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-1 section-8

Monopoly is not considered desirable from the point of view of the society mainly because the monopolist endeavours to

A) earn net revenue on sale of all goods including those involving no cost of production B) earn net revenue on sale of goods in short run as well as long run C) charge different prices for the same product from the different categories of buyers D) produce below economic capacity level when he exhibits satisfaction with normal profit only

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Answer & Solution

Answer: Option D

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What happens when the consumer moves away from the origin into a higher indifference curve?

A) The consumer reaches a less preferred combination of goods B) The consumer reaches a more affordable combination of goods C) The consumer reaches a more preferred combination of goods D) None of the above

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Answer: Option C

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Marginal revenue will be zero, if the elasticity of demand is

A) zero B) greater than one C) equal to one D) less than one

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Answer: Option C

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Consider the following statements.
1. The demand for necessities in inelastic.
2. Demand for luxuries is elastic.
3. A product which has several uses has an elastic demand.
Which of the statement(s) given above is/are correct?

A) Only 3 B) Both 2 and 3 C) Both 1 and 2 D) All of the above

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Answer: Option D

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The Normal Demand Line for a good

A) A vertical line B) A lying line C) Climbing upwards D) There is a line falling down

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Answer: Option D

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Bobby buys cat food for his cat, Pearl. If the price of cat food falls (cat food is on the X-axis), then Bobby's budget line will

A) Rotate outward, and its slope will change B) Shift inward, and its slope will not change C) Shift outward, and its slope will not change D) Rotate inward, and its slope will change

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Answer & Solution

Answer: Option A

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Which one of the following statements is true?

A) Pure profit is the return in excess of the opportunity cost B) Accounting profit is the excess of total revenue over and above the explicit and implicit costs C) Profit maximisation is the sole objective of the modern firms D) Profit is maximum when the difference between marginal revenue and marginal cost is maximum

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Answer: Option A

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Mixed economy means-

A) Balance development of agriculture and industrial sector B) Combined development of rural and urban area C) Equal division of wealth between rural and urban poors D) Co-existence of private and public sector

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Answer & Solution

Answer: Option D

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MC curve always cuts the AC curve from below

A) on the falling portion of AC curve B) on the rising portion of AC curve C) at any point on the AC curve D) at the minimum point of the AC curve

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Answer & Solution

Answer: Option D

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Marginal rate of substitution of x and y can be shown in the curve by formula
Economics mcq question image

A) $$MR{S_{xy}} = \frac{{ - \Delta y}}{{\Delta x}}$$ B) $$MR{S_{xy}} = \frac{{\Delta x}}{{\Delta y}}$$ C) $$MR{S_{xy}} = \frac{{\Delta y}}{{\Delta x}}$$ D) $$MR{S_{xy}} = \frac{{ - \Delta x}}{{\Delta y}}$$

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Answer & Solution

Answer: Option A

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