Nta Ugc Net Economics - Answer Key 2020 September 1

NTA UGC NET ECONOMICS – ANSWER KEY 2020 SEPTEMBER
Apple B UGC Net JRF Academy, NSS Golden Jubilee Building, Pala, Kottayam, Kerala
Q1. Match List – I with List – II D. Solow
List – I Options
A. Effectiveness in private market in 1. BACD

dealing with externalities 2. CDBA
B. Relationship between increase in tax 3. ACDB
rate and tax revenue 4. DBAC
C. Dominant strategy
D. Controlling prices through effective ANS: 1
price ceiling and a price floor Q4. What is the maximum penalty to be
imposed under the Negotiable Instrument Act
List – II
for bouncing of a cheque?
I. Laffer curve
1. 6 months
II. Deadweight Loss
2. One year
III. Coase Theorem
3. 2 years
IV. Game Theory
4. 5 years
Options
ANS:3
1. A-III, B-I, C-IV, D-II
2. A-IV, B-I, C-II, D-III Q5. Given the total revenue function, TR =
1400Q -6Q2 and total cost function, TC =
3. A-I, B-III, C-II, D-IV
1500+80Q at Q= 100 units (where Q is the
4. A-III, B-I, C-II, D-IV
amount of output), which one of the following
ANS:1 is correct ?
Q2. The number of districts initially selected A. MR > MC

from the states under the Intensive Area B. MC = 80
Development Programme (1960) C. MR < MC
D. MR = MC
1. One district from each state
2. Three districts from three states Options
3. Five districts from five states
1. A and B are true only
4. Seven districts from seven states
2. B and C are true only
ANS: 4 3. B and D are true only
4. Can’t be defined
Q3. Arrange the following growth economists in
chronological order of when they proposed ANS:1
their theories
Q6. Account payee crossing is defined in which
A. Harod section of the Negotiable Instruments (NI) Act?
B. Schumpeter
1. Section 123
C. Rostow
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2. Section 124 D. The marginal product of capital is given
3. Section 125 by β Q/K
4. Not defined in NI act Options
1. A , B and C only
ANS:4 2. A, B and D only
Q7. Assertion (A) : Compared to a certain point 3. A, C and D only
on the contract curve, a point above the 4. A, B, C and D only
contract curve is efficient ANS: 2
Reason (R): The contract curve represent the Q10. Labour force participation rate is given by
locus of points where the marginal rate of
substitution between two goods is the same for 𝐿𝑎𝑏𝑜𝑢𝑟𝑓𝑜𝑟𝑐𝑒
1. * 100
𝑇𝑜𝑡𝑎𝑙𝑝𝑜𝑝𝑢𝑙𝑎𝑡𝑖𝑜𝑛
both the individuals 𝑁𝑜.𝑜𝑓𝑙𝑎𝑏𝑜𝑢𝑟𝑠𝑒𝑚𝑝𝑜𝑙𝑦𝑒𝑑
2. 𝑙𝑎𝑏𝑜𝑢𝑟𝑓𝑜𝑟𝑐𝑒
* 100
1. Both A are R are correct, R is the correct 𝐿𝑎𝑏𝑜𝑢𝑟𝑓𝑜𝑟𝑐𝑒
3. 𝐴𝑑𝑢𝑙𝑡𝑝𝑜𝑝𝑢𝑙𝑎𝑡𝑖𝑜𝑛
* 100
explanation of A
𝑁𝑜.𝑜𝑓𝑙𝑎𝑏𝑜𝑢𝑟𝑠𝑒𝑚𝑝𝑜𝑙𝑦𝑒𝑑
2. Both A are R are correct, R is not the 4. * 100
𝐴𝑑𝑢𝑙𝑡𝑝𝑜𝑝𝑢𝑙𝑎𝑡𝑖𝑜𝑛
correct explanation of A
3. A is correct but R is not correct ANS:3
4. A is not correct but R is correct
Q11. Banking cash transaction tax (BCTT)
ANS:4 was introduced with effect from
Q8. Growth rate of population is 1. 1stJan 2015

