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

Taxes create a wedge between the sales price and purchase price that prevents the price system equaling _________ and

Question # 2

A competitive equilibrium is Pareto efficient because.

Question # 3

If some body is prepared to work at the going wage rate but cannot find work than they are victims of.

Question # 4

The most important source of wage differentiate are.

Question # 5

Moral Hazard means that the act of insuring __________ that the desired outcome will occur.

Question # 6

The extra utility from consuming one more unit of a good is called.

Question # 7

When real income increases, other things equal we fan expect the demand for real money holdings to.

Question # 8

The key issues of macroeconomics are

Question # 9

If demand is _______ then price cuts will ________ spending.

Question # 10

All of the following are parts of the business cycle except.

Question # 11

If goods are exported for less than society's marginal production cost and the marginal benefit to domestic consumers, it is likely that they benefit from.

Question # 12

The opportunity cost of acquiring education is.

Question # 13

If the diagram of a line shows that lower values on the vertical scale are associated with higher values on the horizontal scale this is an example of.

Question # 14

In an economy, measuring total value (1) added, total value(2) spending on final goods and 3 total factor earning gives the result that.

Question # 15

Within circular flow of income, an increase in domestic income iwll lend to increase.

Question # 16

Under floating exchange rates, expectations of higher interest rates are likely to cause an __________ of the exchange rate.

Question # 17

A monopoly may be self perpetuating because profits may be used for

Question # 18

The level of the equilibrium exchange rate offsets international difference in.

Question # 19

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

Question # 20

In an open economy leakages to imports ______ the value of the multiplier.

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Economics
11th Chapter

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Sr.# Question Answer
1 A profit maximizing firm will hire labor until _______ equal the
A. Marginal revenue, marginal cost
B. Long run marginal revenue, long run marginal cost
C. Labour output ratio, capital output ratio
D. Marginal cost of labour, marginal revenue product
2 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
3 The retail price index is used to.
A. Construct price lists
B. Compare shop prices
C. Measure changes in the cost of living
D. None of the above
4 In the classical model, potential output can not be increased by
A. Monetary growth
B. Better technology
C. More capital
D. higher labour supply
5 A monopoly may be self perpetuating because profits may be used for
A. research
B. Cost saving
C. Technical advance
D. All of the above
6 A rise in the real exchange rate will __ the competitiveness of the domestic economy.
A. Increase
B. reduce
C. do nothing do
D. all of these
7 The prisoners Dilemma Game demonstrates that.
A. Players are better off to act independently
B. Monopoly is better than competition
C. People will always cheat
D. Players are better off if they con operate
8 A tariff causes domestic firms to __________ and consumers to
A. Overproduced, under consume
B. overproduce , overconsume
C. Underproduce, under consume
D. underproduce, overconsume
9 Starting from a position of internal and external balance a reduction in aggregate demand will cause a current account.
A. Deficit
B. Surplus
C. Revaluation
D. Devaluation
10 Floating exchange rates are __ in the short run
A. Stable
B. Volatile
C. Predictable
D. Depreciating
11 GDP per head may be an imperfect measure of economic welfare because it excludes.
A. The value of leisure
B. Externalities
C. Untraded goods
D. All of the above
12 Monetarists believe that a reduction in _____ can be achieved by reducing.
A. Unemployment, prices
B. Inflation, wages
C. Unemployment, wages
D. Inflation, the quantity of nominal money
13 In the UK under a _________ of the labour force belong to a trade union.
A. Quarter
B. Third
C. Half
D. Three quarters
14 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
15 Efficiency wages are_______ that raise
A. Low wages , employment
B. High wages, labor supply
C. High wages, productivity
D. High wages, employment
16 The quantity theory of money says that changes in ______ lead to equivalent changes in ______ but have no effect on.
A. Prices, wages, output and employment.
B. Output, prices, employment
C. Nominal money, the price level output and employment.
D. Nominal money output prices
17 Firms are assumed to ____ costs and to _______ profit.
A. Incur , desire
B. Pay ; make
C. Change ;earn
D. Minimize ; maximize
18 Real GNP measures income
A. Including non market activities
B. Adjusted for inflation
C. Including externalities
D. Including tax evasion
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 A market can accuretaly be described as
A. A place to buy things
B. a place to sell things
C. The process by which prices adjust to reconcile the allocation of resources
D. a place where buyers and sellers meet.

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