Which of the following is an assumption of the Ricardian theory of comparative advantage? MCQ with Answer and Explanation

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Which of the following is an assumption of the Ricardian theory of comparative advantage?

A. Labour is the only factor of production and is immobile internationally

B. Capital is the only factor of production

C. There are increasing returns to scale

D. Labour is the only factor of production and is mobile internationally

Answer: Option A

Solution (By JKSSB Mock Tests)

Ricardo assumed a single factor (labour), constant returns, and international immobility of labour, while labour is mobile within a country.

This question belongs to: Economy GK Economy Set 1

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Question #1

In the context of growth theory, 'Semi-Endogenous Growth' models feature:

A. Long-run growth that depends on population growth but not on policy parameters that affect the R&D share

B. Only exogenous technological progress

C. No role for research and development

D. Long-run growth that is fully endogenous to policy

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Correct Answer: Option A

Explanation:
Semi-endogenous growth models retain diminishing returns to knowledge in the R&D sector, so that long-run growth is proportional to population growth and is not affected by the share of resources devoted to R&D.

This question belongs to: Economy GK Economy Set 1

Question #2

The 'Special Economic Zones Act' was enacted in India in which year?

A. 2000

B. 2010

C. 2005

D. 2006

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Correct Answer: Option C

Explanation:
The SEZ Act was enacted in 2005.

This question belongs to: Economy GK Economy Set 1

Question #3

M0 in India is also known as:

A. broad money

B. narrow money

C. high-powered money plus time deposits

D. reserve money

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Correct Answer: Option D

Explanation:
M0 is reserve money or high-powered money, comprising currency in circulation plus bankers' deposits with RBI and other deposits.

This question belongs to: Economy GK Economy Set 1

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