If a 10% increase in the price of a good causes quantity demanded to fall by 5%, the price elasticity of demand is: MCQ with Answer and Explanation

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If a 10% increase in the price of a good causes quantity demanded to fall by 5%, the price elasticity of demand is:

A. 5

B. 2

C. 1

D. 0.5

Answer: Option D

Solution (By JKSSB Mock Tests)

Elasticity = 5% / 10% = 0.5, which is inelastic.

This question belongs to: Economy GK Economy Set 1

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Question #1

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The 'Goods and Services Tax' rate on gold in India is:

A. 12%

B. 5%

C. 3%

D. 0%

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Correct Answer: Option C

Explanation:
Gold and jewellery attract 3% GST.

This question belongs to: Economy GK Economy Set 1

Question #2

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Which of the following is NOT a component of the capital market?

A. Mutual funds

B. Call money market

C. Insurance companies

D. Stock exchanges

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Correct Answer: Option B

Explanation:
Call money market is a part of the money market (short-term). Capital market deals with long-term funds and includes stock exchanges, mutual funds and insurance companies.

This question belongs to: Economy GK Economy Set 1

Question #3

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Revenue deficit is calculated as:

A. revenue receipts minus revenue expenditure

B. fiscal deficit minus primary deficit

C. revenue expenditure minus revenue receipts

D. total expenditure minus total receipts

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Correct Answer: Option C

Explanation:
Revenue deficit is revenue expenditure minus revenue receipts.

This question belongs to: Economy GK Economy Set 1

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