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
2201. An increase in injections into the economy may lead to ?
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A. An outward shift of aggregate demand- and demand-pull inflation

B. An outward shift of aggregate supply and cost push inflation

C. An outward shift of aggregate demand and cost push inflation

D. An outward shift of aggregate supply and demand-pull inflation

2202. Refer to Figure 1. The unemployment rate is ?
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A. 3.2 Percent

B. 5.8 Percent

C. Not Enough

D. 5.7 Percent

2203. Surgical instruments are made in ?
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A. Wazirabad

B. Gujranwala

C. Lahore

D. Sialkot

2204. An increase in aggregate demand is more likely to lead to demand pull inflation if ?
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A. Aggregate supply is relatively elastic

B. Aggregate supply is Perfectly inelastic

C. Aggregate supply is unit elastic

D. Aggregate supply is perfectly elastic

2205. All of the following are potential advantages of an international joint venture except ?
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A. establishing work rules promoting higher labor productivity

B. operating at diseconomy-of-scale output levels

C. forestalling protectionism against imports

D. sharing research and development cost among corporations

2206. Which of the following types of unemployment will exist even if the wage is at the competitive equilibrium ?
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A. Unemployment due to unions

B. Frictional Unemployment

C. Unemployment due to efficiency wages

D. Unemployment due to minimum-wage laws

2207. With fixed exchange rates and no private currency flows, when the central bank buys domestic currency the domestic money supply is ?
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A. None of these

B. reduced

C. unaffected

D. increased

2208. The Wah is famous for ?
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A. Ordnance factory

B. Mughal Garden

C. Both of them

D. None of them

2209. In the short run, the supply of capital is ________ and in the long run will depend on _______?
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A. fixed, expectations

B. variable, technology

C. variable, interest rates

D. fixed, rental rate of capital
2210. The migration of employable workers from low-paying nations to high-paying nations tends to decrease ?
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A. the productivity of labor

B. wage disparities

C. total wage income in the world

D. business or capitalist income in the world

2211. The basket on which the CPI is based is composed of ?
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A. consumer production

B. raw materials purchased by firms

C. Products purchased by the typical consumer

D. none of these answers

E. total current production

2212. Public goods are difficult for a private market to provide due to ?
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A. The free-rider problem.

B. the rivalness problem

C. the Tragedy of the Commons.

D. the public goods problem

2213. The business cycle is not transmitted from one country to another through ?
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A. labor supply changes

B. private sector imports and exports

C. the duration of compulsory education

D. economic policy

2214. Which of the following would probably cause the CPI to rise more than the GDP deflator in the Pakistan ?
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A. An increased in the Price of domestically produced armoured vehicles sold exclusively to Iran

B. An increase in the price of helicopters purchased by the Pak Navy.

C. An increase in the price of BMWs produced in Germany and sold in the Pakistan

D. An increase in the price of Peugeots produced in the Pakistan

2215. Refer to Figure 24-1 What is the value of the basket in the base year ?
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A. None of these

B. Rs459.25

C. Rs300

D. Rs418.75

2216. If the US economy is forecast to come out of recession because military expenditure has increase then the exchange value of the UK pound will tend to ?
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A. not be affected

B. appreciate

C. fluctuate more than it would do therwise

D. depreciate

2217. A common resource is ?
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A. not rival but excludable

B. both rival and excludable

C. rival but not excludable

D. neither rival nor excludable

2218. Which of the following statements regarding discrimination is true ?
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A. The existence of a wage differential among groups is strong evidence of discrimination in the labour market

B. Discrimination cannot exist in a competitive labor market

C. Bigoted employers are the main source of a persistent discriminatory wage differential in a competitive market

D. Discrimination can only persist in a competitive labour market it customers are willing to pay to maintain the discriminatory practice or the government requires discrimination
2219. If there is an increase in the price of apples which causes consumers to purchase fewer kilograms of apples and more kilograms of oranges, the CPI will suffer from ?
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A. bias due to unmeasured quality change

B. bias due to the introduction of new goods.

C. none of these answers

D. substitution bias

E. base year bias

2220. Union might increase efficiency in the case Where they ?
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A. Raise the wage for insiders above the competitive equilibrium

B. Threaten a strike but dont actually follow through so there are not lost hours of work

C. Offset the market power of a large firm that is the dominant employer in a region

D. Lower the wage of local outsiders

2221. 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 cost curve

C. total product of labour curve

D. marginal product of labour curve
2222. Land will be allocated between competing uses so that ?
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A. farming gets priority

B. industry gets priority

C. the equilibrium rental rate equilibrium total demand with supply

D. housing gets priority

2223. The marginal revenue product of labour is ?
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A. the additional revenue a firm earns by employing on additional unit of labour

B. the marginal product of capital times the price of labour.

C. the additional revenue the firm makes by selling one unit of labour.

D. the additional profit a firms earns by employing one additional unit of labour

2224. The effect of inflation on the price competitiveness of a countrys products may be offset by ?
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A. A depreciation of the currency

