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
5051. A reasonable measure of the standard of living in a country is ?
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A. Real GDP

B. nominal GDP per person.

C. The growth rate of nominal GDP per person

D. real GDP per person
5052. Which of the following expenditures to enhance productivity is most likely to emit a positive externality ?
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A. Naila pays her university tuition fees.

B. OGDC leases a new oil field

C. Indus Motors buys a new drill press

D. Megabank buys a new computer

5053. Which of the following is an example of foreign portfolio investment ?
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A. Toyota builds a new plant in the north of England

B. JCB builds a new plant near Manchester

C. EDF of France buys shares in Scottish & Southern Energy of the UK, and Scottish & Southern Energy uses the Proceeds to build a new hydro-electric power station in Scotland

D. Deutsche Bank of Germany buys some new software from UK Supplier

5054. Our standards of living is most closely related to ?
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A. our supply of capital because everything of value is produced by machinery

B. our supply of natural resources because they limit production

C. our productivity because our income is equal to what we produce

D. how hard we work:

5055. If a production function exhibits constant returns to scale ?
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A. doubling all of the inputs doubles output

B. doubling all of the inputs more than doubles output due to the catch-up effect

C. doubling all of the inputs has absolutely no impact on output because output is constant

D. doubling all of the inputs less than doubles output due to diminishing returns

5056. For a given level of technology, we should expect an increase in productivity within a nation when there is an increase in each of the following except ?
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A. labor

B. natural resources/worker

C. human capital/worker

D. physical capital/worker

5057. Copper is an example of ?
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A. a renewable natural resource

B. technology

C. physical capital

D. a non-renewable natural resource
5058. Many East Asian countries are growing very quickly because ?
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A. They have always been wealthy and will continue to be wealthy, which is known as the snowball effect

B. They have enormous natural resources.

C. They are imperialists and have collected wealth from previous victories in war

D. They save and invest an unusually high percentage of their GDP
5059. The persistence of a phenomenon such as unemployment, even then its causes have been removed is called ?
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A. negative entropy.

B. the fallacy of composition

C. hysteresis.

D. ceteris paribus

5060. According to classical models, the level of employment is determined primarily by ?
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A. interest rates

B. the level of aggregate demand for goods and services.

C. prices and wages

D. the quantity of money

5061. A group of modern economists who believe that institutional factors and confidence strongly influence business behaviour and that expanding demand will usually increase output rather than prices are the ?
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A. monetarists.

B. keynesians

C. new classical school

D. post-keynesians
5062. The quantity theory of money implies that a given percentage change in the money supply will cause ?
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A. a larger percentage change in nominal GDP

B. a smaller percentage change in nominal

C. an equal percentage change in nominal DGP.

D. an equal percentage change in real GDP

5063. A group of modern economists who believe that markets clear very rapidly and that expanding the money supply will always increase prices rather than employment are the ?
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A. Keynesians

B. monetarists

C. post-keynesians

D. new classical school
5064. New classical theories were an attempt to explain ?
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A. the stagflation of the 1970s

B. how unemployment could have persisted for so long during the Great Depression

C. The increase in the growth rate of real output in the 1950s

D. Why policy changes that are perceived as permanent have more of an impact on a persons behaviour than policy changes that are viewed as temporary.

5065. If the demand for money depends on the interest rate the velocity of circulation is ?
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A. not constant and the quantity theory of money does not hold.

B. not constant and the quantity theory of money does hold.

C. constant and the quantity theory of money does hold.

D. constant and the quantity theory of money does not hold.

5066. It is difficult to determine if the velocity of money is constant over time because ?
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A. whether velocity is constant or not may depend on how the money supply is measure.

B. it is difficult to measure the value of nominal GDP over time

C. it is difficult to measure the demand for money over time

D. there has been very little fluctuation in the money supply over time.

5067. Keynesian economics became popular because it was able to explain ?
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A. The prolonged existence of high unemployment during the Great depression

B. stagflation in the late 1970s

C. demand-pull inflation in the 1960s

D. low growth rates in the 1950s

5068. According of Keynes, the level of employment is determined by ?
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A. the behaviour of trade unions.

