Economy MCQ 2026

Economy Mcq 2026 is the best resource for students preparing for SSC, UPSC , banking and other Competetive exams .In this Economy mcq 2026 guide , you will find questions based on Indian Economy topics like GDP, inflation, banking and budget . Practicing Economy mcq 2026 regularly helps improve your accuracy and speed in exams. This economy mcq 2026 set includes objectives questions with answers and explanations for better understanding.

Question No. 1. A good that is not rivalrous and non- excludable Where one person consumption does not reduce availability for others and no one can be prevented from using it is known as a

A.Private good

B. Public good

C. Common good

D. Club good

Answer :Public goods

Details : Such as, National Defense or the air we breathe, are characterized by being non-rivalries (one person using it does not stop another ) and non-excludable ( you cannot stop someone from benefitting it ) . In contrast, private goods (like a car ,Are both rivalries and excludable .

Question . 2. What does the inverted ‘U’ shape of the Kuznets Curve represent ?

A. As an economy grows , inequality first increases and then decreases .

B. As an economy grows, inflation first decreases and then stays constant .

C. Primary sectors always contribute more to GDP than tertiary sectors

D. Economics grows leads to a permanent and continuous increase in inequality .

Answer : As an economy grows, inequality first increases and then decreases.

Details : The Kuznets Curve illustrates the relationship between economic growth and inequality. It suggests that in the early stages of development, inequality increases as the nation grows, but after reaching a peak, further growth leads to a decrease in inequality .

Question No. 3. If the government provides a commodity (like food grains) for free to the public, what happens to the “opportunity Cost”?

A. The opportunity cost becomes zero because the product is free

B. The Government ignored the opportunity cost

C. The opportunity cost is transferred from the consumers to the tax -paying public

D.The opportunity cost is only borne by the person receiving the free good

Answer: The opportunity cost is transferred from the consumers to the tax-paying public.

Details : There is no such as a ‘free’ good in economic terms .If a government provides something for free , the opportunity cost is transferred to the tax – paying public, as the funds used for that free good come from taxes and could have been used elsewhere .

Question No. 4. Which sector is specifically associated with high – level decision-making processes in government and industries ?

A. tertiary Sector

B.Quaternary Sector

C. Quinary Sector

D. Secondary Sector

Answer : Quinary Sector

Details : While the Quaternary Sector involves knowledge – based activities like Research and Development (R&D) the Quinary Sector is focused on the highest levels of decision- making within a government or industry.

Question. No. 5. If the price of ” coffee” ( a substitute for tea ) increases significantly, what is the likely impact on demand for “Tea”?

A. Demand for Tea will increase because people will stop drinking hot beverages.

B. Demand for the Tea will increase as consumers switch from expensive Coffee

C. Demand for Tea will remand same

D.Tea will become an “inferior good’

Answer: Demand for Tea will increase as consumers switch from expensive Coffee.

Details: If the price of one substitute (Coffee) goes up, Consumers will avoid it and switch to the others. Thereby increasing the demand for Tea .