Which of the following is a characteristic of a dual economy? MCQ with Answer and Explanation

Question
Which of the following is a characteristic of a dual economy?
A. Only service sector dominance
B. Coexistence of a modern industrial sector and a traditional agricultural sector
C. Uniform productivity across sectors
D. Absence of informal activities
Answer: Option B
Solution (By JKSSB Mock Tests)
Dualism refers to the simultaneous existence of a modern, high-productivity sector and a traditional, low-productivity sector within the same economy.
This question belongs to: Economy GK Economy Set 1
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Question #1
Which of the following is a characteristic of a traditional economy?
A. Extensive use of money and banking
B. High use of advanced technology
C. Customs and traditions determine economic decisions
D. Rapid industrialisation
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Correct Answer: Option C

Explanation:
In a traditional economy, economic decisions regarding production and distribution are based on customs, traditions and hereditary practices.
This question belongs to: Economy GK Economy Set 1
Question #2
The concept of 'Liquidity Trap' implies that monetary policy becomes ineffective because:
A. Money demand is interest-inelastic
B. People prefer to hold cash at very low interest rates
C. Investment is highly interest-elastic
D. Interest rates are very high
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Correct Answer: Option B

Explanation:
In a liquidity trap, interest rates are near zero and the demand for money becomes perfectly elastic; additional money supply is absorbed as idle balances without reducing interest rates further.
This question belongs to: Economy GK Economy Set 1
Question #3
The 'Disposable Personal Income' is personal income minus:
A. indirect taxes
B. corporate tax
C. customs duty
D. direct personal taxes and other deductions
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Correct Answer: Option D

Explanation:
Disposable personal income is personal income after direct personal taxes and other deductions.
This question belongs to: Economy GK Economy Set 1
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