2. 1stJune 2005
1. Rate at which population increases per 3. 1stJan 2019
1000 annum 4. 1stJune 2009
2. Rate at which birth rate increases per
annum ANS: 2
3. Rate at which population increases per
Q12. Maximum social welfare is guaranteed
10000 annum
where a competitive firm exhibits the following
4. Rate at which fertility increases per
conditions (where MRPTxy is marginal rate of
annum
product transformation of x for y)
ANS:1 𝑝𝑟𝑖𝑐𝑒 𝑜𝑓 𝑥 (𝑝𝑥)
1. MRPTxy= =
𝑝𝑟𝑖𝑐𝑒 𝑜𝑓 𝑦 (𝑝𝑦)
Q9. For the production function Q= ALαKβ 𝑚𝑎𝑟𝑔𝑖𝑛𝑎𝑙 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑥 (𝑀𝐶𝑥)
𝑚𝑎𝑟𝑔𝑖𝑛𝑎𝑙 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑦 (𝑀𝐶𝑦)
A. The coefficient A shows managerial (𝑝𝑥) 𝑇𝑜𝑡𝑎𝑙 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑥
2. MRPTxy= (𝑝𝑦) = 𝑇𝑜𝑡𝑎𝑙 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑦
efficiency
(𝑝𝑥) 𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑣𝑎𝑟𝑖𝑎𝑏𝑙𝑒 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑥
B. If α+β > 1, then the production function 3. MRPTxy= (𝑝𝑦) = 𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑣𝑎𝑟𝑖𝑎𝑏𝑙𝑒 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑦
exhibits increasing returns to scale (𝑝𝑥) 𝑇𝑜𝑡𝑎𝑙 𝑣𝑎𝑟𝑖𝑎𝑏𝑙𝑒 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑥
4. MRPTxy= (𝑝𝑦) = 𝑇𝑜𝑡𝑎𝑙 𝑣𝑎𝑟𝑖𝑎𝑏𝑙𝑒 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑦
C. Marginal rate of technical substitution
of L for K is given by βk/ αL ANS: 1

Q13. The cost of holding money by Q15. A graph reflecting the relationship
individuals between a country’s per capita income and its
inequality of income distribution is the
A. Loss of real value of money due to
deflation 1. Lorenz curve
B. Foregone interest from savings 2. Phillips curve
C. Utility forgone by not buying goods and 3. Laffer curve
services 4. Kuznets curve
D. Returns forgone by not holding other
assets ANS: 4
Options Q16. Match List – I with List II
1. B C AND D List – I
2. A B AND C A. Rybezynski Theorem
3. A B AND D B. Metzler effect
4. A C AND D C. Stolper Samuelson Theorem
ANS: 1 D. Immiserising growth
Q14. Match List – I with List – II List – II
List – I I. The effect of tariff on factor prices

II. The effect of factor growth on
A. Linear function production and trade
B. Quadratic function III. The effect of tariff on domestic
C. Exponential function prices
D. Power function IV. The effects of growth on terms of
trade
List – II
Options
I. Y = 3x2 + 2x + 9
II. Y = 5x3 1. A II, B III, C I, D IV
III. Y = 3e2x 2. A IV, B III, C I, D II
IV. Y = 5x + 3 3. A IV, B I, C III, B II
4. A II, B I ,C III, D IV
Options
ANS:1
1. A IV, B I, C III, D II
2. A IV, B I, C II, D III Q17. Statement I: Industrialization strategy
3. A IV, B II, C III, D I advocates trade and development to overcome
4. A I, B II, C III, D IV market failures through government policy
ANS: 1 Statement II : It encourages technology transfer

and export of progressively more advanced
products

Choose the correct answer: I. Small group model
II. Kinked demand curve
1. Both the statement are false III. Price leadership model
2. I is true II is false IV. Reaction curves
3. I is false and II is true
4. Both are true Options:
ANS:4 1. A I, B III, C IV, D II

2. A II, B I, C III, D IV
Q18. Assertion (A) : Marshall – Lerner condition 3. A II, B I, C IV, D III
should be fulfilled for the success of devaluation 4. A I, B II, C IV, D III
Reason (R): Devaluation makes exports costly ANS:4
and imports cheaper
Q21. Based on the order, state whether the first
1. Both A are R are correct, R is the correct
equation is identified?
explanation of A
2. Both A are R are correct, R is not the Given the following structural model
3. A is correct but R is not correct Y1 = 3y2 – 3x1 + x2 + u1
4. A is not correct but R is correct Y2 = y3 + x3 + u2
ANS:3 Y3 = y1 – y2 – 2x3 + u3
Q19. Cross elasticity of demand of metro rides Where y’s are the endogenous variables, x’s are
is 0.8 and total ridership per day 1.5 lakh. If predetermined variables and u’s are random
price of bus ride rises by 5% the change in total
metro rides will be 1. Over identified
2. Under identified
1. 4000 3. Exactly identified
2. 5000 4. Information not sufficient
3. 6000
4. 7500 ANS: 3
ANS:3 Q22. Markowitz theory of portfolio

management considers which of the following
Q20. Match List – I with List – II assumptions?
List – I A. Investors are pessimistic about start ups
A. Chamberlin but optimistic about an established
business
B. Sweezy
C. Stackelberg B. Investors have free access to fair and
correct information on return and risk
D. Fellner
C. Investors have a tendency to lean
List – II forwards a crypto currencies

D. Investors are rational and maximize 1. Real GDP
their utility with a given level of income 2. Net Domestic Product
and money 3. Nominal GDP
4. Gross National Product
Choose the correct answer
ANS:3
1. A AND B
2. B AND D Q26. Statement I : The Rybczynski theorem
3. C AND D postulates that at constant commodity prices
4. A AND C an increase in the endowment of one factor will
increase by a greater proportion the output of
ANS: 2 commodity, intensive in that factor and will
Q23. Which of the following statement is wrong reduce the output of the other country
1. 67% of Indian agriculturalists are Statement II : The Stolper – Samuelson theorem

marginal land holders with less than 1 postulates that an increase in the relative price
hector of a commodity ( for example as a result of a
2. 10% of agriculturalists have 10 hectors tariff) decreases the return or earnings of the
or more factor used intensively in the production of the
3. In the rural sector, land is the principle commodity
source of income Choose the correct answers
4. Due to the high growth of population,
the average size of landholdings is small 1. Both are true
2. Both are false
ANS:2 3. I is true II is false
Q24. Market failure is caused to the presence of 4. I is correct II is true
A. Poverty ANS: 3
B. Externalities Q27. “The best system of taxation from the
C. Market power economic point of view is that which has the
D. Private goods best or the least bad economic effects “. Who
Choose the correct answer said this?
1. A and B 1. Musgrave
2. B and C 2. Marshall
3. B , C and D 3. Hugh Dalton
4. B and C 4. Pigou
ANS: 2 4 ANS:3
Q25. GDP expresses in the terms of current Q28. Overshooting model of exchange rate
price is called developed by economists Rudi Dornbush,
attempts to establish

1. The fact why the foreign exchange
market is never in equilibrium
2. Relationship between sticky prices and
volatile exchange rates
3. The fact that forward rates of exchange
are no good predictors of future spot
Is given by
rates of exchange
4. No relationship between sticky prices 1. Value of the game = 2. Best strategy for
and volatile exchange rates player A and B are (A1,B1)respectively
2. Value of the game = 2. Best strategy for
ANS: 2 player A and B are (A1,B1) or (A3,B1) or
Q29. The concept of Good and Services Tax (A1,B3) respectively
(GST) is originated in 3. Value of the game = 2. Best strategy for
player A and B are (A3,B1)respectively
1. Canada 4. Value of the game = 2. Best strategy for
2. Britain player A and B are (A1,B3)respectively
3. Germany
4. USA ANS: 2
ANS: 1 Q32. Presence of asymmetric information in

