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
951. The deadweight cost of the tariff equals ?
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A. $25,000

B. $10,000

C. $50,000

D. $75,000

952. In todays world, most countries impose tariffs ?
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A. only on imports

B. only on exports

C. on both imports and exports

D. on imports exports and nontraded goods

953. According to supply-side economists, as tax rates are reduced, labor supply should increase. This implies that ?
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A. there is no substitution effect when tax rates are changed

B. there is no income effect when tax rates are changed

C. the substitution effect of a wage change is greater than the income effect of a wage change

D. the income effect of a wage change is greater than the substitution effect of a wage change.

954. Adam smiths invisible hand concept suggests that a competitive market outcome ?
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A. maximizes total surplus

B. generates equality among the members of society

C. minimizes total surplus

D. both maximizes total surplus and generates equality among the members of society

955. The appropriate tax rate to consider gauging how much the tax system distorts incentives and decision making is the ?
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A. Proportional tax rate

B. vertical tax rate

C. marginal tax rate

D. average tax rate

E. horizontal tax rate

956. Suppose the price level falls but because of fixed nominal wage contracts the real wage rises and firms cut back on production This is a demonstration of the ?
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A. misperceptions theory of the short-run aggregate supply curve

B. sticky-price theory of the short run aggregate supply curve

C. classical dichotomy theory of the short-run aggregate supply curve

D. sticky-wage theory of the short-run aggregate supply curve
957. An increase in productivity should ?
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A. Lead to a contraction of supply

B. Lead to a higher equilibrium and lower equilibrium quantity

C. Lead to a shift in supply outwards (i.e more supplied at each and every price)

D. Lead to an expansion of supply

958. Internal balance refers to ?
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A. exports minus imports

B. full employment and price stability

C. exports equal to imports

D. monetary policy offsetting fiscal policy

959. Jamil has ten pairs of football boots and saleem has none. A pair of football boots cost Rs50. to produce. If jamil values an additional pair of boots at RS100 and saleem values a pair of boots at Rs40, then the maxime ?
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A. efficiency Saleem should receive the glove

B. Efficiency Jamil should receive the glove

C. equity Jamil should receive the glove

D. consumer surplus both should receive a glove

960. Increased level consumption ?
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A. shift aggregate supply to the right

B. shift aggregate demand to the left

C. shift aggregate supply to the left

D. shift aggregate demand to the right

961. The opportunity cost of a student is____________?
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A. What the student could have earned in the best job available by not studying

B. A loan from the bank

C. Course fees and rent

D. What the student will earn after graduation

962. Which of the following statements is true ?
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A. Long-term bonds tend to pay less interest than short-term bonds

B. Investment funds are riskier than single stock purchases because the performances of so many different firms can affect the return of a mutual fund

C. Government bonds pay less interest than comparable corporate bounds

D. A stock index is a directory used to locate information about selected stocks.

963. If your income doubles and the prices of the goods you buy double then your demand for these goods will likely?
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A. shift

B. not change

C. increase

D. decrease

964. An increase in the price of a good along a stationary demand curve ?
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A. improves the material welfare of the buyers.

B. decrease consumer surplus

C. increase consumer surplus.

D. improves market efficiency.

965. In his empirical tests, Wassily Leontief used an input-output table to ?
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A. calculate the capital productivity of American capital relative to foreign capital

B. All of the above

C. calculate the labor productivity of America workers relative to foreign workers

D. calculate the capital and labor required to produce $1 million of U.S exports and imports
966. In developed countries, tariffs on raw materials tend to be ?
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A. equal to tariffs on manufactured goods

B. higher than on manufactured goods

C. highest of all

D. lower than on manufactured goods
967. The industrial concentration ratio is the proportion of an industrys output ?
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A. as a percentage of production and marketing

B. produced by the three largest firms in the industry

C. and labor intensities relative to labor productivity

D. produced in cement, machine tools and steel industries

968. An increase in the price of a good along a stationary supply curve______________?
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A. decrease producer surplus

B. improves market equity

C. increase producer surplus

D. does all the things describe in these answers

969. A way of helping depressed regions by having lower wages lower local taxes and lower unemployment benefit has been suggested as ?
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A. market-orientated economists

B. Keynesian.

C. left-wing theorists

D. new-Keynesian

970. Which best describes a demand curve ?
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A. The quantity consumers are willing to sell

B. The quantity consumers are willing and able to buy each and every price all other things changed

C. The quantity consumers are willing and able to buy at each and every income all other things unchanged

D. the quantity consumers would like to buy in an ideal world

971. A tariff that prohibits imports has only ?
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A. consumption effect and protection effect

B. revenue effect and protection effect

C. redistribution effect and consumption effect

D. a revenue effect and redistribution effect

972. A tariff ______ increase a country overall welfare?
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A. can sometimes

B. will always

C. None of the above

D. will never

973. Refers to Exhibit 4. Suppose the economy is operating in a recession such as point B in Exhibit 4. If policy makers wished to move output to its long run natural rate they should attempt to ?
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A. shift short-run aggregate supply to the right

B. shift aggregate demand to the right

C. Shift short run aggregate supply to the left

D. Shift aggregate demand to the left

974. Improved training of employees would ?
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A. Shift aggregate demand to the right

