The Phillips Curve shows the relationship between: MCQ with Answer and Explanation

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The Phillips Curve shows the relationship between:

A. Interest rate and investment

B. Money supply and price level

C. Inflation and economic growth

D. Unemployment and inflation

Answer: Option D

Solution (By JKSSB Mock Tests)

The Phillips Curve illustrates an inverse relationship between the rate of unemployment and the rate of inflation in an economy in the short run.

This question belongs to: Economy GK Economy Set 1

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Question #1

The primary goal of the Twelfth Five Year Plan was:

A. universal literacy

B. poverty eradication

C. faster, more inclusive and sustainable growth

D. full employment

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Correct Answer: Option C

Explanation:
The Twelfth Five Year Plan aimed at faster, more inclusive and sustainable growth.

This question belongs to: Economy GK Economy Set 1

Question #2

Which of the following is an example of an automatic stabiliser in the economy?

A. Change in repo rate

B. Open market operations

C. Progressive income tax

D. Discretionary government spending

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Correct Answer: Option C

Explanation:
Automatic stabilisers are features of the fiscal system that automatically dampen economic fluctuations without new legislation. Progressive income tax reduces disposable income during booms and increases it during recessions.

This question belongs to: Economy GK Economy Set 1

Question #3

Which of the following was NOT part of the 1991 economic reforms?

A. Abolition of industrial licensing for most industries

B. Opening up to foreign investment

C. Reduction of import tariffs

D. Nationalization of commercial banks

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Correct Answer: Option D

Explanation:
Nationalization of commercial banks was done earlier in 1969 and 1980, not in the 1991 reforms.

This question belongs to: Economy GK Economy Set 1

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