Economics MCQ Questions and Solutions with Explanations

Economics MCQ Questions and Solutions with Explanations | Commerce

Economics MCQ Questions and answers with easy and logical explanations. Commerce provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. Economics MCQ is important for exams like B.COM, M.COM, BBA, BBM, CA, CS, CMA, CPA, CFA, UPSC, NET, Banking and other commerce department exam. Page-5 section-12

If one perfectly competitive firm increases its level of output, market supply

A) Will increase and market price will fall B) Will increase and market price will rise C) Both supple and market price will remain constant D) Will decrease and market price will rise

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Answer & Solution

Answer: Option C

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An increase in the price of tea from Rs. 40 per pound to Rs. 50 per pound increase the demand for coffee from 500 pounds to 600 pounds. The cross elasticity of demand is

A) $$\frac{1}{2}$$ B) $$\frac{2}{3}$$ C) $$\frac{3}{4}$$ D) $$\frac{4}{5}$$

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Answer & Solution

Answer: Option D

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Which of the following is an implicit cost of production?

A) Wages to the labour B) Rent on building C) Interest on owned money capital D) Payment for machine

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Answer & Solution

Answer: Option C

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Average cost curve falls:

A) When the MC curve is less than AC curve B) When the AC curve is less than MC curve C) When the AC curve is equal to MC curve D) When the MC curve is greater than AC curve

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Answer & Solution

Answer: Option A

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Which one of the following equations is correct?
Where MRP = Marginal Revenue Product
MPP = Marginal Physical Product
MR = Marginal Revenue

A) MRP = MRP × MR B) MRP = MPP × MR C) MPP = MRP + MR D) MRP = MPP + MR

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Answer & Solution

Answer: Option B

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The consumer is 10 equilibrium when he plans his expenditure on x, y, and z commodities in such a way that he ultimately attains

A) MUX = MUY = M2 B) MD1/P1 = MU2/P2 = MU3/P3 C) MUX/PX = MUY/PY = MUZ/PZ = MUM D) None of the above

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Answer & Solution

Answer: Option C

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Which one of the following is not the characteristic of capitalism?

A) Individuals and associations behave with economic motive of maximising their profit with least sacrifice or cost B) The country's major means of production are either owned by the Government or their use is controlled by the Government C) Producers, consumers and employees compete among themselves, as the resources and opportunities are limited D) Price, the invisible hand, plays a predominant role in the flow of the factors of production and consumption

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Answer & Solution

Answer: Option B

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Production function is based on which combination of the main characteristics of the inputs from the following.
1. Substitutability
2. Complementarity
3. Flexibility
4. Specificity
Choose the correct answer

A) Both 1 and 2 B) 1, 3 and 4 C) 1, 2 and 4 D) Both 3 and 1

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Answer & Solution

Answer: Option C

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Equilibrium with excess capacity arises in

A) perfect competition B) cut-throat competition C) monopoly D) monopsony

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Answer & Solution

Answer: Option B

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The major factors affecting demand

A) Utility of the commodity B) Income level C) Price of the commodity D) All of these

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Answer & Solution

Answer: Option D

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