economics MCQs – Page 131

Practise multiple-choice questions from economics for competitive examinations and subject revision. Review each marked answer and report any item that may be outdated or unclear.

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
2601. A profit maximizing firm is perfect competition produces where ?
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A. Total revenue is maximized

B. Marginal revenue equals average cost

C. Marginal revenue equals marginal cost

D. Marginal revenue equals zero

2602. Suppose, due to political instability, Russians suddenly choose to invest in UK assets as opposed to Russian assets Which of the following statements is true regarding UK net foreign investment ?
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A. UK net foreign investment is unchanged because only UK residents can after UK net foreign investment

B. None of the above

C. UK net foreign investment rises

D. UK net foreign investment falls
2603. Governments use of coordinated policies to achieve national economic objectives is ?
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A. development planning

B. commanding heights

C. entrepreneurial programs

D. public physical policy

2604. The opportunity cost of growth is ?
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A. a reduction in current investment

B. a reduction in current saving

C. a reduction in taxes

D. a reduction in current consumption
2605. The marginal product model assumes that ?
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A. government subsidizes schooling

B. individuals pay the full cost of their education

C. education persons migrate more

D. capital and unskilled labor are complements

2606. When economists say that developing countries have a dualistic economy the 2 parts referred to are ?
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A. rich people and poor people

B. modern sector and traditional sector

C. men and women

D. town and country

2607. Gunnar Myrdal argues that a major barrier to high labor productivity is ?
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A. The lack of bargaining power y cheap labor

B. a class system in which the elite are contemptuous of manual work

C. due to a lack of education

D. upper-and middle-class westerners

2608. Which of the following factors has been suggest as an explanation for the lack of economic growth in many poor nations ?
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A. An adequate level of social overhead capital

B. A steady rate of capital formation

C. The constraints imposed by dependency on the already-developed nations

D. The supply of human resources is too high

2609. Technological improvements in agriculture that shift the supply of agricultural commodities to the right tend to ?
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A. reduce total revenue to farmers as a whole because the demand for food is elastic

B. reduce total revenue to farmers as a whole because the demand for food is inelastic

C. increase total revenue to farmers as a whole because the demand for food is elastic

D. increase total revenue to farmers as whole because the demand for food is inelastic

2610. In the long run in perfect competition ?
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A. Total revenue = Total variable cost

B. price = marginal cost = total cost

C. price = average cost = total cost

D. price = average cost = marginal cost
2611. A reasonable measure of the standard of living in a country is ?
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A. real GDP per person

B. The growth rate of nominal GDP per person

C. Real GDP

D. nominal GDP per person.

2612. Refer to Exhibit 4, Suppose that the consumer must choose between buying socks and belts Also suppose that the consumers income is 100 Suppose that the price of a pair of socks falls from 5 to 2 The income effect is represented by the movement from point ?
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A. Y to point X

B. X to point Z

C. Z to point X

D. X to point Y
2613. Which of the following is NOT true about child mortality ?
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A. 19 of the 20 countries with the highest child mortality were in Africa

B. World-wide child mortality rates increased from 1990 to 2002

C. About 18 percent of the worlds deaths are among children less than five years old

D. More than 98 percent of child deaths were in LDCs

2614. Why has modern economic growth mainly been in western countries ?
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A. the use of the medieval economy

B. a strong Catholic church intervention in the economic decisions

C. an emphasis on trade restrictions

D. the rise of capitalism
2615. in long-run equilibrium in a competitive market, firms are operating at ?
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A. their efficient scale

B. intersection of marginal cost and marginal revenue

C. all of these answers are correct

D. the minimum of their average-total-cost curves

E. zero economic profit

2616. Dani Rodrik points out that ?
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A. financial liberalization in LDCs leads to collapse of the economy

B. globalization increases job insecurity

C. employers and consumers can more readily replace domestic workers with foreign workers by investing abroad or buying imports

D. an economy more open to foreign trade and investment faces a more inelastic demand for unskilled workers

2617. The consumers optimal purchase of any two goods is the point where ?
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A. the consumer reaches the highest indifference curve subject to remaining on the budget constraint

B. the consumer has reached the highest indifference curve

C. the two highest indifference curves cross

D. the budget constraint crosses the indifference curve

2618. Which of the following groups would be most harmed by a UK government budget deficit ?
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A. Foreigners who wish to buy assets in the UK

B. BAe Systems wishing to sell aircraft to Saudi Arabia

C. Lenders of loanable funds

D. UK residents wishing to buy foreign Produced cars

2619. In the long run, the competitive firms supply curve is the ?
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A. upward-sloping portion of the average total cost curve

B. portion of the marginal cost curve that lies above the average variable cost curve.

C. upward-sloping portion of the average variable cost curve

D. entire marginal cost curve

E. portion of the marginal cost curve that lies above the average total cost curve
2620. An agreement between a borrower country and the International Monetary Fund in which the country agrees to revamp its economic policies to provide incentives for higher export earnings and lower imports is a ?
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A. stabilization program

B. debt service agreement

C. program for growth

D. debt rescheduling agreement