Economics MCQ

Economics MCQ with Solution [ 2022 ]

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Here, we present the MCQ with solution for Economics course for Higher Secondary, Undergraduate and graduate level.

ECONOMICS MULTIPLE CHOICE QUESTION (MCQ)

  1. Which of the following is not concerned with the ‘Problem of Choice’?
    1. Alternative use of resources
    2. Excessive income
    3. Scarce resources
    4. Unlimited wants
  2. Which of the following is a microeconomic variable ?
    1. National Income
    2. Wholesale Price Index
    3. Market Demand
    4. Aggregate Demand
  3. Slope of a Production Curve is ________.
    1. A straight line
    2. Convex to the point of origin ‘O’
    3. Concave to the point of origin ‘O’
    4. None of these
  4. The satisfying power of a commodity is called _________.
    1. Demand
    2. Consumption
    3. Utility
    4. Value
  5. Consuming two goods, the consumer attains equilibrium when ________.
    1. MU1 > MU2
    2. MU1 < MU2
    3. MU1 = MU2
    4. MU1 = TU1 and MU2 = TU2
  6. When marginal utility is negative, total utility is ________.
    1. Zero
    2. Diminishing
    3. Maximum
    4. Minimum
  7. When total utility is maximum, marginal utility becomes _________.
    1. Unity
    2. Negative
    3. Positive
    4. Zero
  8. What will be the condition of total utility when marginal utility stays ________
    1. Maximum
    2. Minimum
    3. Increasing
    4. Diminishing
  9. When Total Utility (TU) is increasing at a diminishing rate, Marginal Utility (MU) must be _________.
    1. Increasing
    2. Decreasing
    3. Constant
    4. Negative
  10. Budget line indicates _________.
    1. Income Ratio
    2. Price Ratio
    3. Cost Ratio
    4. All of the above
  11. An indifference curve is related to _________.
    1. Choices and Preferences of the consumer
    2. Income and Purchasing capacity
    3. Prices of any two goods
    4. Total Utility from any two goods
  12. In case of normal goods, demand curve is_________
    1. A negative slope
    2. A positive slope
    3. Parallel to y-axis
    4. Parallel to x-axis
  13. Law of demand must fall in case of _________.
    1. Normal Goods
    2. Giffen Goods
    3. Inferior Goods
    4. None of these
  14. In the case of Giffen’s Paradox, the slope of demand curve is ________.
    1. Negative
    2. Positive
    3. Parallel to X-axis
    4. Parallel to Y-axis
  15. If two goods are complementary then rise in the price of one results in _______
    1. Rise in demand of the other
    2. Fall in the demand of other
    3. Fall in the price of other
    4. Rise in the demand of both
  16. Per unit production of the variable factor is called _________.
    1. Total product
    2. Average product
    3. Marginal product
    4. None of these
  17. Difference between TR and TC is maximum when _________.
    1. AR = MR
    2. MR = MC
    3. MR = AC
    4. MC = AC
  18. Per unit cost of a good is called _________.
    1. Total Fixed Cost
    2. Variable Cost
    3. Average Cost
    4. None of these
  19. When MR is zero, then __________.
    1. TR is minimum
    2. TR is zero
    3. TR is maximum
    4. TR is equal to MR
  20. When TR increases at a constant rate, MR should be _________.
    1. Increasing
    2. Decreasing
    3. Constant
    4. Zero
  21. The operation of future delivery in the foreign exchange market is known as _______
    1. Forward market
    2. Spot market
    3. Current market
    4. Domestic market
  22. The trade of visible and invisible items is known as _________.
    1. Balance of Payments
    2. Balance of Trade
    3. Deficit of Interest
    4. Profit
  23. Which of the following does not have the application of multipliers ?
    1. Determination of income
    2. Fiscal policy
    3. Monetary policy
    4. Foreign direct Investment
  24. Which of the following is studied under Macroeconomics ?
    1. National Income
    2. Full Employment
    3. Total Production
    4. All of these above
  25. Study of aggregates is known as _________.
    1. Microeconomics
    2. Macroeconomics
    3. Development Economics
    4. Factor of Price aggregation
  26. Economy may be classified as ________
    1. Capitalist
    2. Socialist
    3. Mixed
    4. All of these
  27. Who is known as the ‘Father of Modern Macroeconomics’ ?
    1. Adam Smith
    2. J.M. Keynes
    3. Samuelson
    4. Hicks
  28. The basic factors of production are land, labor, capital and ________.
    1. Enterprise
    2. Investment
    3. Machinery
    4. Resources
  29. Interest rates and bond prices are ________.
    1. Positively related
    2. Negatively related
