PPSC Economics Chapter 2 Micro Economics With Answers

PPSC Economics Chapter 2 Micro Economics

Sr. # Questions Answers Choice
1 The quantity of Y demanded increases by 6% when income changes, and income elasticity of demand is -0.9 income Decreased by 5.4 % Decreases by 8% Increased by 15% Decreased by 6.7 %
2 Firm A's margin of safety is. 0.10 0.40 0.20 0.30
3 Firm A's annual profit is. Rs.10,000 Rs.20,000 Rs.30,000 Rs.60,000
4 A firm A's break even quantity is. 10 units 40 units 50 units 30 units
5 When the marginal physical product of labor is 800 - 2N , the price of goods is Rs. 2, and the cost of labor is Rs. 4 per unit, the quantity of labor employed is. 20 Units 800 Units 399 Units 80 units
6 Projects A,B,C,D,E cost Rs. 100, Rs, 200, Rs. 300, Rs. 400, and Rs. 500 with MEC's of 0.07, 0.06,0.09 ,0.10 and 0.11 respectively. The market rate of interest is 8% Total investment spending is Rs. 1500 Rs.1300 Rs.1200 Rs.300
7 The expected profit from the profit distribution above is. 40 units 60 units 100 units 20 units
8 If the estimated values of Y and Py in 1987 are Rs. 20,000 and Rs. 6 respectively, what is the maximum price of X. Rs.420 Rs.240 Rs.300 Rs.360
9 If the estimated values of Y and Py in 1987 are Rs. 30,000 and Rs. 8 respectively the marginal revenue of X is. 260 - 160 x 420 - 4Qx 240 - 16 Px 80 - 4Qx
10 Company A estimates the price elasticity of demand for its products.3.0 The price of the product is Rs. 15. If MC = 2+40, the profit maximizing level of output. 4 units 2 umits 5 units 3 units
11 If there is no price surprise, total output is. 50 150 400 200
12 The short term interest rates on bonds over the next 5 years is 6% , 7%, 9% ,10% and 8% according to the expectations Hypothesis, the interest rates on bonds with 5 years to maturity will be. 6% 8% 10% 9%
13 If a price floor of Rs.15 is imposed, the governments cost is. Rs.150 Rs.300 Rs.750 Rs.450
14 Which of the following is correct for the demand and supply schedules given above. The demand curve is non linear The slope of the supply curve is 4 Equilibrium quantity is 40 units The slope of the demand curve is 0.5
15 Which of the following is correct with respect to the Paasche index. The consumer Price index is an example of the Paasche index. The Paasche index is biased upward The Passche index always exceeds 1 The Paasche index uses given period quantities
16 Assume a cosumer buys 25 units of good X at Rs.8 and 10 units of good Y at Rs. 6 in 1980. If Px = Rs. 6 and Py = Rs. 4 in 1970 the pasasche index is. 1.14 1.65 1.37 1.47
17 The monopolization of the competitive market results in a deadweight loss to society of RSJK JKL THJ RSJL
18 The arc income elasticity of demand is approximately 0.02 1.9 3.3 0.5
19 The are price elasticity of demand is approximately 0.3 3.3 6.0 0.2
20 Under perfect competition, the price system automatically result in efficient output selection when MC = MR MC = MU P = ATC P > AVC
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