Question # 1

If demand curve is parallel to x-axis, then elasticity of demand is

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Infinite

Zero

Equal to unity

More than unity

If MC=MR=AR=AC=P, then a firms gains:

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Super profit

Normal profit

Normal loss

Abnormal loss

In perfect competition number of firms is

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One

Two

A few

Large

If due to a very slight decrease in price, demand goes on increasing, elasticity of demand will be

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More than unity

Less than unity

Infinite

Zero

During boom

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Business contracts

Unemployment increase

Profit decreases

Profit increases

If the income and expenditures of the government are equal, such budget is called

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Surplus budget

Deficit budget

Balanced budget

Capital budget

Which laws are framed by parliament

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State laws

Moral laws

Economic laws

Scientific laws

The trade transaction between the individuals of different areas of a country is called

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Local trade

Regional trade

Domestic trade

International trade

Which of the following is not invisible trade

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Expenditure on education in other country

Expenditure on imported machinery

Expenditure of passengers traveling by air

Expenditure of goods carried by a ship

Demand for factors of production is

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Direct

Derived

Positive

Negative

The equilibrium of the market is that demand and supply to each other are

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opposite

positive

equal

negative

Other name of law of equi marginal utility is

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Law of diminishing marginal utility

Law of demand

Law of constant return

Law of indifference

If the demand for a commodity is more elastic, then an entrepreneur in order to increase his profit

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Will increase its price

Will decrease its price

Will not change its price

None of these

A monopolistic firm has control of

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Whole market supply by one firm

Whole market supply by two firms

Whole market supply by a few firms

None of these

Feature of a commodity to satisfy human want, is called

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Value

Usefulness

Utility

Wealth

The budget period in public finance is

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six months

one year

two years

five years

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Principles of Economics Icom Part 1 English Medium Online Test MCQs With Answers

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