Class 9 Types of Economies Mock Test (ICSE)

Topics in Types of Economies

• Capitalist, socialist and mixed economies
• Developed and developing economies
• Economic growth and economic development
• Indicators of development

Types of Economies practice questions with answers

1. Q1Multiple choice·1 mark
   In a socialist economy, fundamental economic decisions are primarily made by:

   1. (a)Private entrepreneurs
   2. (b)Market forces of demand and supply
   3. (c)Consumers independently
   4. (d)Central planning authority
   Show answer and step marks

   1. Correct option: (d) Central planning authority+1

   Answer: (d)
2. Q2Multiple choice·1 mark
   Economic growth is generally measured by an increase in which of the following?

   1. (a)Economic welfare and overall happiness
   2. (b)Real Gross Domestic Product ($GDP$)
   3. (c)Level of income inequality
   4. (d)Population growth rate
   Show answer and step marks

   1. Correct option: (b) Real Gross Domestic Product ($GDP$)+1

   Answer: (b)
3. Q3Multiple choice·1 mark
   Which of the following is considered a social indicator of economic development?

   1. (a)Literacy rate
   2. (b)Per capita income
   3. (c)Volume of foreign trade
   4. (d)Industrial output
   Show answer and step marks

   1. Correct option: (a) Literacy rate+1

   Answer: (a)
4. Q4Multiple choice·1 mark
   Which of the following is a characteristic feature of a developing economy?

   1. (a)High rate of capital formation
   2. (b)Dependence on the primary sector
   3. (c)Advanced technological infrastructure
   4. (d)High per capita income
   Show answer and step marks

   1. Correct option: (b) Dependence on the primary sector+1

   Answer: (b)
5. Q5Long answer·4 marks
   Distinguish between economic growth and economic development by stating four distinct points of difference.
   Show answer and step marks

   1. First difference, any one of: meaning, since growth is an increase in real output of goods and services while development is growth plus progressive change in the socio-economic structure; nature, since growth is quantitative while development is qualitative as well as quantitative; measurement, since growth is measured by GDP or per capita income while development is measured by indices such as HDI or PQLI; scope, since growth is a narrow concept while development is a broad one covering health, education and welfare; growth can occur without development, but development is rarely possible without growth; relevance, since growth is the main concern of developed nations while development is the main goal of developing ones; or any other valid difference.+1
   2. Second difference, a different one from the same list.+1
   3. Third difference, a different one from the same list.+1
   4. Fourth difference, a different one from the same list.+1

   Answer: Any four of: growth is a rise in real output while development is growth with structural change; growth is quantitative while development is qualitative and quantitative; growth is measured by GDP or per capita income while development is measured by HDI or PQLI; growth is narrow while development is broad; growth can occur without development but not the reverse; growth concerns developed nations while development is the goal of developing ones.
6. Q6Long answer·4 marks
   (a) State any two differences between economic growth and economic development. (b) Explain two reasons why a country can experience economic growth without achieving economic development.
   Show answer and step marks

   1. (a) First difference, any one of: growth is quantitative (a rise in real national income or GDP) while development is qualitative as well, including structural change and welfare; growth is a narrow concept about output while development is multidimensional, covering literacy, health and living standards; growth is measured by GDP or per capita income while development is measured by HDI or PQLI; or any other valid difference.+1
   2. (a) Second difference, a different one from the same list.+1
   3. (b) First reason, any one of: the increase in income is concentrated in a small wealthy section, leaving poverty and unemployment high; growth comes from capital-intensive industries that create few jobs; rapid population growth eats up the rise in income; too little is spent on health, education and sanitation; growth causes environmental damage that harms people's quality of life; or any other valid reason.+1
   4. (b) Second reason, a different one from the same list.+1

   Answer: (a) Any two of: growth is quantitative while development is also qualitative; growth is narrow while development is multidimensional; growth is measured by GDP while development is measured by HDI or PQLI. (b) Any two of: unequal distribution of the extra income; jobless capital-intensive growth; rapid population growth; low spending on health and education; environmental damage.

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