Economics MCQ Questions and Solutions with Explanations

Section 1 Section 2 Section 3 Section 4 Section 5 Section 6 Section 7 Section 8 Section 9 Section 10 Section 11 Section 12 Section 13 Section 14 Section 15 Section 16

1.
Rent is the-

A. creation of value and not of wealth

B. creation of wealth and not of value

C. reward to capitalists and cannot earned by labour

D. earned income which accrues because property was built with labour

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2.
According to the classical theory of employment, deviations from the state of full employment are of

A. Permanent nature

B. Purely temporary

C. Imaginary situations

D. Normal situations

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3.
The theory of revealed preference was propounded by?

A. A. Marshall

B. P. F. Drucker

C. Paul Samuelson

D. R. Hicki

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4.
The ordinal utility analys is of consumer behaviour is considered superior to the cardinal utility analysis mainly due to the

A. Assumption of the rationality of consumer behaviour

B. Possibility of the derivation of consumer demand

C. Bifurcation of price effects into income and substitution effects

D. Consideration of the available limited resources for satisfying consumer demand

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5.
In measuring price-elasticity

A. price is a dependent variable and quantity is an independent variable

B. price is an independent variable and quantity is a dependent variable

C. price and quantity both are independent variables

D. price and quantity both are dependent variables

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6.
Match the following:

List-I List-II

a. For a given 10% change in price, demand changes by 0% 1. e > 1

b. For a given 10% change in price, demand changes by 5% 2. e = 1

c. For a given 10% change in price demand changes by 10% 3. e < 1

d. For a given 10% change in price, demand changes by 20% 4. e = 0

A. a-3, b-1, c-2, d-4

B. a-4, b-3, c-2, d-1

C. a-1, b-2, c-3, d-4

D. a-2, b-3, c-1, d-4

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7.
"Buyers are less price sensitive when they cannot easily compare the quality substitutes". Which of the following factors of price sensitivity is reflected from this statement?

A. Substitute - awareness effect

B. Unique value effect

C. Price quality effect

D. None of the above

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8.
When the firm has an incentive to exit a competitive, the exit will

A. Drive down market prices

B. Drive down the profits of existing firms in the market

C. Decrease the number of goods supplied in the market

D. All of the above

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9.
In monopolistic competition of firm remains in equilibrium in the long run

A. At the lowest point of the long run average cost curve

B. In the descending segment of the long run average cost curve

C. In rising segment of the long run average cost curve

D. When price is equal to marginal cost

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10.
Match the items of List-I with items of List-II and choose the correct answer.

List-I List-II

a. Income elasticity less than unity 1. Competitive goods

b. Cross elasticity less than unity 2. Inferior goods

c. Cross elasticity less than zero 3. Superior goods

d. Income elasticity less than zero 4. Complementary goods

A. a-1, b-2, c-3, d-4

B. a-4, b-3, c-1, d-2

C. a-3, b-1, c-4, d-2

D. a-4, b-1, c-2, d-3

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1 2 3 4 5 6 7 8 9 10

List-I	List-II
a. For a given 10% change in price, demand changes by 0%	1. e > 1
b. For a given 10% change in price, demand changes by 5%	2. e = 1
c. For a given 10% change in price demand changes by 10%	3. e < 1
d. For a given 10% change in price, demand changes by 20%	4. e = 0

List-I	List-II
a. Income elasticity less than unity	1. Competitive goods
b. Cross elasticity less than unity	2. Inferior goods
c. Cross elasticity less than zero	3. Superior goods
d. Income elasticity less than zero	4. Complementary goods

Economics MCQ Questions and Solutions with Explanations | Commerce

1. Rent is the-

Answer & Solution

2. According to the classical theory of employment, deviations from the state of full employment are of

Answer & Solution

3. The theory of revealed preference was propounded by?

Answer & Solution

4. The ordinal utility analys is of consumer behaviour is considered superior to the cardinal utility analysis mainly due to the

Answer & Solution

5. In measuring price-elasticity

Answer & Solution

Answer & Solution

7. "Buyers are less price sensitive when they cannot easily compare the quality substitutes". Which of the following factors of price sensitivity is reflected from this statement?

Answer & Solution

8. When the firm has an incentive to exit a competitive, the exit will

Answer & Solution

9. In monopolistic competition of firm remains in equilibrium in the long run

Answer & Solution

Answer & Solution

Read More Section(Economics)

1.
Rent is the-

2.
According to the classical theory of employment, deviations from the state of full employment are of

3.
The theory of revealed preference was propounded by?

4.
The ordinal utility analys is of consumer behaviour is considered superior to the cardinal utility analysis mainly due to the

5.
In measuring price-elasticity

7.
"Buyers are less price sensitive when they cannot easily compare the quality substitutes". Which of the following factors of price sensitivity is reflected from this statement?

8.
When the firm has an incentive to exit a competitive, the exit will

9.
In monopolistic competition of firm remains in equilibrium in the long run