The concept of 'Marginal Efficiency of Capital' was introduced by: MCQ with Answer and Explanation

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The concept of 'Marginal Efficiency of Capital' was introduced by:

A. Adam Smith

B. John Maynard Keynes

C. David Ricardo

D. Classical economists

Answer: Option B

Solution (By JKSSB Mock Tests)

Keynes introduced the concept of Marginal Efficiency of Capital (MEC), which is the expected rate of return on an additional unit of capital asset.

This question belongs to: Economy GK Economy Set 1

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Question #1

In the context of monetary policy, the 'Corridor' system refers to:

A. The range of fiscal deficit targets

B. The range of CRR variations

C. The range between repo and reverse repo rates

D. The range of exchange rate fluctuations

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Correct Answer: Option C

Explanation:
The policy rate corridor is defined by the repo rate (ceiling) and reverse repo rate (floor), within which the overnight inter-bank rate fluctuates.

This question belongs to: Economy GK Economy Set 1

Question #2

A 'public good' is characterized by:

A. excludability and rivalry

B. excludability and non-rivalry

C. non-excludability and non-rivalry

D. non-excludability and rivalry

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Correct Answer: Option C

Explanation:
Public goods are non-excludable and non-rivalrous.

This question belongs to: Economy GK Economy Set 1

Question #3

The concept of 'Consumer Surplus' was introduced by:

A. David Ricardo

B. J.S. Mill

C. Alfred Marshall

D. Adam Smith

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Correct Answer: Option C

Explanation:
Alfred Marshall developed the concept of consumer surplus, which is the difference between what a consumer is willing to pay and what he actually pays.

This question belongs to: Economy GK Economy Set 1

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