B. the level of aggregate demand for goods and services

C. price and wages

D. the quantity of money

5069. The nation that the government can establish the macroeconomic is known as ?
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A. monestarism

B. the classical model

C. microeconomics foundations of macroeconomics

D. fine tuning
5070. The regarding the new classical macroeconomics is hoe realistic is the assumption ?
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A. that fiscal policy affects aggregate demand

B. of rational expectations.

C. that monetary policy affects aggregates demand

D. that markets do not clear quickly

5071. The hypothesis that people know the true model of the economy and that they use this model to form their expectations of the future is the ?
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A. adaptive expectations hypothesis

B. Passive-expectations hypothesis

C. Rational-expectations hypothesis

D. lagged-expectations hypothesis.

5072. Prices that do not always adjust rapidly to maintain equality between quantity supplied and quantity demanded are ?
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A. sticky prices

B. market prices

C. fixed prices

D. regulatory prices

5073. According to the classical economists the economy ?
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A. requires fine tuning to reach full employment

B. can never deviate from full employment

C. will never be at full employment

D. is self-correcting.
5074. Rapid increase in the price level during periods of recession of high unemployment are known as ?
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A. slump

B. stagnation

C. inflation

D. stagflation
5075. The rational-expectation hypothesis suggests that the forecasts that people make concerning future inflation rates ?
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A. consistently overestimate the actual rate of inflation in the future.

B. are correct on average, but are subject to errors that are distributed randomly

C. are always correct

D. consistently underestimate the actual rate of inflation in the future

5076. The economists who emphasised wage flexibility as a solution for unemployment were ?
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A. post-Keynesian.

B. classical economists.

C. new-Keynesian.

D. Keynesian.

5077. The government increase government spending to try to reduce unemployment This is an example of ?
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A. automatic stablisers

B. fine tuning

C. monetary policy

D. laissez-faire.

5078. People are said to have rational expectations if they ?
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A. merely guess at the inflation rate.

B. assume that this years inflation rate will be the same as last years inflation rate

C. Use all available information in forming their expectations.

D. assume that this years inflation rate will be equal to the average inflation rate over the past 10 years

5079. A competitive profit-maximizing firm should hire workers up to the point where ?
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A. the marginal product of labor equals the wage

B. the wage, the rental price of capital and the rental price of land are all equal

C. the marginal product of labor equals zero and the production function is maximized

D. the value of the marginal product of labor equals the wage
5080. What will a decrease in the supply of fishermen do to the market for capital employed in the fishing industry ?
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A. decreases the demand for fishing boats and increase rental rates on fishing boats.

B. increase the demand for fishing boats and decrease rental rates on fishing boats

C. decreases the value of the marginal product of fishermen, reduces their wage, and increases employment in the fishing industry

D. increase the demand for fishing boats and increase rental rates on fishing boats

5081. If a factor exhibits diminishing marginal product, hiring additional units of the factor will ?
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A. increase the marginal product of the factor

B. cause a reduction is output

C. generate ever smaller amounts of output

D. have no effect on output

5082. An individual firms demand for a factor of production ?
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A. is perfectly elastic (horizontal) if the factor market is perfectly competitive

B. Slopes downward because an increase in the production of output reduces the price at which the output can be sold in a competitive market, thereby reducing the value of the marginal producing the value of the marginal product as more of the factor is use

C. Slopes downward due to the factors diminishing marginal product

D. slopes upward due to the factors increasing marginal product

5083. A decrease in the supply of farm tractors will cause all but which of the following ?
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A. an increase in the rental rate for tractor

B. a decrease in the rental rate of farmland

C. a decrease in the value of the marginal product of tractors

D. an increase in the wage of farm workers
5084. An increase in the demand for apples will cause all but which of the following ?
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A. an increase in the price of apples

