economics MCQs – Page 265

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 Review each marked answer and report any item that may be outdated or unclear.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
5281. In the short run unemployment may fall below the natural rate of unemployment if ?
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A. Nominal wages have risen less than inflation

B. Nominal wages have risen less than unemployment

C. Nominal wages have risen at the same rate as inflation

D. Nominal wages have risen more than inflation
5282. An increase in aggregate demand is more likely to lead to demand pull inflation if ?
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A. Aggregate supply is unit elastic

B. Aggregate supply is perfectly elastic

C. Aggregate supply is Perfectly inelastic

D. Aggregate supply is relatively elastic

5283. Which of the following statements is correct ?
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A. The real interest rate is the nominal interest rate minus the inflation rate

B. The nominal interest rate is the real interest rate minus the inflation rate.

C. none of these answers

D. The nominal interest rate is the inflation rate minus the real interest rate

5284. Demand pull inflation may be caused by ?
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A. A reduction in government spending

B. An increase in costs

C. An outward shift in aggregate supply

D. A reduction in interest rate
5285. The price of one countrys currency in terms of another countrys currency is the ?
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A. balance of trade

B. terms of trade

C. exchange rate

D. currency validation

5286. Reducing inflation is a more important objective than economic growth is an example of ?
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A. Normative economics

B. Positive economics

C. Reality economics

D. Objective economics
5287. If the economy is in the expansionary phase of the business cycle, aggregate demand ____ unemployment ____ inflation ____ payments is likely to move towards ____?
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A. rise; falls; rises; deficit

B. falls; falls; falls; surplus

C. is static; low; rise; deficit;

D. falls; rise; falls; surplus

5288. If one country, with floating exchange rates, has higher inflation than its competitors we would expect its exchange rate to ?
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A. appreciate

B. revalue

C. depreciate

D. be in short supply

5289. If VAT rates rise, then costs are likely to ___ and demand is likely to ____?
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A. fall; fall

B. fall; rise

C. rise; rise

D. rise; fall
5290. The situation when a country imports more than it exports is ?
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A. a trade surplus

B. a trade deficit

C. an expansion.

D. a recession

5291. If the economy is in the recessionary phase of the business cycle, aggregate demand ___ unemployment ____ inflation ___ and the current account of the balance of payments is likely to move towards ____?
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A. falls; rises; falls; surplus

B. is static; low; rises; deficit

C. rises; falls; rises; deficit

D. falls; falls; falls; surplus

5292. When capital mobility is perfect interest rate differentials will tend to be offset by ?
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A. current account differences

B. expected exchange rate changes

C. balance of payments difference

D. Price difference

5293. If the Pakistan receives larger than expected revenues from exports then the exchange value of its currency will tend to ?
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A. depreciate

B. appreciate

C. fluctuate more than if exports were lower

D. not be affected

5294. A current account deficit means that a country may ?
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A. increase its stock of foreign assets

B. increases its foreign currency reserves

C. reduce its stock of foreign assets

D. increases its savings

5295. When the $/ exchange rate rises the pound _____ and when the $/ rates falls the pound ________?
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A. depreciates, appreciates

B. appreciates, depreciates

C. becomes more expensive becomes cheaper

D. revalues, devalues

5296. If currency dealers expect the value of the pound to fall, the exchange value will tend to ?
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A. fluctuate more than it would do therwise

B. not be affected

C. depreciate

D. appreciate

5297. Within the circular flow of income, an increase in domestic income will tend to increase ?
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A. inventories

B. exports

C. taxes

D. imports

5298. If Pakistans incomes rise faster than those in most other countries the the exchange value will tend to ?
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A. depreciate

B. appreciate

C. fluctuate more than it would do otherwise

D. not be affected

5299. Which of the following can the government not use directly to control the economy ?
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A. investment in education

B. Pay rates within the private sector

C. Benefits available for the unemployed and sick

D. pay rates in the public sector

5300. If the economy is in the though phase of the business cycle, aggregate demand ____ unemployment ______ inflation ______ and the current account of the balance of payments is likely to move towards ________?
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A. rises; falls; rises; deficit

B. falls; rises; falls; surplus

C. is static; low; rises; deficit

D. falls; falls; falls; surplus