the market causes which of the following?
Q30. Which one of the following response is
true as a solution for simultaneous equation A. Adverse selection
bias? B. Marginal benefits of an additional unit
of resources diminish with an increasing
A. OLS method number of unit of resources
B. Principle Component Method C. Efficiency wages
C. Two – stage Least Square Method ( 2 D. Principal – agent problem
SLS method )
D. Full Information Maximum Likelihood Choose the correct answer
method (FIML) 1. A B and D
Choose the correct option 2. B C and D
3. A and D
1. A and B are true 4. A and C
2. B and C are true
3. C and D are true ANS:3
4. A and D are true
Q33. Seigniorage in banking means
ANS:3 A. The economic cost of providing a
Q31. The solution of the following game current within a given economy
B. The difference between the face value
of money and the cost of providing it

C. The cost involved in running ATM’s C. Singapore
D. The cost of making debit/credit card in D. Srilanka
the economy
Choose the correct answers
1. C and D only
1. A and C only 2. B and C only
2. B and C only 3. A and D only
3. B and D only 4. A and B only
4. A and B only
ANS:4
ANS: 4
Q37. Which of the situations represents an
Q34. Statement I : Learning curve effect is economic investment in the national income
related to a firm’s long run average cost curve calculation?
Statement II : A swapped allocation is one that A. Buying a newly constructed house for
is Pareto efficient as well as an equitable self occupation
allocation B. Buying of new shares
C. Buying a new car by a publishing house
Choose the correct answers for delivering books
1. Both are true D. Buying a new car by a household
2. Both are false
3. I is correct, II is false
4. I is false, II is true 1. A B and C
2. A B C and D
ANS:1 3. A C and D
Q35. The share of the service sector in the gross 4. A and D
value added of India at current prices during
ANS:4
2018-2019 is between
Q38. Inadequacy or absence of KYC (know your
1. 45 to 47 percent Customer) standards can subject a bank to
2. 50 to 52 percent serious and counter party risks as follows
3. 53 to 55 percent
4. 60 to 62 percent A. Reputation risk
B. Compliance risk
ANS:3 C. Legal risk
Q36. According to economic survey 2019, the D. Bankruptcy risk
top 5 trading partners of India continue to be Choose the correct answer
USA, China and UAE and
1. A B and D
A. Saudi Arabia 2. A B and C
B. Hong Kong 3. B C and D

4. A C and D 1. Strictly stationery
2. Non stationery
ANS:2 3. Weakly stationery
Q39. Assertion (A) : High powered money is the 4. Can’t be defined
source of all other forms of money that impact ANS: 3
money supply
Q43. Which of the following are the three
Reason (R): Credit is created by commercial states, which secured the highest percentage
banks state-wiseshare of tax revenue among states, as
1. Both A are R are correct, R is the correct per recommendations of the 14th finance
explanation of A commission?
2. Both A are R are correct, R is not the A. Uttar Pradesh
correct explanation of A B. Bihar
3. A is correct but R is not correct C. Madhya Pradesh
4. A is not correct but R is correct D. Andhra Pradesh
ANS:2 Choose the most appropriate answer
Q40. For any two equally likely, exhaustive and 1. A B and D only
independent events A and B, P(AB) will be equal 2. A C and D only
to 3. A B and C only
1. 0 4. B C and D only
2. 0.25 ANS:3
3. 0.50
4. 1 Q44. Assertion (A) : The main cause of
commercial bank failure is because of providing
ANS: 2 inappropriate loans to bank insiders
Q41. A growth model in which there are Reason (R) : Bank employees are provided loans
diminishing returns on each factor of at lower interest rates
production but constant returns to scale and
exogenous technological changes that generate Choose the appropriate answer
long term economic growth is the
1. Leibenstein model explanation of A
2. A K Sen model 2. Both A are R are correct, R is not the
3. Kalecki Model correct explanation of A
4. Solow model 3. A is correct but R is not correct
ANS:4
ANS: 2
Q42. Time series under the condition (Ext) = µ
and cov (xt,xt+k) = Y(K) is said to be

