Question # 1

According to the law of diminishing utility.

Choose an answer

Utility is at a maximum with the first unit

Increasing units of consumption increase the marginal utility

Marginal product will fall as more units are consumed

Total utility will rise at a falling rate as more units are consumed

If a few firms dominate an industry the market is known as.

Choose an answer

Monopolistic competition

Competitively monopolistic

Duopoly

Oligopoly

If demand increase in a market this will usually lead to.

Choose an answer

A higher equilibrium price and output

a lower equilibrium price and higher output

A lower equilibrium price and output.

A higher equilibrium price and lower output

The resources in an economy are

Choose an answer

Constantly increasing

Fixed at any moment

Constant decreasing

Able to be transferred easily between industries

According to schumpater

Choose an answer

Monopolies are inefficient

Monopoly profits act as an incentive for innovation

Monopolies are allocatively efficient

Monopolies are productively efficient

The marginal Revenue product is.

Choose an answer

Upward sloping due to the law of demand

Upward sloping due to the law of marginal utility

Downward sloping due to the law of diminishing returns.

Downward sloping due to the law of supply

A welfare less occurs in monopoly where

Choose an answer

The price in greater than the marginal cost

The price is greater than the marginal benefit

The price is greater than the average revenue

Has the right to investigate monopolies and will assess each one on its own mertis

Supply side policies are most appropriate to cure.

Choose an answer

Involuntary unemployment

Cyclical unemployment

Voluntary unemployment

A fall in aggregate demand

Developing economics usually have

Choose an answer

Low GDP per captia

Low CPI

Large balance of payments surpluses

Large budget surpluses

If the exchange rate is above the equilibrium level.

Choose an answer

There is excess demand and teh exchange rate will fall

There is excess supply and the exchange rate will fall

There is excess demand and the exchange rate will rise

There is excess supply and the exchange rate will rise

If the price elasticity of demand for a product in market A is -0.2 and in market B is -3 a price discriminator will charge.

Choose an answer

The higher price in market A

The higher price in market B

The same price in both markets

There are many sellers

The marginal propensity to consume is equal to.

Choose an answer

Total spending /total consumption

total consumption/total income

Change in consumption/change in income

Change in consumption/change in savings

Horizontal integration may lead to internal economics of scale. Which of the following is not a type of internal economy of scale.

Choose an answer

Purchasing

Technical

Financial

Safety

An increase in costs will

Choose an answer

Shift aggregate demand

Shift aggregate supply

Reduce the natural rate of unemployment

Increases the productivity of employees

An increase in the wage rate.

Choose an answer

Will usually lead to more people employed

Will decrease total earnings if the demand for labour is wage elastic

Is illegal in a free market

Will cause a shift in the demand for labour

If firm earn normal profits.

Choose an answer

They will aim to leave the industry

Other firms will join the industry

The revenue equals total costs

No profit is made in accounting terms

If there is a price floor there will be.

Choose an answer

Shortages

Surpluses

Equilibrium

All of these

An increase in price all other, things unchanged leads to.

Choose an answer

Shift demand outwards

Shift demand inward

A contraction of demand

An extension of demand

Who advocates laissez fair.

Choose an answer

Monetarists

Classical

Neo classical

Modern

Barriers to entry do not include

Choose an answer

Patents

Internal economics of scale

Mobility of resources

High investment costs

All currencies other than the domestic currency of a given country are referred to as.

Choose an answer

Reserve currencies

Neal monies

Foreign exchange

Hard currency

More Classes

Other Links

PPSC Economics Chapter 1 Basic Economics MCQs With Answers

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer