • 2
    Income Method
    Correct
    Wrong
  • 3
    Investment Method
    Correct
    Wrong
  • 4
    Expenditure Method
    Correct
    Wrong
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Answer : 3. "Investment Method "
Explanation :

There are only three methods are using for calculating of national income i.e., value added method, income method and expenditure method.

Q:

Which of the following would not constitute an economic activity in Economics?

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  • 1
    A teacher teaching students in his college
    Correct
    Wrong
  • 2
    A teacher teaching students in a coaching institute
    Correct
    Wrong
  • 3
    A teacher teaching his own daughter at home
    Correct
    Wrong
  • 4
    A teacher teaching students under Sarva Shiksha Abhiyan Scheme
    Correct
    Wrong
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Answer : 3. "A teacher teaching his own daughter at home"
Explanation :

A teacher who is teaching his own daughter is not a part of economic activity as the imputed value of such activities can not be calculated.

Q:

Income and consumption are–

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  • 1
    Inversely Related
    Correct
    Wrong
  • 2
    Directly Related
    Correct
    Wrong
  • 3
    Partially Related
    Correct
    Wrong
  • 4
    Unrelated
    Correct
    Wrong
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Answer : 2. "Directly Related"
Explanation :

Consumption and income are directly or positively  related. An increase in income results in increase in consumption  and vice-versa.


Q:

A ‘Transfer Income’ is an–

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  • 1
    Income which is not produced by any production process
    Correct
    Wrong
  • 2
    Income taken away from one person and given over to another
    Correct
    Wrong
  • 3
    Unearned income
    Correct
    Wrong
  • 4
    Earned income
    Correct
    Wrong
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Answer : 1. "Income which is not produced by any production process"
Explanation :

Income which is not produced by any production process  is called transfer income. It is generally money received by  an individual or family from the state or other body, often the  pension or unemployment benefit.


Q:

GDP at factor cost equals–

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  • 1
    GDP – Indirect Tax + Subsidy
    Correct
    Wrong
  • 2
    GNP – depreciation
    Correct
    Wrong
  • 3
    NNP + depreciation
    Correct
    Wrong
  • 4
    GDP – subsidy + indirect tax.
    Correct
    Wrong
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Answer : 1. "GDP – Indirect Tax + Subsidy"

Q:

A rising per Capita Income will indicate a better welfare if it is accompanied by –

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  • 1
    Unchanged Income distribution overall.
    Correct
    Wrong
  • 2
    Changed Income distribution in favour of rich.
    Correct
    Wrong
  • 3
    Changed Income distribution in favour of poor.
    Correct
    Wrong
  • 4
    Changed Income distribution in favour of Industrial Labour.
    Correct
    Wrong
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Answer : 3. "Changed Income distribution in favour of poor."
Explanation :

A rising per Capita Income will indicate a better welfare if it is accompanied by changed Income distribution in favour of Poor.

Q:

The Effect of ‘Investment Multiplier’ is shows on–

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  • 1
    Employment
    Correct
    Wrong
  • 2
    Savings
    Correct
    Wrong
  • 3
    Income
    Correct
    Wrong
  • 4
    Consumption
    Correct
    Wrong
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Answer : 3. "Income "
Explanation :

Investment multiplier means those elements by which investment is increased and due to increasing of investment. There is increase in income and production. So effect of ‘Investment Multiplier’, according to above options is shown on income

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