Q45. Arrange the following in chronological innovation and knowledge leads to economic
order growth
A. Rational expectation Doctrine Statement II : Investment in human capital,

B. Keynesian economics innovation and knowledge reduces the
C. Monetarism diminishing returns on investment
D. Classical economics
Choose the most appropriate answer
1. Both are true
1. BDCA 2. Both are false
2. ADCB 3. I is correct, II is false
3. ABCD 4. I is false, II is true
4. DBCA
ANS:1
ANS: 4
Q48. Given the total cost TC = Q3 – 10Q2 + 6Q,
Q46. Match List – I with List – II what will be the minimum average cost ? At
what level of output will the minimum cost
List –I occur ? (Q is the level of output)
A. Absolute advantage theory of 1. Minimum average cost is ACmin = 35 at
international trade Q=5
B. Factor proportion theory of trade
2. Minimum average cost is ACmin = 175 at
C. Offer curve Q=5
D. Opportunity cost 3. Minimum average cost is ACmin = 170 at
List – II Q=1
4. Minimum average cost is ACmin = 45 at
I. Heckscher – Ohlin Q=1
II. Marshall
III. Adam Smith ANS:1
IV. Haberler Q49. Statement I : Mrs. Ursula K Hicks stated
Choose the correct option that, “Private finance whether of firms of
individuals, starts with a given income plan as a
1. A I, B III, C II, D IV framework within which expenditure must be
2. A III, B I, C II, D IV planned: public finance, on the contrary, starts
3. A I, B III, C IV, D II with a given expenditure plan and the
4. A III, B I, C IV, D II authorities adjust their income by means of
taxes and resources to match the expenditure”
ANS:2
Statement II: Prof. Shiras pointed Out that
Q47. Statement I : The endogenous growth
“public authorities differ from private
theorists suggest, investment in human capital,
expenditure in that the former should balance

income and should not necessarily seek a profit Q52. Based on the following Blacker’s stages of
in the manner that an individual would” population growth diagram, the portion
between A, B and C implies
1. Both are true

2. Both are false
3. I is correct, II is false
4. I is false, II is true
ANS:1
Q50. Assertion (A): According to Walt W

Rostow, the principle strategy of development 1. Stages of low stationary
necessary for take-off was the mobilization of 2. Population declining
domestic and foreign savings 3. Early expanding
4. Late expanding
Reason (R): mobilization of domestic and
foreign savings is necessary to generate ANS:3
sufficient investment to accelerate economic
Q53. According to the last census (2011), which
growth
Indian State has the minimum sex ratio?
1. Punjab
1. Both A are R are correct, R is the correct 2. Delhi
explanation of A 3. Bihar
2. Both A are R are correct, R is not the 4. Haryana
ANS:4
3. A is correct but R is not correct
4. A is not correct but R is correct Q54. For the given income consumption curve
in the diagram, which one of the following is
ANS:1
correct
Q51. Given the sample size 400 with the sample
mean 99, the population mean 100 and
computed value of z statistic at 2.5, the value of
population standard deviation will be
1. 59.17
2. 123.46
3. 8
4. Cannot be determined 1. Good x is inferior and good y is normal
2. Good y is inferior and good x is normal
ANS:3 3. Good x and good y are normal
4. Good x and good y are inferior

