Which of the following is not a determinant of money demand in Keynesian theory? MCQ with Answer and Explanation

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Which of the following is not a determinant of money demand in Keynesian theory?

A. Precautionary motive

B. Speculative motive

C. Depreciation motive

D. Transactions motive

Answer: Option C

Solution (By JKSSB Mock Tests)

Keynes identified transactions, precautionary and speculative motives for holding money, not depreciation motive.

This question belongs to: Economy GK Economy Set 1

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Question #1

The 'Foreign Trade Policy' in India is usually announced for a period of:

A. 5 years

B. 15 years

C. 10 years

D. 1 year

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Correct Answer: Option A

Explanation:
Foreign Trade Policy is normally announced for a five-year period.

This question belongs to: Economy GK Economy Set 1

Question #2

Purchasing Power Parity theory states that exchange rates between currencies adjust to equalize:

A. the purchasing power of currencies in terms of goods

B. inflation rates only

C. government budget deficits

D. interest rates

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Correct Answer: Option A

Explanation:
Purchasing Power Parity says exchange rates adjust so that identical goods cost the same in different currencies.

This question belongs to: Economy GK Economy Set 1

Question #3

A negative externality occurs when:

A. social benefit exceeds private benefit

B. private benefit equals social benefit

C. social cost exceeds private cost

D. private cost exceeds social cost

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Correct Answer: Option C

Explanation:
A negative externality arises when social cost exceeds private cost, e.g. pollution.

This question belongs to: Economy GK Economy Set 1

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