In the IS-LM model, the IS curve represents equilibrium in the: MCQ with Answer and Explanation

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In the IS-LM model, the IS curve represents equilibrium in the:

A. Labour market

B. Foreign exchange market

C. Money market

D. Goods market

Answer: Option D

Solution (By JKSSB Mock Tests)

The IS curve shows combinations of interest rate and income at which the goods market is in equilibrium (Investment = Saving).

This question belongs to: Economy GK Economy Set 1

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Question #1

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In the Cobb-Douglas production function Q = A L^α K^β, if α + β = 1, the production function exhibits:

A. increasing returns to scale

B. negative returns

C. constant returns to scale

D. decreasing returns to scale

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Correct Answer: Option C

Explanation:
If α + β = 1, the Cobb-Douglas production function exhibits constant returns to scale.

This question belongs to: Economy GK Economy Set 1

Question #2

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The 'Goods and Services Tax' on courier services is:

A. 28%

B. 5%

C. 12%

D. 18%

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Correct Answer: Option D

Explanation:
Courier services attract 18% GST.

This question belongs to: Economy GK Economy Set 1

Question #3

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The 'Organisation for Economic Co-operation and Development' is headquartered in:

A. London

B. Paris

C. New York

D. Geneva

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Correct Answer: Option B

Explanation:
OECD is headquartered in Paris.

This question belongs to: Economy GK Economy Set 1

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