economics Mcqs
1. the national economy2. profit maximizing under perfect competition and monopoly3. application of economics4. the aggregate demand aggregate supply model5. surplus6. money interest rates and output7. average and total cost8. stabilization adjustment reform and privatization9. risks and diversification efficient market hypothesis10. the phillips curve11. supply and demand12. capital formation investment choice information technology and technical progress13. aggregate supply unemployment and inflation14. elasticity15. comparative gdp16. roots of modern macroeconomics17. production factors18. poverty malnutrition and income inequality19. trade regulations and industrial policies20. monetary union21. exchange rate systems and currency crises22. economic development in historical perspective23. exchange rate determination24. monopoly competition25. the balance of payments26. inflation productivity27. macroeconomic issues and analysis28. employment migration and urbanization29. macroeconomic policy tools30. supply side policies31. exchange rate adjustments and the balance of32. miscellaneous33. taxation34. trade policies for the developing nations35. markets efficiency and the public interest36. the external debt and financial crises37. budget deficits and the trade balance38. alternative theories of the firm39. public goods40. the meaning and measurement of economic development41. characteristics and institutions of developing countries42. agriculture irrigation system of pakistan43. education health and human capital44. economic problems of developing countries45. theories of economic development46. basic of economics47. consumer theory vs real consumers48. applied microeconomics49. long term economic growth50. externality internality51. fiscal and monetary policy52. prices wages taxes53. balance of payments aid and foreign investment54. international factor movements and multinational corporations55. entrepreneurship organization and innovation56. the international economy and globalization57. population and development58. non tariff trade barriers59. foundations of modern trade theory60. global economic development61. market62. rural poverty and agricultural transformation63. regional trading arrangements64. foreign exchange65. introduction to economics66. world economy miscellaneous67. sources of comparative advantage68. natural resources and the environment toward sustainable development69. monopoly70. asymmetric information71. income inequality72. labour market73. tariffs74. development planning and policy making the state and the market75. oligopoly76. industrial development77. costs supply and perfect competition78. human capital79. monetary fiscal and incomes policy and inflation80. stocks
4951. If the price elasticity of demand is unit then a fall in price ?
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A. Leaves revenue unchanged

B. Increase revenue

C. Reduces costs

D. Reduces revenue

4952. Supply is likely to be more price elastic ?
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A. If it is easy to expand output

B. If factors of production are relatively immobile between industries

C. In the short run rather than the long run

D. If there are very few producers

4953. An increase in price from 25 pence to 30 pence leads to an increase in the quantity supplied from 40 units to 44 units. The price elasticity of supply is ?
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A. +0.5

B. 2

C. -2

D. -0.5

4954. The price of burgers increase by 22% and the quantity of burgers demanded falls by 25% This indicates that demand for burgers is ____________?
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A. perfectly elastic

B. inelastic.

C. elastic

D. unitarily elastic

4955. For an inferior good ?
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A. The price elasticity of demand is negative: the income elasticity of demand is negative

B. The price elasticity of demand is negative the income elasticity of demand is positive

C. The price elasticity of demand is positive the income elasticity of demand is negative

D. The price elasticity of demand is positive the income elasticity of demand is positive

4956. The law of demand implies that ?
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A. as prices rise, quantity demanded increases

B. as prices fall, quantity demanded increase

C. as prices rise, demand decrease

D. as prices fall demand increases

4957. If marginal utility is zero ?
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A. Total utility is maximized

B. An additional unit of consumption will increase total utility

C. Total utility is zero

D. An additional unit of consumption will decrease total utility

4958. Which of the following will NOT cause a shift in the demand curve for compact discs ?
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A. A change in wealth

B. A change in income.

C. A change in the price of compact discs

D. hange in the price of pre-recorded cassette tapes

4959. You can see the computer age everywhere but, in the productivity, statistics is a attributed to which economist ?
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A. Theodore W. Schultz

B. Dale Jorgenson

C. Robert Solow

D. Joseph Stieglitz

4960. Market price adjusted to consider differences between social cost-benefit and private cost-benefit calculations are ?
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A. shadow prices

B. price distortions

C. consumer surplus

D. exchange rates

4961. An example of external diseconomies is ?
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A. a new drug to cure AIDS

B. R&D in robotics

C. environmental pollution

D. scholarship for technical education

4962. In the 1980s economists studying the source of growth observed no positive relationship between information and communications technology (ICT) investments and productivity This is known as ?
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A. Stieglitz discrepancies