B. Shift aggregate supply to the left

C. Shift aggregate supply to the right

D. shift aggregate demand to the left

975. The increase in total cost when one more unit is produced is known as ?
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A. limited cost

B. marginal cost

C. opportunity cost

D. average cost
976. If no imported inputs (hard-disk drive) go into the domestic production of a final product (desktop computer) then the ?
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A. nominal tariff rate on the final product equals the effective tariff rate on the product

B. nominal tariff rate on the final product is less than the effective tariff rate on the final product

C. nominal tariff rate on the final product is greater than the effective rate on the product

D. None of the above

977. If a producer has market power (can influence the price of the product in the market) then free market solutions ?
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A. are inefficient

B. are equitable.

C. maximize consumer surplus

D. are efficient

978. The price of apples falls by 5% and quantity demanded increases by 6% This means that demand is ?
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A. elastic

B. zero elastic

C. perfectly elastic

D. inelastic

979. Suppose that the price of a new bicycle is Rs300 Natalie values a new bicycle at Rs 400 it costs Rs200 for the seller to produce the new bicycle. What is the value of total surplus if Natalie buys a new bike ?
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A. Rs500

B. Rs300

C. Rs400

D. Rs200

980. An increase in price all other things unchanged leads to ?
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A. An extension of demand

B. Shift demand outwards

C. A contractions of demand

D. Shift demand inwards

981. If a product is an inferior good ?
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A. Demand in inversely related to price

B. Demand is inversely related to the price of substitutes

C. Demand is inversely related to income

D. Demand is directly related to price

982. According to the Laffer curve, as tax rates increase tax revenue ?
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A. initially decrease and then increase.

B. initially increase and then decrease

C. rise continuously

D. decrease continuously.

983. The marginal tax rate is ?
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A. total income divided by total taxes paid

B. total taxes paid divided by total income

C. the extra taxes paid on an additional unit of income

D. the taxes paid by the marginal worker

984. Marginal revenue is the ________ when output is __________?
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A. Change in total revenue, increase by one unit

B. change in average revenue, increased by one unit

C. change in total revenue increased

D. Change in average revenue, increased

985. According to the model of aggregate supply and aggregate demand in the long run an increase in the money supply should cause ?
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A. Prices to fall and output to fall

B. Prices to rise and output to rise

C. Price to fall and output to remain unchanged

D. prices to rise and output to remain unchanged
986. Privatization is the transfer of ?
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A. government businesses to the private sector.

B. corporately owned businesses to individuals

C. publicly held stock to private individuals

D. privately owned businesses to the government sector

987. If the quantity demanded of beef increases by 5% when the price of chicken increase by 20% the cross-price elasticity of demand between beef and chicken is ?
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A. 0.25

B. -0.25

C. -4

D. 4

988. Refer to Exhibit 4. If a tax is placed on the product in this market consumer surplus is the area ?
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A. A

B. A + B + E

C. A + B +C + D

D. D

989. 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. 2

B. -2

C. +0.5

D. -0.5

990. If I purchase a stereo from South Korea, I obtain the stereo and South Korea obtains the dollars But if I purchase a stereo produced in the Pakistan I obtain the stereo and the rupees remain in Pakistan, This line of reasoning is ?
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A. deceiving since the dollars spent on a stereo built in the Pakistan eventually wind up overseas

B. deceiving since Koreans eventually spend the dollars on Pakistani goods

C. valid for stereos, but nor for most products imported by Pakistan

D. valid for most products imported by Pakistan but not for stereos

991. Which of the following is not a quasi-public good ?
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A. an automobile

B. fire protection

C. national defense

D. libraries

992. If the government increases investment tax credits and reduces taxes on the return to saving at the same time ?
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A. the real interest rate should rise

B. the impact on the real interest rate is indeterminate

C. the real interest rate should not change

D. the real interest rate should fall

993. A financial intermediary is a middleperson between ?
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A. labor unions and firms

B. borrowers and lenders.

C. husbands and wives.

D. buyers and sellers

994. A tariff can _______ raise a countrys welfare?
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A. never

B. always

C. sometimes

D. None of these

995. A development bank based in London, which loans funds to governments of Eastern Europe and the former Soviet Union is the ?
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A. European Bank for Reconstruction and Development

B. World Bank

C. OECD

D. Transitional Monetary Fund

996. An increase in aggregate demand will have most effect on prices if ?
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A. Aggregate supply has a unitary price elasticity

B. Aggregate supply is price inelastic

C. Aggregate demand is price inelastic

D. Aggregate supply is price elastic
997. Refer to Exhibit 4. If there is no tax placed on the product in this market, producer surplus is the area ?
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A. A + B + E

B. D

C. C + F

D. C + D + F
998. Reaganomics was a radical shift in policy aimed at directly tackling ?
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A. the charities economy

B. the supply side of the country

C. the demand side of the economy

D. the underground economy

999. Suppose that Pakistan imposes a tariff on ballpoint pens of 25 rupees per pen plus 12 percent of the pens value, this is an example of a (an) ?
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A. effective tariff

B. compound tariff

C. specific tariff

D. ad valorem tariff

1000. With free trade the total quantity of imports would equal ?
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A. 50,000 units

B. 10,000 units

C. 42,000 units

D. 40,000 units