ANS:2 1. A IV, B II, C I, D III
2. A I, B III, C II, D IV
Q55. A decision free framework to identify a 3. A II, B I, C III, D IV
country’s most binding constraints on economic 4. A IV, B I, C III, D II
growth is termed as
ANS:1
1. Growth paradigm
2. Growth diagnostics Q58. Which one of the following price index
3. Growth stimulus numbers satisfies the factor reversal test?
4. Growth paradox
1. Lapspeyres price index
ANS:2 2. Paasche’s price index
3. Walsh’s price index
Q56. Who said, “I believe that the objective for
4. Fisher’s price index
disinvestment should be to benefit the public,
the consumer and the investor at the same time ANS:4
to improve competitiveness and eliminates
monopoly? Q59. Assertion(A): If A is any Matrix given by A
1. Manmohansingh
2. George Fernandes
3. Chidambaram
4. YashwantSinha Then det A = 0, since all elements in column II
are zero
ANS:2
Reason (R): Laplace expansion permits
Q57. Match List – I with List – II evaluation of a determinant along any row or
column
List – I
A. Kerala
explanation of A
B. Punjab
2. Both A are R are correct, R is not the
C. Himachal Pradesh
D. Madhya Pradesh
3. A is correct but R is not correct
List – II 4. A is not correct but R is correct
I. Least urbanized ANS:1

II. Highest percentage of S.C’s in their
Q60. Forward exchange rates are useful for
population
those who wish is
III. Highest percentage of S.T’s in their
population A. Protect themselves from the risk that
IV. Highest sex ratio the exchange rate will change before a
transaction is completed
Options
B. Gamble that a currency will rise in value

C. Gamble that a currency will false in Q63. If no industry (sector) draws its own
value output as input, then the principle diagonal
D. Exchange currencies at a point in time element in the technological coefficient matrix
in the future will be
Choose the correct answer 1. -1

2. +1
1. A B and C only 3. Zero
2. A and B only 4. Infinity
3. A and C only
4. ABCD ANS:3
Q64. The combined liabilities of Centre and

states as a percentage of GDP during the two
ANS:4 years 2016-2017 and 2017-2018 consolidated is
Q61. Harrod – Domar considers a functional at
economic relationship in which the growth rate 1. 69 percent
of the gross domestic product depends 2. 67 percent
A. Directly on the national net savings rate 3. 68 percent
B. Inversely on the national capital – 4. 66 percent
output ratio ANS:2
C. Directly on industrial growth
D. Inversely on agricultural growth Q65. Which one of the following is not the
objective of IMF?
1. To promote international monetary
1. A and B cooperation
2. A and C 2. To ensure balanced international trade
3. B and D 3. To ensure exchange rate stability
4. C and D 4. To provide loans to the private sector
ANS:1 ANS:4
Q62. What type of relationship exists between Q66. What is the value of the equilibrium level
two variables, if all points on the scatter of income for the data given below for an
diagram appear to fall on a straight line going economy?
upward from left to right?
C = 50+ 0.8Yd
1. Positive correlation
2. Perfect positive correlation t = 20%
3. Negative correlation
I = 100
4. Perfect positive correlation
G = 30
ANS:2

1.400 ANS:1
2.300 Q70. Changes in terms of trade typically put less

developed countries at a disadvantage, because
3.500
1. They specialize and trade in agricultural
4.600 goods rather than manufactured goods
ANS: 3 2. They have higher labour cost
3. They specialize and trade in services like
Q67. Given the production function Q = 10 L0.8 tourism
K0.2 , the marginal product of labour (MPL) and 4. Industrialized countries practice unfair
capital (MPk) respectively are given by trade with less developed countries
A. MPL = 8 (K/L)0.2 ANS:1

B. MPL = 8 (L/K)0.2
C. MPK = 2 (L/K)0.2 Q71. Match List – I with List – II
D. MPK = 2 (K/L)0.2 List – I
Choose the correct answer A. Karl Marx theory of population growth
1. A and D are true B. Blacker’s theory of population growth
2. A and C are true C. Landry’s theory of population growth
3. B and C are true D. Prof. Sidgwick’s optimum population
4. B and D are true theory
ANS:2 List – II
Q68. In the study of international economics, 1. Static interpretation

we use the tool of 2. Three stages
3. Four stages
1. Microeconomic theory only 4. Five stages
2. Macroeconomic theory only
3. Neither micro nor macro economic Choose the correct answer
theory 1. A IV, B II, C I, D III
4. Both micro and macro economic theory 2. A I, B III, C II, D IV
but we all extend, adapt and integrate 3. A II, B I, C III, D IV
them 4. A IV, B I, C III, D II
ANS:4 ANS:3
Q69. Absolute income hypothesis explain Q72. A leftward shift in a labour demand curve
1. Consumer behavior is caused by
2. Producer behavior 1. Increase in wage rate
3. Inflation 2. Decrease in wage rate
4. Government expenditure

