economics MCQs – Page 455

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 Review each marked answer and report any item that may be outdated or unclear.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

9081. The functional distribution of income shows how national income is divided between ?
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A. the population

B. the working population

C. the factors of production

D. employees

9082. The substitution effect of a rise in the price of labour will ____ the quantity of labour and the output, effect will ____ it
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A. increase; increase

B. increase; reduce

C. reduce; increase

D. reduce; reduce

9083. Central banks in LDCs generally have less effect on expenditure and output than in LDCs because of ?
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A. the relative insensitivity of investment and employment to monetary policies

B. #NAME?

C. a poorly developed securities market

D. an externally dependent banking system

9084. _______ states that as real GNP per capita rises, people demand relatively more social goods and relatively fewer private goods?
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A. incomes policy

B. Moral hazard

C. Wagners law

D. Fiscal policy

9085. Which of the following are costs of inflation ?
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A. inflation distorts business behavior especially investment behavior

B. Inflation imposes a tax on the holders of money

C. inflation weakens the creation of credit and capital markets

D. #NAME?

9086. Under financial repression ?
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A. #NAME?

B. banks face pressure for loans to those with political connections

C. banks depend on foreign banks to set interest rates

D. banks engage in non-price rationing of loans

9087. Which of the following is NOT true ?
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A. several LDCs have used value-added taxes to raise a substantial fraction of revenues

B. import duties can restrict luxury goods consumption

C. Taxes on international trade are the major source of tax revenue for low-income countries with poor administrative capacity

D. Cascade tax a form of progressive tax, is dominant in DCs

9088. By using fiscal policy, i (e) varying ______ and/or _____ governments achieve goals for output and employment growth as well as price stability?
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A. tax rates, government spending

B. interest rates, financial liberalization

C. interest rates, tax rates

D. demand pull inflation tax elasticity

9089. When the financial system lacks the capability of making judgement about investment opportunities due to asymmetric information leading to potentially bad credit risks lending is subject to ?
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A. social goods

B. adverse selection

C. moral hazard

D. hyperinflation

9090. The property tax wealth tax inheritance tax and income taxes such as persona and corporate taxes are ?
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A. indirect taxes

B. inelastic

C. direct taxes

D. value-added tax

9091. Monetary policy effects the _________ and __________?
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A. stock price, minimum wage

B. taxes, exchange rate

C. money supply, interest rate

D. reserve, unemployment

9092. With _______ prices rise in the first sector, remain the same in the second and increase overall?
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A. import substitution

B. inflationary expectations

C. ratchet inflation

D. demand pull inflation

9093. Inflation is measured by the ?
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A. #NAME?

B. depreciation

C. consumer price index (CPI)

D. GDP deflator

9094. fiscal incentives to attract businesses from abroad include ?
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A. lower tax rates for reinvested business profits

B. accelerated depreciation

C. #NAME?

D. tax holidays

9095. If people with higher incomes pay a higher percentage of income in taxes, the income tax structure is ?
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A. value added taxes (VAT)

B. excise taxes

C. progressive

D. regressive

9096. The Bank of England and the Federal Reserve ?
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A. loan money to most of LDC commercial banks

B. are central banks

C. use fiscal policy to influence GDP

D. are branches of commercial banks

9097. During Stagflation ?
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A. an increase in aggregate spending will eliminate the recession

B. #NAME?

C. the central bank decease money supply to reduce inflation

D. a decrease in aggregate spending will reduce inflation

9098. Demand pull inflation result from ?
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A. demand for government spending on public goods goes due to lack of financial backup through tax collection

B. a shortage of demand for goods and services in excess of supply during depression

C. consumer business and government demand for goods and services in excess of an economys capacity to produce

D. demand for public goods is greater than demand for consumer goods

9099. An increase in the budget surplus ?
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A. Shift the supply of loanable funds to the right and reduces the real interest rate.

B. Shifts the demand for loanable funds to the right and increases the real interest rate.

C. Shifts the demand for loanable funds to the left and reduces the real interest rate

D. Shifts the supply of loanable funds to the left and increase the real interest rate

9100. An increase in the budget deficit will ?
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A. lower the real interest rate and decrease the quantity of loanable funds demanded for investment

B. raise the real interest rate and increase the quantity of loandable funds demanded for investment

C. raise the real interest rate and decrease the quantity of loanable funds demanded for investment

D. lower the real interest rate and increase the quantity of loaable funds demanded for investment

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