economics MCQs – Page 441

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 Review each marked answer and report any item that may be outdated or unclear.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

8801. The total amount of tax you pay divided by your total income is the ?
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A. average tax rate

B. proportional tax rate

C. total tax rate

D. marginal tax rate

8802. An unemployed salesperson has been offered a job paying Rs500 a week. He turns that job down and continues to search for another job that pays more. The cost of this continued search is ?
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A. Rs difference between the weekly salary he finally accepts and the Rs500 weekly salary that he has forgone

B. The Rs500 weekly salary that he has forgone and the monetary costs incurred by continuing to search

C. the Rs500 weekly salary that he has forgone to search for another job

D. Rs0, since he is currently unemployed

8803. If output price is constant, the marginal revenue product of labour curve will have the same shape as the ?
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A. total variable cost curve

B. marginal product of labour curve

C. total product of labour curve

D. marginal cost curve

8804. An example of an indirect tax is ?
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A. VAT

B. inheritance tax

C. income tax

D. a tax on profits.

8805. Current anti-poverty programs discourage work because ?
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A. anti-poverty programs attract naturally lazy people to begin with.

B. benefits are reduced at such a high rate when recipients earn more income that there is little or no incentive to work once one is receiving benefits.

C. they make recipients more comfortable than most middle-class citizens.

D. in order to be eligible for benefits a recipient cannot have a job

8806. If the income effect is smaller than the substitution effect, higher net wages will ?
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A. reduce the supply of labour.

B. increase the demand for labour

C. increase the supply of labour

D. have no effect on the supply of labour

8807. Permanent income is ?
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A. equal to the minimum wage

B. none of these answers

C. Social Security income of the elderly and disabled

D. wages fixed by a union or other labour contract

E. a persons normal or average income

8808. Supply of land in a given use ?
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A. will be upward sloping because as land becomes more valuable in once use, the amount of land made available for that use will increase

B. will be perfectly inelastic in the long run. but upward sloping in the short run

C. is perfectly elastic since there is fixed amount of land

D. is perfectly inelastic since there is a fixed amount of land

8809. A tax whose burden is the same proportion of income for all households is ?
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A. an equal tax

B. a regressive tax

C. a proportional tax

D. a progressive tax

8810. New technology in the form of computer spreadsheets has increased the productivity of accountants. This will cause ?
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A. firms to move up their demand curves for accountants

B. firms to move down their demand curves for accountants

C. the demand curve for accountants to shift to the left, since it requires fewer accountants than it did before to do the same amount of work.

D. the demand curve for accountants to shift to the right, since the productivity of accountants has increased

8811. Because peoples income vary other the life cycle and because there are transitory shocks to peoples incomes the standard measures of income distribution ?
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A. understate the inequality of living standards

B. exaggerate the inequality of living standards

C. could exaggerate or understate the inequality of living standards depending on whether the transitory shocks are positive or negative

D. accurately represent the true inequality of living standards

8812. Tax incidence is the ?
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A. structure of the tax.

B. ultimate distribution of a taxs burden

C. behaviour of shifting the tax to another party

D. measure of the impact the tax has on employment and output

8813. A tax whose burden expressed as a percentage of income, falls as income increases is a ?
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A. benefits received tax

B. progressive tax

C. regressive tax

D. proportional tax

8814. VAT is a good example of which kind of tax ?
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A. Ad valorem

B. specific

C. Excise duty

D. Direct

8815. Differences in wages that result from differences in working conditions are known as ?
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A. compensating differentials

B. occupational differentials

C. job differentials.

D. search differentials

8816. Utilitarianism suggests that the government should choose policies that maximize the total utility of everyone in society by ?
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A. redistributing income from rich to poor because this is what the members of society would choose to do if they were behind a veil of ignorance

B. redistributing income from rich to poor because due to the diminishing marginal utility of income, taking a pound from the rich reduces their utility by less than the gain in utility generated by giving a pound to the poor

C. allowing each individual to maximize their own utility without interference from the government

D. istributing income from rich to poor because this would maximize the well-being of the worst-off person in society

8817. Unemployment benefits may increase the unemployment rate because unemployment benefits ?
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A. encourage people to quit their jobs

B. reduce the cost of job search

C. reduce the benefits of additional job searching

D. enable people to quit searching for work

8818. The substitution effect of higher wages suggests that as the wage rate increases ?
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A. leisure becomes less expensive and households buy less of it.

B. leisure becomes more expensive and households buy more of it

C. leisure becomes more expensive and households buy less of it

D. leisure becomes less expensive and households buy more of it

8819. If labour market discrimination crowds women into a limited number of occupations so that the number of occupations available to men increases, then ?
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A. wages of men will be higher but the marginal productivity of men will be lower than it otherwise would be

B. the wages of men will be lower but the marginal productivity of men will be higher than it otherwise would be

C. both the wages and the marginal productivity of men will be lower than they otherwise would be

D. both the wages and the marginal productivity of men will be higher than they otherwise would be

8820. A Gini coefficient of one means that ?
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A. one family has all the income and every one else has nothing.

B. income is distributed equally

C. all the income is received by the top 20% of the income distribution

D. the income is split equally between the top 20% and the rest of the distribution.

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