PPSC Economics Chapter 11 Assess Your Basics With Answers

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PPSC Economics Chapter 11 Assess Your Basics

Sr. # Questions Answers Choice
1 If the consumption of a good by one person does not reduce the quantity available by other and nobody cna be easily excluded from consumption, we are referring to a. Private good Merit good Public good Abundant good
2 A good example of a public good is. Public transport National defense The national health service Rail transport
3 Market some times fall to exist because of. Externalities the free rider problem Poor transport a an b
4 Market failure may arise because of. Imperfect competition Taxation Externalities All of the above
5 Extremality's arise because there is a divergence between ____ and _ Private costs, private benefits Private costs, social costs of benefits Social cost, social benefit Insiders, outsiders
6 If my neighbor burns garden waste causing my house to fil with smoke this is an example of. A production extremality A second best solution Transaction costs A consumption externality
7 The allocation of resources is not efficient it The marginal cost of production does not equal society marginal benefit The distribution is inequitable Economic growth is low Unemployment is high
8 A competitive equilibrium is Pareto efficient because. Producers are price takers Consumers and producer's face the same prices Marginal costs and benefits are equal All of the above
9 We cannot say whether one allocation of resources is better than another allocation because. some people cant count Some people may not be permanent residents Not all economic activity is legal We cant make value judgements to compare different people welfare.
10 An allocation is Pareto efficient if no reallocation of resources would make some people_______ whiteout making others Worse off, worse off better off, better off better off, worse off equal , unequal
11 Moral Hazard means that the act of insuring __________ that the desired outcome will occur. Reduces the likelihood Increase the likelihood Guarantees None of the above
12 Land will be allocated between competing uses so that. Housing gets priority Industry gets priority Faming gets priority The equilibrium rental rate equilibrium total demand with supply
13 In the short run, the supply of capital is _______ and in the long run iwll depend on. Variable technology Fixed, expectations Fixed, rental rate of capital Variable, interest rates.
14 The value of an asset depends upon Its scrap value Its depreciation The present value of the failure stream of income it can earn. the cost of loans
15 The cost of using capital services is the wage rate of capital Interest charges Marginal capital cost Rental rate for capital
16 Efficiency wages are_______ that raise Low wages , employment High wages, labor supply High wages, productivity High wages, employment
17 In the UK in recent years, union membership has ______ and days of work lost because of strikes has. Grown, declined declined, declined declined, grown grown , grown
18 Women and non whiles on average receive lower comes than white men because. They tend to work in relatively unskilled jobs Educational disadvantage Firms are reluctant to invest in training All of the above
19 In the UK under a _________ of the labour force belong to a trade union. Quarter Third Half Three quarters
20 By restricting labour supply a trade union can _________ and_______ Increase the wage, increase employment Maintain the wage, increase employment Increase the wage lower employment Maintain the wage, lower employment
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