General Economics Fundamentals MCQs

1. At a given price, the demand for a certain commodity is 1000 units, whereas the quantity supplied is 2000 units. What happens to the price?

2. _____________ is a situation in which different sectors of an economy experience simultaneous and coordinated expansion.

3. The optimum tariff of a country is the highest when the elasticity of the offer curve of the opposite country is:

4. The supply of the capital goods in the economy:

5. An economy in which two distinct economic systems marked by varying levels of technological advancement and development co-exist is known as a:

6. _____________ is a deliberate downward adjustment in the official exchange rates of a country relative to a foreign reference currency.

7. When in an economy, all decisions relating to what goods and services to produce, how to produce, and what quantities to produce are made by a central authority, it is known as:

8. There are _____________ approaches to analyze devaluation.

9. What would be the National Product at market prices for a certain year, if the National Product at factor cost is 4 billion USD, Indirect taxes are $1 billion USD and subsidies are $0.25 billion USD?

10. Fixed and variable costs are distinguished from each other in terms of:

11. If the supply of labour and capital of a country grow in the same proportion as before but the technology remains the same, the production possibility curve of the country would shift outwards:

12. From where does the demand for funds arise according to the loanable fund theory?

13. Indices of the physical volume of production are NOT widely used to measure development because:

14. Isoquant maps _____________:

15. Which of the four equations given below is INCORRECT?

16. Economics can be defined as:

17. _____________ refers to the change in the output of a firm or industry in the long run, when all inputs are increased or decreased simultaneously in the same ratio.

18. Which represent the marginal propensity to import?

19. Why are intermediate goods used to make final goods NOT included in the Net National Product?

20. Per Capita Real Income is calculated by dividing:

21. The main area of application implementation of the Cobb-Douglas production function is:

22. In response to an increase in the demand for its goods, a firm takes a bank overdraft, buys raw materials with the money so raised, and increases production. The firm can be said to have resorted to:

23. Which would you include when calculating the GNP?

24. _______________ is a tariff that maximizes a country's welfare.

25.

The breakdown of the gold standards was the result of which of the following factors?

1. Deflation policies caused considerable difficulties.

2. Some gold standard countries did not obey the gold standard rules.

3. Sterling was over valued.

4. The export of gold became impossible.

26. Which hinder economic development?

27. When the production process is subject to increasing returns to scale, the returns to a variable factor of production:

28. Consider the following information: National Income at current prices for the year Y1 = $30 billion USD National Income at current prices for the year Y2 = $80 billion USD Price Index for Y1 = 150 Price Index for Y2 = 200 What should be the National Income at constant prices for the year Y2?

29. ________________ is a market structure in which many sellers sell differentiated products.

30. The vertical distance between the average total cost curve and the average variable cost curves tends to __________ as the production increases beyond a point.

31. In most developing countries, ________.

32. In many large u.s. cities, taxicab companies operate as near monopolies because of_____.

33. In the _________, the perfectly competitive firm will seek out ________________________ .

34. In the factor market, firms ________ and households ________.

35. Marginal cost is ________ average variable cost when ________.

36. Situational characteristics related to time are known as _____.

37. A flexible exchange rate is one that _______

38. Among the costs of integration for states is __________.