The 20 one-mark questions from the March 2026 12th Standard Economics public exam, in paper order, with the correct option marked and a short explanation.
Q1
Who is regarded as the 'Father of Modern Macro Economics'?
- A. Ragnar Frisch
- B. Adam Smith
- C. Karl Marx
- D. J.M. KeynesCorrect
Explanation. J.M. Keynes, through his General Theory (1936), laid the foundation of modern macroeconomics, so he is called its father.
Q2
Identify the flow variable.
- A. IncomeCorrect
- B. Money supply
- C. Foreign Exchange reserves
- D. Assets
Explanation. A flow variable is measured over a period of time. Income is earned per period, whereas money supply, foreign exchange reserves and assets are stocks measured at a point of time.
Q3
Expansion for NNP is:
- A. National Net Provident
- B. Net National ProductCorrect
- C. Net National Provident
- D. National Net Product
Explanation. NNP stands for Net National Product, i.e. GNP minus depreciation.
Q4
The sum of MPC and MPS is __________.
- A. 0.1
- B. 1Correct
- C. 1.1
- D. 2
Explanation. Any addition to income is either consumed or saved, so ΔC/ΔY + ΔS/ΔY = 1, i.e. MPC + MPS = 1.
Q5
Keynes theory emphasized on __________ equilibrium.
- A. Very long run
- B. Very short run
- C. Long run
- D. Short runCorrect
Explanation. Keynes focused on short-run equilibrium, famously remarking that in the long run we are all dead.
Q6
The RBI Headquarters is located at __________.
- A. MumbaiCorrect
- B. Delhi
- C. Bengaluru
- D. Chennai
Explanation. The Reserve Bank of India has its central office in Mumbai (moved from Calcutta in 1937).
Q7
Irving Fisher's Quantity Theory of Money was popularized in __________.
- A. 1911Correct
- B. 1908
- C. 1914
- D. 1910
Explanation. Irving Fisher presented the transactions version of the quantity theory (MV = PT) in his book 'The Purchasing Power of Money' in 1911.
Q8
Central Bank is __________ authority of any country.
- A. Wage
- B. MonetaryCorrect
- C. National income
- D. Fiscal
Explanation. The central bank controls money supply and credit, so it is the monetary authority; fiscal policy is handled by the government.
Q9
Once the borrower fails to make Interest or Principal payments for __________ days the loan is considered to be a Non-Performing Asset.
- A. 60
- B. 30
- C. 180
- D. 90Correct
Explanation. As per RBI norms, a loan becomes a Non-Performing Asset when interest or principal remains overdue for 90 days.
Q10
In which sector Foreign Direct Investments is not permitted in India?
- A. Pharmaceutical
- B. Banking
- C. Insurance
- D. Atomic EnergyCorrect
Explanation. FDI is allowed (with limits) in pharmaceuticals, banking and insurance, but atomic energy is a prohibited sector for FDI in India.
Q11
In India, Economic policy reforms were started in the year:
- A. 1993
- B. 1991Correct
- C. 1994
- D. 1992
Explanation. India launched the New Economic Policy of liberalisation, privatisation and globalisation in July 1991.
Q12
The other name for Special Drawing Rights is __________.
- A. Quotas
- B. Voluntary Export Restrictions
- C. Paper goldCorrect
- D. None of the above
Explanation. SDRs, created by the IMF in 1969 as an international reserve asset, are popularly called paper gold.
Q13
World Bank is having its headquarters at:
- A. Vienna
- B. Washington D.C.Correct
- C. Geneva
- D. New York
Explanation. The World Bank (IBRD) is headquartered in Washington D.C., USA.
Q14
GST is equivalence of __________.
- A. Income tax
- B. Sales taxCorrect
- C. Local tax
- D. Corporate tax
Explanation. GST is an indirect tax on the supply of goods and services, so it is the equivalent of (and replaced) sales tax.
Q15
The objectives of Fiscal Policy is:
- A. Price stability
- B. Economic growth
- C. Full employment
- D. All of the aboveCorrect
Explanation. Fiscal policy aims at price stability, economic growth and full employment, so all the options are its objectives.
Q16
Acid rain is one of the consequences of __________.
- A. Land Pollution
- B. Air PollutionCorrect
- C. Noise Pollution
- D. Water Pollution
Explanation. Sulphur dioxide and nitrogen oxides released into the air combine with water vapour to form acid rain, so it results from air pollution.
Q17
Sustainable Development Goals and targets are to be achieved by __________.
- A. 2040
- B. 2030Correct
- C. 2050
- D. 2035
Explanation. The 17 Sustainable Development Goals adopted by the UN in 2015 are to be achieved by 2030 (Agenda 2030).
Q18
Which of the following country adopt Indicative Planning?
- A. Italy
- B. FranceCorrect
- C. Russia
- D. Germany
Explanation. France is the classic example of indicative planning, where the plan guides the private sector without compulsion; Russia followed imperative planning.
Q19
The Chairperson of NITI Aayog is __________.
- A. Vice-President
- B. Prime MinisterCorrect
- C. Finance Minister
- D. President
Explanation. The Prime Minister of India is the ex-officio Chairperson of NITI Aayog.
Q20
The term regression was first used by:
- A. Spearman
- B. Newton
- C. GaltonCorrect
- D. Pearson
Explanation. Sir Francis Galton first used the term regression in his study of the heights of parents and their children (regression towards the mean).