B. An appreciation of the currency

C. Lower inflation abroad

D. A revaluation of the currency

2225. The golden-rule saving rate is the rate of saving that ?
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A. gets the highest rate of interest

B. maximizes the level of long-run consumption

C. maximizes the level of long-run investment

D. maximizes human capital

2226. Multinational corporations ?
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A. None of the above

B. always produce primary goods

C. always produce manufactured goods

D. produce primary goods or manufactured goods
2227. Refer to Figure 1 The labour fouce is ?
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A. 92.3 million

B. 98.0 million

C. 134.0 million

D. None of theses answers

2228. Demand pull inflation may be caused by ?
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A. A reduction in interest rate

B. An increase in costs

C. A reduction in government spending

D. An outward shift in aggregate supply

2229. The impossibility of negative gross investment provides a ______ to fluctuation in ______?
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A. ceiling, stock building

B. ceiling, capital prices

C. floor, the capital-output ratio

D. floor, output
2230. Firms undertake multinational operations in order to ?
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A. obtain necessary factor inputs

B. All of the above

C. hire low-income workers

D. manufacture in nations they have difficult exporting to

2231. Vertical equity holds that ?
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A. those with equal ability to pay should bear unequal burdens

B. those who benefit the most from government service should bear the higher tax burden

C. those will equal ability to pay should bear equal tax burdens.

D. those with greater ability to pay should pay more
2232. The Gini coefficient is ?
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A. the ratio of the percentage of total income received by the top 20% of families to the percentage of total income received by by the bottom 20% of families

B. the most common way of representing the income distribution graphically

C. a commonly used measure of the degree of inequity in an income distribution

D. a commonly used measure of the degree of inequality in an income distribution

2233. If the nominal interest rate is 7 percent and the inflation rate is 3 percent, then the real interest rate is ?
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A. 4 percent

B. 10 percent

C. 3 percent

D. 21 percent

E. -4 percent

2234. Accusations of American labor unions against U.S multinational firms include all of the following except ?
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A. export jobs by shifting investment overseas

B. export jobs by shifting technology overseas

C. operating at output levels where scale economies occur

D. enjoy unfair advantage in taxation

2235. An example of an indirect tax is ?
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A. income tax

B. a tax on profits.

C. VAT

D. inheritance tax

2236. A tax whose burden expressed as a percentage of income, falls as income increases is a ?
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A. regressive tax

B. progressive tax

C. proportional tax

D. benefits received tax

2237. Current anti-poverty programs discourage work because ?
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A. 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.

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

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

D. anti-poverty programs attract naturally lazy people to begin with.

2238. If a nations interest rates are relatively low compared to those of other countries. then the exchange value of its currency will tend to ?
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A. not be affected

B. appreciate

C. fluctuate more than if interest rates were high

D. depreciate
2239. An increase in the wage rate ?
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A. is illegal in a free market

B. will cause a shift in the demand for labour

C. Will decrease total earning if the demand for labour is wage elastic

D. Will usually lead to more people employed

2240. Identify below what is NOT considered to be a cause of economic growth ?
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A. An increase in labor productivity

B. An increase in the quantity of labor and capital

C. An increase in technology

D. An increase in the money supply
2241. Multinational corporations face problems since they ?
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A. cannot benefit from the advantage of comparative advantage

B. can only invest at home but not overseas

C. can only invest overseas but not at home

D. may raise political problems in countries where their subsidiaries operate
2242. Less demand in the economy may increase unemployment; this may lead to less spending which may reduce demand further. This is called ?
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A. The downward multiplier

B. The upward accelerator

C. The upward PPF

D. The downward mpc

2243. If workers and firms agree on an increase in wages based on their expectations of inflation and inflation turns out to be more than they expected ?
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A. firms will gain at the expense of workers.

B. Workers will gain at the expense of firms

C. neither workers nor firms will gain because the increase in wages in fixed in the labor agreement

D. none of these answers

2244. In a competitive labour market firms will hire labour up to the point where the marginal revenue product of labour equals ?
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A. total labour cost

B. the marginal product

C. the wage rate

D. the price of the product

2245. Supply of land in a given use ?
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A. is perfectly elastic since there is fixed amount of land

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

C. will be upward sloping because as land becomes more valuable in once use, the amount of land made available for that use will increase

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

2246. The natural rate of unemployment is likely to fall if ?
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A. More training is available for the unemployed

B. Geographical immobility increases

C. Income tax increases

D. unemployment benefits increase
2247. The record of countrys transfers of land inter-government payments and money sent by migrants to and from abroad is called its ?
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A. capital account of the balance of payments

B. financial account of the balance of payments

C. balance of payments

D. balance of payments on current account

2248. Permanent income is ?
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A. wages fixed by a union or other labour contract

B. a persons normal or average income

C. none of these answers

D. equal to the minimum wage

E. Social Security income of the elderly and disabled

2249. If British residents want more French francs to purchase more French cloths other things equal, then the equilibrium value of the pound against the French franc will ?
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A. fluctuate

B. not change

C. fall

D. rise

2250. perfect international capital mobility suggests that international funds will be responsive to ________ differentials?
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A. tax

B. current account

C. interest rate

D. price