B. technological followership

C. Solow residual

D. productivity paradox
4963. Which of the following is True is LDCs ?
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A. Adapting existing Western technology to LDC conditions requires little creativity

B. It is cheaper to hire labor in LDC because its productivity is relatively higher than in DCs

C. Labor is usually considered the scarce factor

D. Labor is often underemployed, having a low alternative cost
4964. he efficiency wage is the ?
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A. wage rate that prevails in LDCs

B. Wage rate divided by the productivity of labor

C. wage costs per unit of output

D. marginal product of labor divided by wage

4965. Vaccinating people for measles, rubella, polio and cholera to substantially increase net social benefits by improving the health and productivity of the population is an example of ?
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A. economies of scale

B. external economies

C. net present value

D. negative externality

4966. Suppose a project results in a net stream of $200 per year for 4 years, but nothing thereafter, Assume that the discount rate is 5 percent. The discounted value of the total income stream over the 4-year period is ?
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A. 800

B. less than zero

C. 40,000

D. more than zero but less than 800
4967. James Pickett D. J. C. Forsyth, and N. S McBain on the basis of field research in Africa, concluded that business people often want to use the most advanced design without knowing that it may not be the most profitable. They attribute this attitude to ?
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A. engineering mentality

B. factor price distortions

C. maximum capital absorption

D. intermediate technology

4968. Canada France, Germany, Italy, Japan, The United Kingdom and United States are ?
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A. G-7 countries

B. countries with decreasing TFP growth since 1990s

C. countries with the lowest information technology equipment and software index prices

D. countries with highest productivity growth in the world since 1960

4969. Which of the following is not a nature public monopoly ?
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A. mobile phone

B. electricity

C. water supply

D. postal service

4970. Lack of absorptive capacity in developing countries results from ?
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A. too few innovative entrepreneurs

B. small size of infrastructure

C. unsuitable technology

D. All of the above are correct

E. inadequate government bureaucracy

4971. Which of the following is not True ?
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A. In 2001 the World information technology expenditures were about 1/20 of 1% of world gross investment

B. In 2001 internet users per 1000 people in middle income countries were greater than high income countries

C. Mobile phones do not require the massive infrastructure investment that mainline telephone require

D. In 1990 the world had 98 mainline phones and 2 mobile phones per 1,000 people: in 2001 169 mainline and 153 mobiles per 1000

4972. In the long run, expanding educational and training facilities, transportation and communication and other infrastructure in LDCs should increase ?
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A. productivity paradox

B. uncertainly

C. absorptive capacity

D. the residual

4973. A case when internal economies of scale bring about a continuously falling average cost curve that makes having more than one firm in an industry inefficient is illustrative of ?
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A. The existence of oligopoly

B. a natural monopoly

C. an individual firm facing a horizontal (perfectly elastic) demand curve in LDCs

D. an LDCs limit of one firm to an industry

4974. The classical view of the labor market is basically consistent with the assumption of _________ aggregate supply curve?
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A. an upward sloping

B. a vertical (or almost vertical)

C. a downward sloping

D. a horizontal (or almost horizontal)

4975. The Phillips curve indicates that there is a ?
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A. positive relationship between labor supply and the inflation rate

B. negative relationship between the inflation rate and labor demand

C. negative relationship between the inflation rate and the unemployment rate

D. positive relationship between the inflation rate and the employment the

4976. The classical model of macroeconomics assumes ?
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A. A and C

B. the economy may operate below full capacity

C. wages and prices are flexible

D. B and D

E. the economy is always at full capacity

F. wages and prices are sticky

4977. In the events of an increase in the international price of oil that encouraged the central bank to accept lower real interest rates, inflation would most likely ?
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A. remain the same

B. fluctuates

C. increase

D. fall

4978. The Keynesian model is a good guide to ____ behavior and the classical model describes behavior in ______?
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A. flexible imperfect markets

B. long run, imperfect markets

C. long run, short run

D. short-term long run
4979. The natural rate of unemployment is generally thought to be the sum of ?
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A. frictional unemployment and cyclical unemployment

B. cyclical unemployment and structural unemployment

C. frictional unemployment and structural unemployment

D. frictional unemployment and seasonal unemployment

4980. Doubts about the natural and the existences of the Phillips curve arose in the 1970s when the economy experienced ?
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A. simultaneously low rates of inflation and unemployment

