A 'customs union' differs from a free trade area by having: MCQ with Answer and Explanation

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A 'customs union' differs from a free trade area by having:

A. separate external tariffs

B. a common currency

C. free movement of labour

D. a common external tariff

Answer: Option D

Solution (By JKSSB Mock Tests)

A customs union has a common external tariff along with internal free trade.

This question belongs to: Economy GK Economy Set 1

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Practice More Economy Set 1 Questions

Question #1

The 'Union Budget' is presented under which article of the Constitution?

A. Article 280

B. Article 112

C. Article 110

D. Article 265

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Correct Answer: Option B

Explanation:
The Annual Financial Statement is presented under Article 112.

This question belongs to: Economy GK Economy Set 1

Question #2

Which of the following is a characteristic of a Giffen good?

A. It is a luxury good

B. Demand decreases as price increases

C. Income elasticity is positive

D. Demand increases as price increases due to strong negative income effect

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Correct Answer: Option D

Explanation:
A Giffen good is an inferior good for which the negative income effect outweighs the substitution effect, resulting in an upward-sloping demand curve.

This question belongs to: Economy GK Economy Set 1

Question #3

Real Time Gross Settlement is a payment system that:

A. settles only retail transactions

B. settles high-value transactions individually in real time

C. settles transactions in batches

D. does not require a bank account

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Correct Answer: Option B

Explanation:
RTGS settles high-value transactions individually and in real time.

This question belongs to: Economy GK Economy Set 1

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