Quiz 1 - 14/09/2024

Who is known as the father of Economics?

• Adam Smith

• Alfred Marshall

• J M Keynes

• David Ricardo

Answer explanation

Adam Smith is widely regarded as the father of Economics due to his influential work 'The Wealth of Nations', where he laid the foundations of classical economics and introduced key concepts such as the division of labor and free markets.

Want satisfying power of a commodity

• Consumption

• Utility

• Demand

• Consumer Equilibruim

Answer explanation

Utility refers to the satisfaction or pleasure derived from consuming a commodity. It captures the satisfying power of a commodity, making it the correct choice over consumption, demand, or consumer equilibrium.

Income tax is based on the principle of

• Ability to Pay

• Willingness to Pay

• Benefit received

• None of the above

Answer explanation

Income tax is based on the principle of 'Ability to Pay', meaning individuals contribute based on their financial capacity. This ensures a fair distribution of tax burdens, unlike 'Willingness to Pay' or 'Benefit received'.

GST stands for

• Goods and Sales Tax

• Goods and Service Tax

• Government Sales tax

• General Service Tax

Answer explanation

GST stands for Goods and Service Tax, which is a comprehensive tax on the supply of goods and services. The other options do not accurately represent what GST stands for.

The incidence of tax refers to

• The level and rate of taxation

• Who ultimately pays the tax

• 1. The growth of taxation

• 1. The way in which tax is collected

Answer explanation

The incidence of tax refers to who ultimately pays the tax, distinguishing between the legal obligation to pay and the actual burden borne by individuals or entities.

Agriculture, dairy, fishing, and forestry are examples of

• Secondary Sector

• Primary Sector

• Tertiary Sector

• None of the above

Answer explanation

Agriculture, dairy, fishing, and forestry are activities that involve the extraction of natural resources. These are classified under the Primary Sector, which focuses on the production of raw materials.

Who wrote "The Wealth of Nations"?

• Adam Smith

• Lionel Robinson

• J S Mill

• Irving FIsher

Answer explanation

Adam Smith wrote "The Wealth of Nations," published in 1776. It is a foundational text in classical economics, discussing the division of labor and free markets, distinguishing it from the other authors listed.

What is the main purpose of GST?

• To increase government revenue

• To simplify the tax structure

• To promote exports

• To regulate prices

Answer explanation

The main purpose of GST is to simplify the tax structure by consolidating multiple indirect taxes into a single tax, making compliance easier for businesses and improving efficiency in tax collection.

Which of the following is a characteristic of a monopoly?

• Many sellers

• Single seller

• Free entry and exit

• Perfect information

Answer explanation

A monopoly is characterized by a single seller dominating the market, unlike many sellers in perfect competition. This single seller controls the supply and pricing of the product, making 'Single seller' the correct choice.

What does the term 'inflation' refer to?

• Decrease in prices

• Increase in prices

• Stability of prices

• None of the above

Answer explanation

The term 'inflation' refers to an increase in prices of goods and services over time, which erodes purchasing power. Therefore, the correct answer is 'Increase in prices'.