Important Concepts in Economy: UPSC Previous Year Questions (Indian Economy)
1 previous year UPSC Prelims question on Important Concepts in Economy (Indian Economy). Choose an option to see the answer and explanation.
Explanations state facts as of the year each question was asked; words like “recently” refer to that year.
Showing 1–1 of 1 question
UPSC 2018Indian Economy · Important Concepts in Economy
Q1. If a commodity is provided free to the public by the Government, then
Explanation
Opportunity cost: refers to the value of the next best alternative foregone when a choice is made. Even if a commodity is provided "free" to the public, resources (such as government funds, labor, or infrastructure) are still required for its provision.
Option (c) is correct: If a commodity is provided free to the public by the Government, then the opportunity cost is transferred from the consumers of the product to the tax-paying public. As per microeconomics, the opportunity cost is zero for free goods such as air and common goods such as fish/grazing land. For public goods such as street lights and defence, the opportunity cost is involved (The government could have spent that much money on street lights rather than on the military). So, the opportunity cost is not zero.
Answer key for these questions
Q
UPSC year
Correct answer
1
2018
(c) the opportunity costs are transferred from the consumers of the product to the tax-paying public.
Frequently asked questions
How many previous year UPSC questions are there on Important Concepts in Economy?
This page covers 1 previous year UPSC Prelims GS Paper-I questions on Important Concepts in Economy (Indian Economy), asked from 1996 to 2022. Each has the correct answer and an explanation.
How should I use previous year UPSC questions for Prelims?
Attempt each question first, then open the answer and read the explanation for every option. Repeat by chapter, and track which statements UPSC reuses across years. Previous year questions show the exam pattern and difficulty level.
Which years are covered for Important Concepts in Economy?
Questions on Important Concepts in Economy (Indian Economy) are available for 11 years, from 1996 to 2022. Use the Year filter to practise a single paper.
