Economics MCQs For Lectureship CSS PMS And NTS Part VI

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Economics MCQs For Lectureship CSS PMS And NTS Part VI

1 What concept did Marshall used in his definition of economics?

Material welfare

2 What is “Wealth of Nations”?

Is a book

3 Can you name the famous book of Alfred Marshall?

Principles of Economics

4 What does Economic Theory means?

Principles of economics

5 What Robbins actually talks about in his definitions?

Scarcity of resources

6 What does Market system means?

Capitalism

7 When was ‘Wealth of Nations’ authored?

1776

8 Utility and usefulness are two

Different concepts

9 Due to which reason the validity of economic theories can never be proved with 100% certainty?

Ceteris Paribus clause

10 When a consumer is in equilibrium?

When marginal utilities are equal

11 The total is decreasing when

Marginal is negative

12 Satisfaction is most closely related to

Utility

13 What does the term marginal in economics actually means?

Additional

14 Why Demand Curve slopes downward?

Beacause of the law of Diminishing Marginal Utility

15 What restricts a consumer’s spending?

Budget constraint

16 The second name of Law of Substitution is

Law of Equi-Marginal Utility

17 The law of Equi-Marginal Utility is a

Law of Consumption of wealth

18 Total Utility increases when

Marginal Utility is positive

19 The basis of law of demand is

Diminishing Marginal Utility

20 Total Utility is maximum when

When Marginal Utility = 0

 

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21 Utility is the quality of a commodity that satisfies a human

Want or Need

22 Why Indifference curves are convex to the origin?

Because the two goods are imperfect substitute

23 A functional relationship is a statement of how

One variable affect another variable

24 If we plot the equation Y = 20 + 3x, its slope is

3 (Three)

25  The relation between price and commodity is shown by

Law of Demand

26 In perfectly inelastic demand quantity demanded is

Unresponsive

27 If a good has more substitutes, other things keeping the same, its price elasticity of demand is

Larger

28 In case of very low elasticity of demand, it means that the commodity is

A necessity

29 In case of perfectly inelastic demand, an increase in price will result an increase in

Total revenue

30 In case of unitary elastic demand, a 25% increase in price will result how much decrease in demand?

25% decrease in quantity demanded

31 In case of a large positive number in cross elasticity of demand the good is believed to be

A substitute

32 In case of  inelastic demand, a change in the price will change the total revenue in

The same direction

33 In case of Giffen goods price and demand are

Positively correlated

34 The elasticity of demand is greater than unity in case of

Durable goods

35 In case of durable goods the elasticity of demand is

More elastic

36 The value of price elasticity of demand for normal goods is always

Negative

37 In case of normal goods, income elasticity is always

Positive

38 What is a Demand?

A Function of Price

39 In case of inelastic demand, price and total revenue move in the

Same direction

40 What is Supply?

An Increasing Function of Price

41 When technology changes, Supply curve will

Shift

42 Does an increase in demand causes an effect on supply curve?

No

43 If price changes by 1% and supply changes by 2% then what is the case of supply?

Elastic

44 Supply curve touches Y axis when elasticity of supply is

Greater than One

45 In which case supply curve is flatter?

Long run

46 Rise in supply is actually when supply of a commodity increases

Without change in price

47 A shift in market supply curve to the right occurs when

A new technique makes it cheaper to produce the good

48 Equilibrium price fall when

Demanded decreases

49  There will be shortage of commodity when prices are

Below equilibrium level

50  Supply decreases and demand increases when equilibrium price rises but

Equilibrium quantity remains unchanged

 

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51 Which is an important idea for predicting economic changes?

Equilibrium

52 The three productive resources are land, labor and

Capital

53 Production is the transformation of resources into

Economic goods and services

54 Output are the economic goods produced by firms

Firms

55 How many factors do we need for the production of goods?

4 (Four)

56 With the increases in production the standard of living of a country

Rises

57 With intensive cultivation, the productivity of a land can be

Increased

58 According to Malthus population increases by which kind of progression?

Geometric

59 Structural Unemployment due to mechanization of

Agriculture

60 The Proportion of population working or looking for work is the labor force

Participation rate

61 Human Capital is the set of skills that workers possess for

Production of goods

62 According to economists the creation of new capital is

Investment

63 A factory is a good example of a

Capital

64 Shareholders are those who invest in

Joint stock companies

65  One of the advantages of Joint Stock Company is

Limited liability

66 A public limited company is run by board of

Directors

67 Negative return in short run means that marginal is

Negative

68 Economies of scale suggests that the firm’s marginal cost curve lies

 Above its average cost curve

69 One factor must be constant in law of

Diminishing return

70 The two kinds of economies of scale are

Internal and external

71 Under perfect competition a firm is

Price taker

72 In case of monopoly Marginal revenue is always

 Less than average revenue

73 In Monopoly, Marginal revenue is always less than price at all levels of

 Output

74 As output increases Marginal Cost curve

First falls and then rises

75 The another name of Average Total Cost is

UnitCost

76 The slope of Total Cost gives an idea about

Marginal Cost

77 Does Total Cost starts from origin?

No

78 Which cost starts from origin? Total Variable Cost

Total Variable Cost

79 Which cost rises continuously?

Total Cost

80 Explicit cost is the cost that a firm incurs for

Purchasing or Hiring Factors

81 The Short run requires that at least one input is

 Constant

82 The long run is a period long enough to allow firms to

 Change plant size and capacity

83  Marginal Cost = Average Cost is the necessary condition for equilibrium position of

A firm

84 Profit is maximum when the distance between Total Revenue and Total Cost is

 Maximum

85 Profit is also maximum when the slope of Total Cost and Total Revenue is

 The same

86 A normal profit is a part of

 Total cost

87 What is Economic profit?

Total revenue minus total cost

88 When a firm earns economic profit?

When total profit exceeds normal profit

89 What is the basic goal of every firm?

To maximize profit

90 When a firm decides to exit the industry?

When price is less than LAC

91 When TC and TR curves are parallel profit is maximum

Maximum

92 The cost curves are same in Monopoly and

Perfect competition

93 Why normal profit is called normal?

Because it is the minimum acceptable profit to the producer

94 The loss that a firm incurs when it shuts temporarily is equal to

Total Fixed Cost

95 Under which competition Average Revenue = Marginal Revenue?

Perfect Competition

96 What is the necessary condition for equilibrium position of a firm?

MC = MR

97 Where LAC is minimum, it is the most efficient scale of

Production of a firm

98 If a firm is not covering its variable cost, the firm should

Shut down

99 Every factor of production gets reward equal to the value of

 Average product

100 In a perfect competition, demand for a factor is its

MRP curve

 

 

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