Which of the following is a characteristic of the informal sector in developing economies? MCQ with Answer and Explanation

Which of the following is a characteristic of the informal sector in developing economies?
A. High capital intensity and formal contracts
B. Easy entry, small scale and labour intensity
C. Complete absence of employment
D. High degree of regulation
Answer: Option B
Solution (By JKSSB Mock Tests)
The informal sector is characterised by easy entry, small-scale operations, labour-intensive technology, lack of formal contracts and limited regulation.

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Practice More Economy Set 1 Questions

Question #1
The 'standing deposit facility' was introduced by RBI as a tool for:
A. absorbing liquidity without collateral
B. long-term investment
C. lending to banks
D. export finance

Correct Answer: Option A


Explanation:
Standing Deposit Facility allows RBI to absorb liquidity from banks without providing collateral.

This question belongs to: Economy GK Economy Set 1
Question #2
The 'Goods and Services Tax' on Pradhan Mantri Suraksha Bima Yojana premium is:
A. 18%
B. 5%
C. 0%
D. exempt

Correct Answer: Option D


Explanation:
PMSBY premium is exempt from GST.

This question belongs to: Economy GK Economy Set 1
Question #3
The 'supply-side economics' emphasizes which policies?
A. reducing tax rates and regulation to increase output
B. increasing aggregate demand
C. increasing money supply
D. raising taxes

Correct Answer: Option A


Explanation:
Supply-side economics emphasizes lower taxes and reduced regulation to stimulate production.

This question belongs to: Economy GK Economy Set 1