Practicing Success

Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: National Income Accounting

Question:

Match the following:

Column I Column II
i.Intermediate good a. Foreseen obsolescence
ii. Purely Financial b. Investment
iii. Addition to Capital Stock c. derived demand
iv. Depreciation d. Sale of shares
Options:

i-c, ii-d, iii-a, iv-b

i-c, ii-b, iii-a, iv-d

i-c, ii-d, iii-b, iv-a

i-c, ii-b, iii-d, iv-a

Correct Answer:

i-c, ii-d, iii-b, iv-a

Explanation:

The correct answer is option 3: i-c, ii-d, iii-b, iv-a

i. Intermediate good - c. derived demand

  • Intermediate goods are products used in the production of final goods and services. Their demand is derived from the demand for the final goods they help to produce.

ii. Purely Financial - d. Sale of shares

  • Purely financial transactions, such as the sale of shares, involve the transfer of ownership of financial assets and do not directly contribute to the production of goods and services.

iii. Addition to Capital Stock - b. Investment

  • Investment refers to the addition to capital stock, such as purchasing new machinery or building new infrastructure.

iv. Depreciation - a. Foreseen obsolescence

  • Depreciation is the accounting process of allocating the cost of a tangible asset over its useful life, accounting for wear and tear or obsolescence.