Deflation is best defined as: MCQ with Answer and Explanation

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Deflation is best defined as:

A. a sustained fall in the general price level

B. a decrease in the rate of inflation

C. a rise in unemployment

D. a fall in GDP

Answer: Option A

Solution (By JKSSB Mock Tests)

Deflation is a sustained fall in the general price level.

This question belongs to: Economy GK Economy Set 1

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Question #1

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Which of the following is a major advantage of a flexible exchange rate system?

A. Automatic adjustment of balance of payments

B. No need for foreign exchange reserves

C. Elimination of all speculation

D. Complete insulation from external shocks

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Correct Answer: Option A

Explanation:
Under a flexible exchange rate system, the exchange rate adjusts automatically to equilibrate the demand and supply of foreign exchange, helping to correct balance of payments imbalances.

This question belongs to: Economy GK Economy Set 1

Question #2

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The 'General Agreement on Tariffs and Trade' was replaced by the WTO in which year?

A. 1995

B. 1998

C. 1993

D. 2001

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Correct Answer: Option A

Explanation:
The WTO replaced GATT in 1995.

This question belongs to: Economy GK Economy Set 1

Question #3

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The 'Goods and Services Tax' on renting of residential property for commercial use is:

A. 12%

B. 18%

C. 5%

D. 0%

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Correct Answer: Option B

Explanation:
Renting residential property for commercial use attracts 18% GST.

This question belongs to: Economy GK Economy Set 1

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