NAT II Management Science Economy MCQs With Answers

Question # 1

Which of the following is TRUE for a Giffen good?

Choose an answer

Its marginal utility is zero

Its demand curve is perfectly elastic

Its substitution effect is positive

Its demand curve is positively sloped

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Question # 2

A monopolistically competitive firm in short run equilibrium:

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Will make negative profit (lose money).

Will make zero profit (break-even)

Will make positive profit

Any of the given are possible.

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Question # 3

The long run aggregate supply curve will shift to the right if:

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The price level increases.

Factors of production (such as labor and capital) increase

Expenditures (such as consumption and net exports) increase.

The prices of inputs used to produce goods and services (such as wages and the price of oil)descreases

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Question # 4

In the FY 2005-06 the GDP growth rate of Euro area was 1.3 percent, the developing nations 8.6 percent and the world was:

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3.5 percent

4.8 percent

4.5 percent

5.5 percent

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Question # 5

A firm is charging a different price for each unit purchased by a consumer.This is called:

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First-degree price discrimination

Second-degree price discrimination

Third-degree price discrimination

None of the given options

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Question # 6

The interest rate parity is the basic identity that relates which of the following?

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Interest rates and exchange rates

Interest rates and inflation rate

Exchange rates and inflation rate

Discount rate and inflation rate

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