B. a high rate of unemployment along with a low rate of inflation

C. simultaneously high rates of inflation and unemployment

D. a high rate of inflation: along with a low rate of unemployment

4981. Governments may contribute to inflationary pressure because of building up large ?
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A. expenditures

B. numbers of employees

C. welfare plans

D. budget deficits
4982. An advocate of the classical model of the economy would claim that unemployment is created when the ____ is above its equilibrium level in the ______?
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A. interest rate, market for loanable funds

B. wage rate, labor market

C. tax rate, government budget

D. price level, aggregate economy

4983. The AD schedule indicates that _______ inflation is associated with ________ output?
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A. lower, lower

B. zero, zero

C. higher, lower

D. higher, higher

4984. An unspoken agreement between workers and firms that the firm will not cut wages is known as ?
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A. a relative-wage contract

B. an implicit or social contract

C. employment at will

D. an explicit contract

4985. The costs of inflation are ?
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A. menu costs

B. uncertainly

C. income redistribution

D. shoe leather costs

E. all of the above
4986. Those who hold the classical view of the labor market are likely to believe that ?
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A. neither monetary nor fiscal policy will have an effect on output and employment

B. monetary but not fiscal policy will have an effect on output and employment

C. Fiscal, but not monetary policy will have an effect on output and employment

D. both monetary and fiscal policy will have an effect on output and employment

4987. The long-run Phillips curve is ____ at the ____?
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A. vertical natural rate of inflation

B. horizontal natural rate of unemployment

C. vertical equilibrium rate of unemployment

D. horizontal, natural rate of inflation

4988. The Phillips curve is a graph showing the relationship between ?
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A. the inflation rate and the level of aggregate demand

B. the price level and the unemployment rate

C. the inflation rate and the unemployment rate

D. the level of aggregate output and the price level

4989. Policies to reduce unemployment by reducing union power, tax cuts, reductions in unemployment benefit and investment subsidies are examples of ?
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A. Monetarist Policies

B. Classical policies

C. Supply-side policies

D. Keynesian policies

4990. In the long run, the Phillips curve will be vertical at the natural rate of unemployment if ?
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A. the long run aggregate demand curve is vertical at potential GDP

B. the long-run aggregate demand curve is horizontal at the natural rate of inflation

C. the long run aggregate demand curve is vertical at potential GDP

D. The long run supply curve is horizontal at the natural rate of inflation

4991. The abolition of income tax would probably ______ the number of workers in employment and _______ the equilibrium rate of unemployment?
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A. increase reduce

B. increase, increase

C. reduce, increase

D. reduce, reduce

4992. When economists use the term real business cycle theory they are suggesting that business cycles are caused by ?
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A. changes in export demand due to the state of the world economy

B. Shifts in aggregate supply

C. business expectations

D. business confidence

4993. Which school of economic thought suggested that one possible cause of inflation was a push from the cost side ?
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A. New classical economists

B. Monetarists

C. Marxists

D. Keynesian.
4994. We would normally expect the size of the labor force to be _____ than the number or workers willing to accepts job offers at any real wage rate ?
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A. Larger

B. the same size

C. Smaller

D. None of these

4995. If a person thinks they are better off after a 10% wage increase, and all prices have risen 10% then they are experiencing ?
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A. inflation illusion

B. crowding out

C. a supply shock

D. inflation

4996. At the intersection of AD and AS equilibrium is achieved in ?
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A. the goods market

B. the money markets

C. all of these

D. the labor markets

4997. Even though explicit contracts may lead to layoffs during recessions explicit contracts may still be efficient because such contracts ?
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A. will equitable spread the layoffs among junior and senior workers

B. minimize negotiation costs

C. minimize unemployment effects

D. guarantee that only the least productive workers will be laid off.

4998. Possible causes of involuntary unemployment are ?
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A. insider-outsider distinctions

B. trade

C. efficiency wages

D. all of the above

E. minimum wage agreements

F. scale economies

4999. All the following are types of monetary policy expect ?
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A. The pursuit of a target real interest rate

B. a balanced budget

C. a nominal money stock target

D. an inflation target

5000. The equilibrium rate of unemployment at any real wage, is the difference between ______ and ______?
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A. labor demand, labor supply

B. those willing to work at the going wage labor supply

C. those willing to work at the going wage labour demand

D. labour demand those willing to work at the going wage