The 20 one-mark questions from the March 2025 12th Standard Economics public exam, in paper order, with the correct option marked and a short explanation.
Q1
If the MPC is 0.5, the value of multiplier is __________.
- A. 0.2
- B. 2Correct
- C. 20
- D. 1/2
Explanation. Multiplier k = 1/(1 − MPC) = 1/(1 − 0.5) = 1/0.5 = 2.
Q2
The data collected by questionnaires are __________.
- A. Published data
- B. Primary dataCorrect
- C. Grouped data
- D. Secondary data
Explanation. Data collected first-hand by the investigator through questionnaires are primary data.
Q3
Which of the following is a direct tax ?
- A. Income taxCorrect
- B. Excise duty
- C. Service tax
- D. Customs duty
Explanation. Income tax is paid by the person on whom it is levied, so its burden cannot be shifted; excise, service tax and customs duty are indirect taxes.
Q4
When the prices rise slowly, we call it as :
- A. deflation
- B. galloping inflation
- C. mild inflationCorrect
- D. hyper inflation
Explanation. A slow, gradual rise in the price level is called mild (creeping) inflation.
Q5
Indicate the contribution of J.M. Keynes to Economics :
- A. Capital
- B. Wealth of Nations
- C. Public Finance
- D. General TheoryCorrect
Explanation. Keynes wrote "The General Theory of Employment, Interest and Money" (1936); Capital is by Karl Marx and Wealth of Nations by Adam Smith.
Q6
"Protection of the Environment Operations Act" was set up in __________.
- A. 1999
- B. 1997Correct
- C. 1996
- D. 1998
Explanation. The Protection of the Environment Operations Act was enacted in 1997.
Q7
Expansion of NITI Aayog :
- A. National Institution to Transform India
- B. National Institute of Transport India
- C. National Institution for Transforming IndiaCorrect
- D. National Institute for Trade in India
Explanation. NITI Aayog, which replaced the Planning Commission in 2015, stands for National Institution for Transforming India.
Q8
Which of the following is a Modern theory of International Trade ?
- A. Comparative cost
- B. Absolute cost
- C. Factor Endowment theoryCorrect
- D. None of these
Explanation. The modern theory of international trade (Ohlin) is based on factor endowments; absolute and comparative cost theories are classical theories.
Q9
The value of multiplier is __________.
- A. 1/(1 − MPC)
- B. 1/MPS
- C. 1/MPC
- D. Both (a) and (b)Correct
Explanation. k = 1/(1 − MPC), and since MPC + MPS = 1, 1 − MPC = MPS, so k = 1/MPS as well.
Q10
Alkali Soils are predominantly located in the __________ plains.
- A. North-Indian
- B. Gangetic
- C. Indus-Ganga
- D. All the aboveCorrect
Explanation. Alkali (saline-alkaline) soils are found mainly in the Indo-Gangetic plains of North India, so all the options apply.
Q11
Who coined the word 'Macro' ?
- A. J.M. Keynes
- B. Ragnar FrischCorrect
- C. Karl Marx
- D. Adam Smith
Explanation. The terms micro and macro economics were first used by Ragnar Frisch in 1933.
Q12
Which of the following plan has focused on the agriculture and rural economy ?
- A. Gandhian planCorrect
- B. People's plan
- C. Vishveshwarayya plan
- D. Bombay plan
Explanation. The Gandhian Plan (1944, S.N. Agarwal) stressed agriculture, cottage industries and a decentralised rural economy.
Q13
Primary Deficit (PD) = __________.
- A. Total Expenditure − Total Revenue
- B. Fiscal Deficit − Interest PaymentCorrect
- C. Total Revenue Expenditure − Total Revenue Receipts
- D. Budget Deficit − Government Market borrowings and liabilities
Explanation. Primary deficit is the fiscal deficit excluding interest payments: PD = FD − Interest payments. Option (c) defines revenue deficit.
Q14
2016 Demonetization of currency includes denominations of :
- A. ₹ 500 and ₹ 1000Correct
- B. ₹ 200 and ₹ 500
- C. ₹ 1000 and ₹ 2000
- D. Both (a) and (b)
Explanation. On 8 November 2016 the old ₹ 500 and ₹ 1000 notes were demonetised; ₹ 200 and ₹ 2000 notes were introduced afterwards.
Q15
The core of the classical theory of employment is __________.
- A. Law of Diminishing Returns
- B. Law of MarketsCorrect
- C. Law of Demand
- D. Law of Consumption
Explanation. The classical theory of employment rests on Say's Law of Markets: supply creates its own demand.
Q16
International Monetary Fund was an outcome of __________.
- A. Bretton Woods ConferenceCorrect
- B. Bandung Conference
- C. Singapore Conference
- D. Doha Conference
Explanation. The IMF and the World Bank were created at the Bretton Woods Conference held in 1944.
Q17
Primary sector is __________.
- A. Construction
- B. Trade
- C. Industry
- D. AgricultureCorrect
Explanation. The primary sector uses natural resources directly: agriculture, forestry, fishing and mining. Construction and industry are secondary; trade is tertiary.
Q18
Components of Balance of Payments of a country include the :
- A. Official Settlement account
- B. Capital account
- C. Current account
- D. All of the aboveCorrect
Explanation. The balance of payments has three components: current account, capital account and official settlement account.
Q19
SAARC meets once in __________ years.
- A. 2Correct
- B. 5
- C. 3
- D. 4
Explanation. According to the SAARC Charter, the summit of heads of state or government is held once in two years.
Q20
NABARD was started in __________.
- A. July 1982Correct
- B. July 1992
- C. July 1962
- D. July 1972
Explanation. NABARD was established on 12 July 1982 on the recommendation of the CRAFICARD (B. Sivaraman) Committee.
