The LM curve shows combinations of income and interest rate where: MCQ with Answer and Explanation

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The LM curve shows combinations of income and interest rate where:

A. labour market is in equilibrium

B. goods market is in equilibrium

C. balance of payments is in equilibrium

D. money market is in equilibrium

Answer: Option D

Solution (By JKSSB Mock Tests)

The LM curve represents equilibrium in the money market.

This question belongs to: Economy GK Economy Set 1

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Question #1

The 'Goods and Services Tax' on health insurance for senior citizens is:

A. 12%

B. 5%

C. 0%

D. 18%

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Correct Answer: Option D

Explanation:
Health insurance for senior citizens attracts 18% GST.

This question belongs to: Economy GK Economy Set 1

Question #2

The 'Index of Industrial Production' covers which sectors?

A. Only manufacturing

B. Agriculture and forestry

C. Services

D. Mining, manufacturing and electricity

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Correct Answer: Option D

Explanation:
IIP covers mining, manufacturing and electricity.

This question belongs to: Economy GK Economy Set 1

Question #3

The concept of 'Capital Account Liberalisation' involves:

A. Only the liberalisation of the current account

B. The imposition of new capital controls

C. Only the liberalisation of trade in goods

D. The removal or relaxation of restrictions on cross-border capital flows

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Correct Answer: Option D

Explanation:
Capital-account liberalisation refers to the reduction or elimination of legal barriers to the free movement of capital across national borders.

This question belongs to: Economy GK Economy Set 1

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