economics MCQs – Page 241

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 Review each marked answer and report any item that may be outdated or unclear.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 economy 2. profit maximizing under perfect competition and monopoly 3. application of economics 4. the aggregate demand aggregate supply model 5. surplus 6. money interest rates and output 7. average and total cost 8. stabilization adjustment reform and privatization 9. risks and diversification efficient market hypothesis 10. the phillips curve 11. supply and demand 12. capital formation investment choice information technology and technical progress 13. aggregate supply unemployment and inflation 14. elasticity 15. comparative gdp 16. roots of modern macroeconomics 17. production factors 18. poverty malnutrition and income inequality 19. trade regulations and industrial policies 20. monetary union 21. exchange rate systems and currency crises 22. economic development in historical perspective 23. exchange rate determination 24. monopoly competition 25. the balance of payments 26. inflation productivity 27. macroeconomic issues and analysis 28. employment migration and urbanization 29. macroeconomic policy tools 30. supply side policies 31. exchange rate adjustments and the balance of 32. miscellaneous 33. taxation 34. trade policies for the developing nations 35. markets efficiency and the public interest 36. the external debt and financial crises 37. budget deficits and the trade balance 38. alternative theories of the firm 39. public goods 40. the meaning and measurement of economic development 41. characteristics and institutions of developing countries 42. agriculture irrigation system of pakistan 43. education health and human capital 44. economic problems of developing countries 45. theories of economic development 46. basic of economics 47. consumer theory vs real consumers 48. applied microeconomics 49. long term economic growth 50. externality internality 51. fiscal and monetary policy 52. prices wages taxes 53. balance of payments aid and foreign investment 54. international factor movements and multinational corporations 55. entrepreneurship organization and innovation 56. the international economy and globalization 57. population and development 58. non tariff trade barriers 59. foundations of modern trade theory 60. global economic development 61. market 62. rural poverty and agricultural transformation 63. regional trading arrangements 64. foreign exchange 65. introduction to economics 66. world economy miscellaneous 67. sources of comparative advantage 68. natural resources and the environment toward sustainable development 69. monopoly 70. asymmetric information 71. income inequality 72. labour market 73. tariffs 74. development planning and policy making the state and the market 75. oligopoly 76. industrial development 77. costs supply and perfect competition 78. human capital 79. monetary fiscal and incomes policy and inflation 80. stocks

4801. If the keep some money available in case I see a bargain this is an example of ?
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A. precautionary demand for money

B. transactions demand for money

C. asset demand for money

D. token demand for money

4802. If The Central bank tries to keep the interest rate constant when the economy is operating on the steep part of the AS curve, _________ will occur?
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A. stagflation

B. a hyperinflation

C. a depression

D. a recession

4803. An example of an expansionary monetary policy is ?
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A. an increase in the discount rate

B. an increase in the required reserve ratio

C. the Central bank buying government securities in the open market

D. a reduction in the taxes banks pay on their profits.

4804. A checking deposit in a bank in considered _________ of that bank?
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A. capital

B. a liability

C. net worth

D. an asset

4805. If the banks in an economy operate with a reserve ratio of 20 percent then the money multiplier is ?
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A. 20

B. 5

C. 4

D. 25

4806. When marginal costs are below average total costs ?
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A. average fixed cost is rising

B. average total cost is minimized

C. average total cost is raising

D. average total cost is falling

4807. If there are implicit costs of production ?
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A. economic profit will always be zero

B. economic profit and accounting profit will be equal

C. accounting profit will always be zero

D. economic profit will exceed accounting profit

E. accounting profit will exceed economic profit

4808. If a production function exhibits diminishing marginal product the slope of the corresponding total-cost curve ?
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A. becomes steeper as the quantity of output increases

B. is liner (a straight line)

C. could be any of these answers

D. become flatter as the quantity of output increases.

4809. If a production function exhibits diminishing marginal product. its slope ?
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A. becomes flatter as the quantity of the input increase

B. is linear (a straight line)

C. becomes steeper as the quantity of the input increase

D. could be any of these answers

4810. The efficient scale of production is the quantity of output that minimizes ?
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A. average total cost

B. average fixed cost

C. average variable cost

D. marginal cost

4811. Naila owns a small pottery factory. She can make 1000 pieces of pottery per year and sell them for Rs 100 each. It costs Naila Rs 20,000 for the raw materials to produce the 1,000 pieces of pottery She has invested Rs100,000 in her factory and equipment: Rs50,000 from her savings and Rs50,000 borrowed at 10 per cent. (Assume that she could have loaned her money out at 10 her per cent, too) Naila can work at a competing pottery factory for Rs40,000 per year. The accounting profit at Nailas pottery factory is ?
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A. Rs75,000

B. Rs35,000

C. Rs70,000

D. Rs30,000

4812. In the long run, if a very small factory were to expand its scale of operations it is likely that it would initially experience ?
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A. economies of scale

B. diseconomies of scale

C. an increase in average total costs

D. constant returns to scale

4813. If as the quantity produced increase a production function first exhibits increasing marginal product and later diminishing marginal product, the corresponding marginal-cost curve will ?
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A. slope upward

B. slope downward

C. be U-shaped.

D. be flat (horizontal)

4814. Which of the following is a variable cost in the short run ?
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A. rent on the factory

B. salaries paid to upper management

C. wages paid to factory labor

D. payments on the lease for factory equipment

E. interest payments on borrowed financial capital

4815. If marginal costs equal average total costs ?
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A. average total cost is minimized

B. average total cost is raising

C. average total cost is falling

D. average total cost is maximized

4816. Accounting profit is equal to total revenue minus ?
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A. variable costs

B. marginal costs

C. the sum of implicit and explicit costs.

D. implicit costs

E. explicit costs.

4817. Economic profit is equal to total revenue minus ?
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A. marginal costs

B. implicit costs

C. explicit costs

D. variable costs

4818. Which of the following statements is true ?
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A. All costs are variable in the long run

B. All costs are fixed in the long run

C. All costs are variable in the short run

D. All costs are fixed in the short run.

4819. Naila owns a small pottery factory. She can make 1000 pieces of pottery per year and sell them for Rs 100 each. It costs Naila Rs 20,000 for the raw materials to produce the 1,000 pieces of pottery She has invested Rs100,000 in her factory and equipment: Rs50,000 from her savings and Rs50,000 borrowed at 10 per cent. (Assume that she could have loaned her money out at 10 her per cent, too) Naila can work at a competing pottery factory for Rs40,000 per year. The economics profit at Nailas pottery factory is ?
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A. Rs70,000

B. Rs75,000

C. Rs30,000

D. Rs80,000

4820. In 1979-80 China first created _____ for foreigners to set up enterprises hire labor and import duty-free goods for processing and re-exporting ?
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A. Economic Union zones

B. liberalized trade monopoly zones

C. special economic zones

D. Communist free trade areas

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