B. an increase in the wage of apple pickers

C. an increase in the value of the marginal product of apple pickers

D. a decrease in the number of apple pickers employed
5085. For a competitive profit-maximizing firm, the value-of-the-marginal-product curve for capital is the firms ?
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A. supply curve of capital

B. production function

C. demand curve for capital

D. marginal cost curve

5086. An increase in the price of automobiles shifts the demand for autoworkers to the ?
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A. left and increases the wage

B. right and decreases the wage

C. right and increases the wage

D. left and decreases the wage

5087. An increase in the demand for a firms output ?
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A. decrease the prosperity of the firm but increases the prosperity of the factors hired by the firm

B. decreases the prosperity of both the firms and the factors hired by the firm.

C. increases the prosperity of both the firm and the factors hired by the firm.

D. increases the prosperity of the firm but decreases the prosperity of the factors hired by the firm.

5088. The most important factors of production are ?
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A. labor, land, and capital

B. management finance and marketing

C. water, earth and knowledge

D. money, stocks and bonds.

5089. Which of the following is not true with regard to workers who have a high value of marginal product? These workers ?
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A. have skills that are in relatively scarce supply

B. are usually highly paid

C. usually have little capital with which to work

D. produce output for which there is great demand

5090. When capital is owned by the firm as opposed to being directly owned by household capital income may take any of the following forms except ?
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A. retained earnings

B. dividends

C. interest

D. increases in stocks of goods
5091. Suppose that a war is fought will biological weapons. The weapons destroy people but not capital. What is likely to happen to equilibrium wages and rental rates after the war when compared to their values before the war ?
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A. Wages rise, and rental rates fall

B. Wages fall, and rental rates fall

C. Wages fall, and rental rates rise

D. Wages rise, and rental rates rise

5092. A decrease in the demand or fish ?
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A. increase the value of the marginal product of fishermen increase their wage and decreases employment in the fishing industry

B. decrease the value of the marginal product of fishermen reduces their wage, and reduces employment in the fishing industry

C. decrease the value of the marginal product of fishermen, reduces their wage, and increases employment in the fishing industry

D. increase the value of the marginal product of fishermen increase their wage, and increase employment in the fishing industry.

5093. The value of the marginal product of labor is ?
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A. the price of the output times the marginal product of labor

B. the wage of labor times the marginal product of labor

C. the price of the output times wage of labor

D. none of these answers

E. the wage of labor times the quantity of labor

5094. If both input and output markets are competitive and firms are profit maximizing, then in equilibrium each factor of production earns ?
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A. the value of its marginal product

B. an amount equal to the price of output times total output

C. the amount allocated by the political process

D. an equal share of output

5095. A value of 1 in Gini index represents ?
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A. 1% inequality

B. maximum inequality

C. 10/10 000% inequality

D. low inequality

5096. _________ is below the income that secures the bare essentials of food clothing and shelter ?
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A. purchasing power poverty

B. sens poverty index

C. Absolute poverty

D. Income inequality

5097. The Lorenz curve shows ?
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A. income concentration relative to a 45-degree line

B. the poorests income shares fall in the early stages of growth

C. patterns of poverty between developed and developing countries

D. the change in GDP per capita over time

5098. Indices of income distribution measure ?
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A. absolute poverty

B. standard of living

C. relative poverty

D. economic growth

5099. Peer borrowing groups of five or so people with joit liability approve loans to other members as a substitute for the banks screening process The above statement applies to ?
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A. Bangladeshs Grameen Bank

B. the Enterprice credit program in Kolkata

C. the Association for Development of Microenterprice

D. Indonesias Badan Kredit Kecamatan (BKK)

5100. The elasticity of propoor growth is ?
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A. the percentage increase in the poverty of the poor divided by percentage increase in the poverty of the nonpoor

B. the percentage increase in the consumption growth of the poor divided by percentage increase in the consumption growth of the nonpoor

C. the percentage increase in the poor times percentage increase in the nonpoor

D. the percentage increase in the poor people in the Urban divided by percentage increase in the nonpoor in the urban