Introduction to Economics mcqs for test preparation of subjects related to studies of economics.
Introduction to Economics MCQs
The sacrifice involved when you choose a particular course of action is called the?
A. Alternative
B. Opportunity cost
C. Consumer cost
D. Producer cost
Human wants are ______?
A. Always fixed
B. Limited
C. Unlimited
D. Likely to decrease over time
Which of the following is not one of the basic economics ?
A. What to produce
B. Who to produce for
C. How to produce
D. How to maximize economic growth
The free market involves ?
A. The free provision of products
B. The Subsidizing of products
C. Market forces of supply and demand
D. All trade via barter
In a command (planned) economy ?
A. The price mechanism
B. Resources are allocated by market forces
C. Individual firms make decisions
D. The public sector is large
Macroeconomics deals with?
A. the behaviour of the electronics industry
B. the behaviour of firms
C. economics aggregates
D. the activities of individual units
The study of inflation is part of ?
A. descriptive economics
B. normative economics
C. macroeconomics.
D. microeconomics
The total demand for goods and services in an economy is known as ____?
A. gross national product.
B. national demand.
C. economy-wide demand
D. aggregate demand
A graph showing all the combinations of goods and services that can be produced if all of society’s resources are used efficiently is a ?
A. capital consumption frontier.
B. Lorenz curve.
C. Circular-flow diagram.
D. Production possibility curve.
The circular flow of goods and incomes shows the relationship between?
A. Wages and salaries.
B. income and money
C. goods and services.
D.firms and households
In a planned or command economy, all the economics decisions are taken by the ?
A. Consumers
B. voters
C. government
D. Workers
Economics is the study of ?
A. how society manages its unlimited resource
B. how society manages its scarce resources
C. how to fully satisfy our unlimited wants
D. how to avoid having to make trade-offs
Raising taxes and increasing welfare payments ?
A. reduces market power
B. Proves that there is such a thing as a free lunch
C. improves efficiency
D. improves equity at the expense of efficiency.
Productivity can be increased by ?
A. improving the education of workers
B. raising union wages.
C. raising minimum wages.
D. restricting trade
The opportunity cost of a good is _____?
A. the time lost in finding it
B. the quantity of other goods sacrificed to get another unit of that good
C. the expenditure on the good
D. the loss of interest in using savings
In a free market?
A. government intervenes
B. government plan production
C. government interferes
D. Prices adjust to reconcile scarcity and desires
Normative economics Forms ________ based on ________?
A. positive statements, facts
B. opinions personal facts
C. positive statements values
D. opinions facts
If marginal benefit is greater than marginal cost, a rational choice involves ?
A. no more of the activity.
B. less of the activity
C. more of the activity
D. more or less, depending on the benefits
The retail price index is used to ______?
A. construct price lists
B. compare shop prices
C. measure changes in the cost of living
D. None of the above
Resources in an economy ?
A. Are always found
B. Can never decease
C. Always increase over time
D. Are limited at any moment in time
The sacrifice involved when you choose a particular course of action is called the ?
A. Alternative
B. Opportunity cost
C. Consumer cost
D. Producer cost
If you income during one year is Rs10,000 and the following year it is Rs12,000 then it has grown by _______?
A. 20%
B. 2%
C. 12%
D. 16%
On a graph, a positive linear relationship ______?
A. moves down to the right
B. moves up to the left
C. moves up to the right
D. moves down to the left
When we know the quantity of a product that buyers wish to purchase at each possible price we know ____?
A. Demand
B. Supply
C. Excess demand
D. Excess supply
The equilibrium price clears the market it is the price at which ____?
A. Everything is sold
B. Quantity demanded equal quality supplied
C. Excess demanded equals quantity
D. B and C
A demand curve can shift because changing ?
A. incomes
B. prices of related goods
C. tastes
D. all of the above
If a price increase of good A increases the quantity demanded of good B, then good B is a ____?
A. substitute good
B. complementary good
C. bargain
D. inferior good
An increase in consumer income will increase demand for a _________ but decrease demand for a?
A. substitute good, inferior good
B. normal good inferior good
C. inferior good normal good
D. normal good, complementary good
The basic economic problems will not be solved by ?
A. Market forces
B. Government intervention
C. A mixture of government
D. The creation of unlimited resources
A mixed economy ?
A. Has supply but not demand
B. Has demand but not supply
C. Has supply and demand
D. Has market forces and government intervention
The public sector includes ?
A. Investors owning companies
B. Government ownership of assets
C. Market forces of supply and demand
D. All trade via barter
The economics the central problem is ?
A. Scarcity
B. Money
C. Consumption
D. Allocation
Microeconomics is not concerned with the behavior of ?
A. aggregate demand
B. firms
C. Consumers
D. industries.
Aggregate supply is the total amount ?
A. of labor supplied by all households
B. Produced by the government
C. of goods and services produced in an economy.
D. of products produced by an industry
Inflation is ___?
A. a decrease in the overall price level
B. an increase in the overall price level
C. an increase in the overall economics
D. a decrease in the overall level of economics
A student chooses to study because the marginal benefit is greater than the ____ cost?
A. average
B. expected
C. total
D. marginal
In a free market system, the amount of goods and services that any one household gets depends upon its ?
A. income
B. income and wealth
C. wealth
D. wage and interest income
Trade-offs are required because wants are unlimited, and resources are ?
A. economical
B. unlimited
C. Efficient
D. Scarce
A rational person does not act unless ?
A. the action is ethical
B. The action produces marginal costs
C. The action produces marginal benefits that exceed marginal costs.
D. The action makes money for the person
Which of the following products would be least capable of producing an externality ?
A. inoculations against disease
B. cigarettes
C. food
D. education
E. stereo equipment
High and persistent inflation is caused by ?
A. unions increasing wages too much
B. OPEC raising the price of oil too much
C. governments increasing the quantity of money
D. regulations raising the cost of production
Economics is the study of ?
A. Production technology
B. Consumption decisions
C. how society decides what how and for whom to produce
D. the best way to run society
A market can accurately be described as ______?
A. a place to buy things
B. a place to sell things
C. the process by which prices adjust to reconcile the allocation of resources
D. a place where buyers and sellers meet
In the mixed economy _______?
A. economics problems are solved by the government and market
B. economic decisions are made by the private sector
C. economic allocation is achieved by the invisible hand
D. economics s is solved by government
Macroeconomics is the study of ?
A. individual building blocks in the economy
B. the relationship between different sectors
C. household purchase decisions
D. The economy as a whole
Time series data show information ?
A. about the same point in time
B. about different points in time over the same variable
C. about different variables o
D. about different points in time
A real value can be derived from a nominal value by ?
A. adjusting for changes over time
B. adjusting for data collection errors
C. adjusting for population changes
D. adjusting or changes in prices
A straight-line diagram can be drawn knowing the _____ and _____?
A. vertical axis and horizontal axis
B. intercept and slope
C. scale and slope
D. intercept and scale
If the diagram of a line shows that lower values on the vertical scale are associated with higher values on the horizontal scale this is an example of ?
A. a nonlinear relationship
B. a positive linear relationship
C. a scatter diagrams
D. a negative linear relationship
when a market is in equilibrium ?
A. quantity demanded equals quantity
B. Excess demand and excess supply are zero
C. The market is cleared by the equilibrium
D. All of the above
A supply curve is directly affected by ?
A. technology
B. input costs
C. government regulation
D. all of the above
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