economics MCQs – Page 411

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 Review each marked answer and report any item that may be outdated or unclear.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

8201. All of the following are types of imperfect competition except ?
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A. monopoly

B. unfair competition

C. oligopoly

D. monopolistic competition

8202. Tax shifting ?
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A. occurs when house hold can alter their behaviour and do something to avoid paying a tax.

B. occurs when taxes cause prices to increase but wages to fall

C. is the ultimate distribution of a taxs burden

D. is the way in which a tax is structured

8203. Market failure may arise because of ?
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A. all of the above

B. taxation

C. imperfect competition

D. externalities

E. missing markets

8204. A dominant strategy is ?
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A. a players best strategy whatever the strategies adopted by rivals

B. a players best strategy when moving first

C. a losing strategy

D. a wining strategy

8205. The allocation of resources is not efficient if ?
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A. unemployment is high

B. the marginal cost of production does not equal societys marginal benefit

C. the distribution is inequitable

D. economic growth is low

8206. Which of the following statements is true about the impact of an increase in the price of lettuce ?
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A. Both the demand for lettuce will decrease and the equilibrium price and quantity of salad dressing will fall

B. The supply of lettuce will decrease

C. The demand for lettuce will decrease

D. The equilibrium price and quantity of salad dressing will fall

E. The equilibrium price and quantity of salad dressing will rise

8207. A reduction in the costs of production will ?
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A. Shift the supply curve

B. Lead to an extension of supply

C. Lead to a movement along the supply curve

D. Shift the demand curve

8208. In the insurance industry, high-risk customers are more likely to take out insurance. This is an example of ?
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A. risk aversion

B. adverse selection

C. moral hazard

D. a poor gamble

8209. Nationalisation occurs when ?
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A. The government taxes a product to a raise its price

B. The government sells assets to a the private sector

C. The government bans a product

D. The government takes control of an industry

8210. An increase in demand for a product should ?
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A. Increase equilibrium price and decrease quantity

B. Increase equilibrium price and quantity

C. Decrease equilibrium price and quantity

D. Decrease equilibrium price and increase quantity

8211. Which best describes consumer surplus ?
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A. The profits made by a firm

B. The cost of providing a unit

C. The price consumers are willing to pray for a unit

D. The difference the price a consumer pays for an item and the price he/she is willing to pay

8212. Where a tax can be shifted, the incidence depends on ?
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A. how many producers there are:

B. who is legally obliged to pay the tax

C. Whether there is perfect or imperfect information

D. elasticities of demand and supply

8213. Income inequality can be high in the free market and should be reduced This is an example of What ?
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A. Normative economic statement

B. Formative economic statement

C. Positive economic statement

D. Judicial economic statement

8214. If the price in a market is fixed by the government above equilibrium ?
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A. There is excess demand

B. There is excess supply

C. There is excess equilibrium

D. There is equilibrium

8215. If a maximum price is set below equilibrium there will be ?
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A. Excess demand

B. A price increase

C. Excess supply

D. A price fall

8216. The law of supply states that an increase in the price of a good ?
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A. increases the quantity supplied of that good

B. decrease the quantity demanded for that good

C. decrease the demand for the good

D. increase the supply of that good

E. none of these answers

8217. If the price of good is below the equilibrium price ?
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A. the quantity demanded is equal to the quantity supplied and the price remains unchanged

B. there is a surplus and the price will rise

C. there is a shortage and the price will rise

D. there is a shortage and the price will fall

8218. Suppose both buyers and sellers of wheat expect the price of wheat to rise in the near future. What would we expect to happen to the equilibrium price and quantity in the market for wheat today ?
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A. The impact on both price and quantity is ambiguous

B. Price will decrease, quantity is ambiguous.

C. price will increase, quantity will decrease

D. price will increase, quantity is ambiguous.

E. Price will increase, quantity will increase

8219. An allocation is Pareto-efficient if no reallocation of resources would make some people _______ without making others ________?
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A. equal, unequal

B. better off; worse off

C. worse off; worse off

D. better off; better off

8220. A positive externality occurs when ?
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A. The social marginal benefits are higher than the private marginal benefits

B. A product is not provided in the free market

C. The social marginal costs are higher than the private marginals costs

D. The social marginal cost equal the social marginal benefit

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