3. Increase in marginal productivity of
labour
4. Decrease in marginal productivity of
labour
ANS: 4
Q73. The government multiplier is given by

(where c=MPC and t= tax rate)
1
1.
1−(𝑐−𝑡)
1
2. (𝑐−𝑡)𝑡 List – II
1
3.
1−𝑐−𝑡
1
4. 1−𝑐(1−𝑡)
ANS: 4
Q74. According to traditional neoclassical

growth theory, output growth results from
A. Increase in labour quantity and quality

B. Increase in capital
C. Increase in exports
D. Improvement in technology
Choose the correct answer Options
1. A B and C 1. A III, B IV, C II, D I

2. A and B 2. A III, B II, C IV, D I
3. B and C 3. A III, B IV, C I, D II
4. A B and D 4. A I, B III, C II, D IV
ANS:4 ANS:1
Q75. Match List –I with List – II Q76. Match List – I with List – II
List – I List – II
A. Critical minimum effort theory

B. Neo classical growth theory
C. Demographic transition theory
D. Age of high mass consumption
List – II

I. C P Blacker then what will be standard deviation of the new
II. W WRostow series?
III. R Solow
IV. H Leibenstein 1. 𝜎+𝑘
2. 𝜎−𝑘
Options 3. 𝜎
4. 𝜎𝑘
1. A II, B I, C III, D IV
2. A III, B IV, C II, D I ANS:3
3. A I, B II, C IV, D III
Q80. Assertion (A): Chronic poverty is the main
4. A IV, B III, C I, D II
problem facing India
ANS:4
Reason (R): British colonial rule has caused
Q77. Which of the following equations unemployment in India
represent national income identity?
A. Y=C+I+X explanation of A
B. Y=C+I+G+S 2. Both A are R are correct, R is not the
C. Y = C + I + G + (X-M) correct explanation of A
D. Y=C+I+G+M 3. A is correct but R is not correct
ANS:2
1. A only
2. C only Q81. Match List – I with List – II
3. B C and D only
List – I
4. A B and D only
A. Permanent income hypothesis
ANS: 2
B. Relative income hypothesis
Q78. Which of the following committee’s has C. Absolute income hypothesis
been constituted for doubling farmer’s income D. Life cycle hypothesis
by 2022?
List – II
1. Ashok Mehta committee
I. F Modigliani
2. Naresh Chandra committee
II. J M Keynes
3. Rajeev Kumar committee
III. M Friedman
4. Ashok Dalwai committee
IV. J Dusenberry
ANS: 4
Options
Q79. Given ‘𝜎 ′ as the standard deviation of a
1. A II, B III, C IV, D I
given series and if to each and every
2. A I, B IV, C III, D II
observation of the series is added a constant ‘k’,
3. A III, B II, C I, D IV

4. A III, B IV, C II, D I B. OLS estimators do not have the
minimum variance property
ANS:4 C. Tests of significance based on OLS
Q82. Which one of the following is a valid estimates will be inaccurate
objective function as a linear programming D. OLS estimators are inconsistent
problem?
Choose the correct options
1. Max Z = 5x2y
1. A and B are true
2. Max Z = 3x + 2y + 8xy 2. A and C are true
3. Max Z = 2x2 + 3y2 3. B and C are true
4. Max Z = 5x + 2y
4. A and D are true
ANS:4
ANS:3
Q83. Population density refers to
Q86. Transportation cost of trade effects
1. Number of male persons per square A. Pattern of trade
kilometers
B. Boundaries between tradable and non –
2. Number of persons per cubic kilometers tradable goods
3. Number of persons per square C. Global supply chain
kilometers
D. Boundaries of non-tradable goods
4. Number of persons per 10 kilometers
Choose the correct option
ANS:3
1. A and B only
Q84. Statement I: Growth in infrastructure is 2. A B and C only
considered as an essential pre-requisite for 3. ABCD
stepping up GDP growth
4. D only
Statement II: It is vitally important to increase
ANS:2
capital formation in India
Q87. IS and LM curve analysis explain
1. Both are not correct
2. I is correct, II is incorrect A. Product market equilibrium
3. Both are correct B. Money market equilibrium
4. I is incorrect, II is correct C. Capital market equilibrium
D. Foreign trade equilibrium
ANS: 3
Q85. If the disturbance term is heteroscedastic,
which one of the responses based on given 1. A and C only
statement is true? 2. A and D only
3. A and B only
A. OLS estimators are biased
4. C and D only

ANS:3 ANS:2
Q88. Which of the following are Hawkins – COMPREHENSION (QS 91-95)

Simon conditions?
A. Determinant A should be positive

B. Determinant (I-A) should be positive
C. Determinant (I-A) should be negative
D. Principal diagonal elements of Matrix (I-
A) should be positive
1. A and C only
2. A and D only
3. B and D only
4. C and D only
ANS:3
Q91. Offset of emissions are used
Q89. Which of the following are forms of
government borrowing? A. To reduce emissions
B. To provide green image
A. Drawing from treasury C. For emission addition
B. Printing of currency notes
D. To satisfy consumer preferences
C. Borrowings from non bank public
institutions Choose the correct options:
D. Borrowings from banking system
1. ABC
Choose the correct answer 2. ACB
3. ABD
1. A B and C 4. BCD
2. A B and D
3. ABCD ANS:3
4. A and D
Q92. Green electricity means
ANS:3
1. Electricity produced from renewable
Q90. White revolution refers to boost in the sources of energy
production of 2. Electricity from thermal plants
3. Electricity from gas powered plants
1. Rice 4. Hydro power
2. Milk
3. Egg ANS:1
4. Honey
Q93. Impure public goods are

1. Private goods Q96. The externalities of government
2. Public goods intervention in the economy can be found in
3. A package of public and private goods terms of
4. Harmful goods for the society
A. Market development
ANS:3 B. Money supply
C. Storage and price support in agriculture
Q94. The way in which consumers can produce D. Irrigation
a green product from a brown product
1. Monopoly
2. Retail offsets 1. ACD
3. Price discrimination 2. ABD
4. Fiscal deficit 3. ABC
4. AD
ANS:2
ANS:1
Q95. An example of green good is
Q97. The statement “dispute arises when the
A. White paper state expands to areas beyond the realm of
B. Wind power boundaries of the protective or tax-transfer
C. Forest products
state” was given by
D. Solar energy
1. Musgrave
Choose the correct answer 2. Keynes
1. A and B 3. Dalton
2. B and C 4. Buchanan
3. C and D
ANS:4
4. B and D
Q98. Which one of the following objectives of
ANS: 4 public finance is not correct?
COMPREHENSION (QS 96-100) 1. Ensure macroeconomic stability
2. Ensure reduction of adverse balance of
payments
3. Accelerate growth and development
4. Desired state of distribution
ANS: 2
Q99. Which one of the following statements is

true?
A. An expansion of the public sector has

been a necessary and constructive

development and a strong public sector
is needed along with the capitalist
market
B. There are several reasons for the state
to embrace a much larger role
C. In India, state intervention through
public finance policy has to play an
important role
D. Keynesian economics states that the
state has to ensure full employment
1. A and B
2. A B and C
3. AC
4. ABCD
ANS:3
Q100. Which one of the following does NOT fall

in the category of government transfers?
1. National housing
2. Swachchh Bharat Abhiyan
3. Periodic Loan Weivers
4. Education
ANS:4


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NTA UGC NET ECONOMICS – ANSWER KEY 2020 SEPTEMBER

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