National Income in India – MCQs with Answers for Government Exam Preparation

  1. What is another term for Net National Product (NNP) at market price? a) National Income
    b) Gross Domestic Product (GDP)
    c) Personal Income
    d) Per Capita Income
    Answer: a) National Income
  2. Net National Product (NNP) of a country is: a) GDP minus depreciation allowances
    b) GDP plus net income from abroad
    c) GNP minus net income from abroad
    d) GNP minus depreciation allowances
    Answer: d) GNP minus depreciation allowances
  3. Which of the following is considered part of the service sector? a) Textile Mills
    b) Banking
    c) Coal Mines
    d) Agriculture
    Answer: b) Banking
  4. Which sector contributes the most to India’s Gross National Product (GNP)? a) Primary Sector
    b) Secondary Sector
    c) Tertiary Sector
    d) Public Sector
    Answer: c) Tertiary Sector
  5. Per capita income of a country is derived from: a) National Income
    b) Population
    c) Both National Income and Population
    d) None of these
    Answer: c) Both National Income and Population
  6. The term “Hindu Rate of Growth” in India is associated with: a) Birth Rate
    b) Population
    c) Per Capita Income
    d) National Income
    Answer: d) National Income
  7. In India, the tertiary sector includes: a) Banking
    b) Construction
    c) Trade
    d) All of the above
    Answer: d) All of the above
  8. Which of the following is NOT a method for measuring National Income? a) Value Added Method
    b) Income Method
    c) Investment Method
    d) Expenditure Method
    Answer: c) Investment Method
  9. The most appropriate reason for income inequalities is: a) Racial factors
    b) Lack of opportunities
    c) Family inheritance
    d) Differences in ability
    Answer: b) Lack of opportunities
  10. National Income includes: a) Financial aid to earthquake victims
    b) Child’s pocket money
    c) Lottery winnings
    d) Construction of new houses
    Answer: d) Construction of new houses
  11. National Income of a country refers to: a) Government’s annual revenue
    b) Total productive income
    c) Public sector enterprise surplus
    d) Export and Import balance
    Answer: b) Total productive income
  12. The aggregate net value of output in one year is known as: a) National Income at Factor Cost
    b) GDP at Market Price
    c) Net National Product (NNP) at Market Price
    d) Gross National Product (GNP) at Market Price
    Answer: c) Net National Product (NNP) at Market Price
  13. In a highly developed country, the contribution of agriculture to GDP is: a) High
    b) Moderate
    c) Low
    d) None of these
    Answer: c) Low
  14. Who first estimated National Income in India? a) V.K.R.V. Rao
    b) Dadabhai Naoroji
    c) R.C. Dutt
    d) D.R. Gadgil
    Answer: b) Dadabhai Naoroji
  15. Which of the following is NOT included in National Income estimation through the income method? a) Rent
    b) Mixed Incomes
    c) Pension
    d) Undistributed Profits
    Answer: c) Pension
  16. Which method is NOT used for determining National Income? a) Income Method
    b) Product Method
    c) Expenditure Method
    d) Investment Method
    Answer: d) Investment Method
  17. Which component is NOT a part of National Income? a) Wages and Salaries
    b) Profits
    c) Rent
    d) Interest on National Debt
    Answer: d) Interest on National Debt
  18. What does Gross Domestic Product (GDP) measure? a) Goods produced in an economy in a year
    b) Goods and services produced in an economy in a year
    c) Final goods produced in an economy in a year
    d) Final goods and services produced in an economy in a year
    Answer: d) Final goods and services produced in an economy in a year
  19. Which sector’s contribution is the highest in India’s National Income? a) Agriculture
    b) Industry
    c) Services
    d) Manufacturing
    Answer: c) Services
  20. Which of the following is a transfer payment and not included in National Income? a) Salaries
    b) Pensions
    c) Profits
    d) Rents
    Answer: b) Pensions
  21. What is considered a leakage in the circular flow of income? a) Investment
    b) Taxes
    c) Savings
    d) Government Expenditure
    Answer: c) Savings
  22. Which organization is responsible for National Income estimation in India? a) Reserve Bank of India
    b) Central Statistical Organization (CSO)
    c) NITI Aayog
    d) Ministry of Finance
    Answer: b) Central Statistical Organization (CSO)
  23. Which indicator is best for comparing the standard of living of different countries? a) GDP
    b) GNP
    c) Per Capita Income
    d) National Income
    Answer: c) Per Capita Income
  24. What does ‘Real National Income’ mean? a) National Income at Current Prices
    b) National Income at Constant Prices
    c) Nominal National Income
    d) Gross National Income
    Answer: b) National Income at Constant Prices

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