Economics M.C.Q (1 Marks)

Exchange rate for currencies is determined by supply and demand in system of:

Apart from currency notes and coins, the balance in ________, held by the public in commercial banks is also considered money since the amount in these accounts can be used to settle transactions. Such deposits are called demand deposits because they are payable by the bank on demand from the account-holder.

Suppose in a hypothetical economy, the income rises from ₹ 5,000 crores to ₹ 6,000 crores. As a result, the consumption expenditure rises from ₹ 4,000 crores to ₹ 4,600 crores. Marginal propensity to consume in such a case would be ________.

In order to correct the situation of deficient demand

Suppose in a hypothetical economy, the income rises from ₹ 5,000 crores to ₹ 6,000 crores. As a result, the consumption expenditure rises from ₹ 4,000 crores to ₹ 4,600 crores. Marginal propensity to consume in such a case would be___________.

A rise in the interest rates at home leads to ________ of the domestic currency.

The value of ________ can never be negative, while ________ can have a value equal to one.

Which is not a function of a commercial bank?

Statement I: Since it is difficult to record all international economic transactions accurately, therefore we have a third element of BoP (apart from the current and capital accounts) called errors and omissions which reflects this.
Statement II: Any international transaction which results in outflow of foreign exchange is recorded on the credit side in the balance of payments accounts (the current account or capital account).