PPSC Economics Topic 11 MCQS Test Preparation

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MCQ's Test For PPSC Economics Topic 11 Assess Your Basics

Try The MCQ's Test For PPSC Economics Topic 11 Assess Your Basics

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PPSC Economics Topic 11 Assess Your Basics

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Question # 1

The multiplier accelerator model assumes _______ depends on.

Question # 2

The theory that explains business cycles by the dynamic interaction of consumption and investment demand is the.

Question # 3

All of the following are benefits of the single market except.

Question # 4

Extremality's arise because there is a divergence between ____ and _

Question # 5

If the central bank buys financial securities in the open market to increase the monetary base, this is an example of.

Question # 6

The abolition of income tax would probably ________ the number of workers in employment and____________ the equilibrium. rate of unemployment.

Question # 7

import substitution is the replacement of ________ by domestic production under the protection of.

Question # 8

During periods of rising inflation and rising interest rates we expect the demand for real cash to.

Question # 9

If the MPC is 0.5 the multiplier is

Question # 10

If my neighbor burns garden waste causing my house to fil with smoke this is an example of.

Question # 11

All of the following represent obstacles to LDC development except.

Question # 12

A competitive equilibrium is Pareto efficient because.

Question # 13

Starting from a balanced budget, for a given tax rate an increase in income will cause the government budget to.

Question # 14

The multiplier tells us how much __________ chagnes after a shift in.

Question # 15

If a person thinks they are better off after a 10% wage increase, and all prices have risen 10%, then they are experiencing.

Question # 16

If as result of householder wish to save more there is a change in equilibrium income and no change in equilibrium saving this as an example of.

Question # 17

In the economy when a steel producer sells steel to car producer it is regarded as.

Question # 18

The effect of a tax to offset a negative eternality will be to ________ price and ____ quantity.

Question # 19

If two firms doing the same thing in the same industry join together this is known as a.

Question # 20

The opportunity cost of a good is.

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Economics
11th Chapter

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Sr.# Question Answer
1 The long run Philips curve is _________ at the ______
A. Horizontal natural rate of inflation
B. Horizontal , natural rate of unemployment
C. Vertical , natural rte of inflation
D. Vertical , equilibrium rate of unemployment.
2 Perfect price discrimination means that every customer.
A. Buys the same amount
B. Pays the same price
C. Pays what she thinks the product is worth
D. Contributes the same revenue.
3 The allocation of resources is not efficient it
A. The marginal cost of production does not equal society marginal benefit
B. The distribution is inequitable
C. Economic growth is low
D. Unemployment is high
4 A fixed exchange rate, plus perfect capital mobility _______ the scope for monetary policy.
A. Enhances
B. Undermines
C. Encourages
D. Facilitates
5 The level of the equilibrium exchange rate offsets international difference in.
A. Comparative advantage
B. Absolute advantage
C. Opportunity cost
D. Relative costs
6 In the event of an increase in the international price of oil that encouraged the central bank to accept lower real interest rates, inflation would most likely.
A. Fall
B. Increases
C. Remain the same
D. Fluctuate
7 Macro economics is the study of.
A. Individual building blocks in the economy
B. The relationship between different sectors of the economy
C. Household purchased decisions
D. The economy as a whole
8 One of the transmission mechanism of monetary policy is through consumer house hold wealth.___________ and consumption.
A. rise, increases, increases
B. rise, falls, increases
C. rise, increases, falls
D. rise, falls, falls
9 If as result of householder wish to save more there is a change in equilibrium income and no change in equilibrium saving this as an example of.
A. Market imperfection
B. The law of diminishing returns
C. The paradox of thriff
D. Market failure
10 The real value can be derived from a nominal value by
A. Adjusting changes over time
B. Adjusting for data collection errors
C. Adjusting for population changes
D. Adjusting for changes in prices
11 An upward shift in marginal cost ___________ output and an upward shift in _____ marginal revenue __ output.
A. Reduce , reduce
B. Reduce , increase
C. Increased, increased
D. Increases, reduces
12 Except for taxes to offset ___ taxes are.
A. Imperfect competition , popular
B. Extremality's, distortionary
C. Inequality, a first best option
D. Poor health, unnecessary
13 The business cycle is not transmitted from one country to another through.
A. Private sector imports and exports
B. Economic policy
C. The duration of compulsory education
D. Labour supply changes
14 Fiscal policy is weak under floating exchange rates as fiscal expansion.
A. Crowds out imports
B. Crowds out public consumption
C. Crowds out exports
D. Reduces the budget deficit
15 If a firm not operating at the output necessary to achieve al scale economies it has not achieved its.
A. Efficient scale
B. Average efficient scale
C. Maximum efficient scale
D. Minimum efficient scale
16 If a long average cost rises, output rises from left to right this is an example of.
A. Increasing returns to scale
B. Decreasing returns to scale.
C. Constant returns to scale
D. the minimum efficient scale
17 A supply curve is directly affected by
A. Technology
B. Input costs
C.
Government regulation
D. All of the above
18 Economics assumes that people consume goods and services to achieve.
A. Status
B. Prestige
C. Utility
D. Self esteem
19 In Nash equilibrium each player chooses the best strategy.
A. Assuming other players move first.
B. Dominated by the other players
C. Given the strategies of other players
D. That is a credible threat
20 Economic transition involves high inflation because ______ and _____
A. High monetary growth, high wages.
B. High budget deficits, devaluation
C. High monetary growth, devaluation
D. Prices surge from an artificially low level to their equilibrium level the inflation tax is required as source of government revenue.

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