    3. Not related
    4. Either A or B
  30. When did the great depression occur ?
    1. 1929-30
    2. 1934-35
    3. 1938-39
    4. 1941-42
  31. Who said “Economics is a science of logic”
    1. Hicks
    2. Keynes
    3. Robbins
    4. Marshall
  32. Which of the following is not a feature of Keynesian Theory ?
    1. Short run
    2. Wage price flexibility
    3. Fiscal policy
    4. Underemployment equilibrium
  33. Under Keynesian Theory of Income Determination, investment
    1. Depends on income
    2. Endogenous
    3. Exogenous
    4. Depends on money supply
  34. What is a ‘good’ in economics?
    1. It is a service.
    2. It can be a service.
    3. It is something that appears appealing.
    4. It is something that satisfies wants and needs 
  35. Two sector economy consists of _________.
    1. Households, Firms
    2. Households, Government
    3. Firms, Foreign Sector
    4. Firms, Government
  36. Under Keynesian Theory of Income Distribution, investment is _________.
    1. Depends on Income
    2. Endogenous
    3. Exogenous
    4. Depends on money supply
  37. Under Keynesian Model Aggregate Expenditure is measured along ________.
    1. Vertical axis
    2. Horizontal axis
    3. Vertical Intercept
    4. 450 Line
  38. The demand curve of Oligopoly is _________.
    1. Kinked
    2. Vertical
    3. Horizontal
    4. Left Skewed
  39. A monopolist is a price _________.
    1. Acceptor
    2. Taker
    3. Giver
    4. Maker
  40. The demand curve of a monopoly firm will be _________.
    1. Upward Sloping
    2. Downward Sloping
    3. Horizontal
    4. Vertical
  41. Price Discrimination can take place only in _________.
    1. Perfect Competition
    2. Oligopoly
    3. Monopolistic Competition
    4. Monopoly
  42. The concept of the supply curve is relevant only for ________.
    1. Oligopoly
    2. Monopoly
    3. Monopolistic Competition
    4. Perfect Competition
  43. Invisible hand theory is given by _________.
    1. Lord Robbins
    2. Samuelson
    3. Marshal
    4. Adam Smith
  44. In a free-market economy, the allocation of resources is determined by_________.
    1. Votes taken by consumer
    2. A central planning authority
    3. Government
    4. Consumer Preference
  45. The growth of an economy is indicated by an _________.
    1. Increase in savings
    2. Increase in investment
    3. Increase in general prices
    4. Increase in national income
  46. _________ equals revenue minus all explicit costs.
    1. Accounting Profit
    2. Economic Profit
    3. Normal Profit
    4. Normal Loss
  47. Goods and Services bought and sold in
    1. Product Market
    2. Factor Market
    3. Capital Market
    4. Money Market
  48. In economics, the central problem is _________.
    1. Money
    2. Scarcity
    3. Allocation
    4. Production
  49. Microeconomics is not concerned with the behavior of _________.
    1. Consumers
    2. Aggregate Demand
    3. Firms
    4. Industries
  50. Cars and Petrol are _________ goods.
    1. Substitute
    2. Complementary
    3. Producer
    4. None of the above
  51. Passive Factor of Production is _________.
    1. Only Land
    2. Only Capital
    3. Both Land and Capital
    4. Neither Land nor Capital
  52. Opportunity cost is also known as _________.
    1. Outlay Cost
    2. Sunk Cost
    3. Alternative Cost
    4. Total Cost
  53. The Iso-cost line indicates the price of ________.
    1. Output
    2. Inputs
    3. Finished Goods
    4. Raw Material
  54. _________ is the situation with increased investment and increased price.
    1. Recession
    2. Progress
    3. Boom
    4. Recovery
  55. The concept of product differentiation was introduced by _______.
    1. Rosenstein Roden
    2. JR Hicks
    3. Robinson
    4. Chamberlin
  56. The real business cycle theory is most closely related to ________.
    1. Keynesian Theory
    2. Monetarist Theory
    3. The Classical Theory
    4. New Keynesian Theory
  57. Which one is not an exception to the ‘ Law of Demand’ ?
    1. Normal good
    2. Articles of distinction
    3. Ignorance
    4. Inferior good
  58. In economics, _________means ‘a state of rest’ or ‘stability’.
    1. Depression
    2. Equibilium
    3. Maturity
    4. Growth
  59. Neoclassical definition of Economics is given by _________.
    1. J.B. Say
    2. Lionel Robbins
    3. Adam Smith
    4. Alfred Marshall
  60. When the demand curve is a rectangular hyperbola, it represents _________.
    1. Perfectly Elastic
    2. Highly Elastic
    3. Perfectly Inelastic
    4. Moderately Elastic

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