MCQOPTIONS
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MCQOPTIONS
This section includes 179 Mcqs, each offering curated multiple-choice questions to sharpen your Economics (CBCS) knowledge and support exam preparation. Choose a topic below to get started.
| 1. |
In economics capital refers to: |
| A. | Money |
| B. | High quality goods |
| C. | Trade mark |
| D. | Machinery and factories |
| Answer» E. | |
| 2. |
This is capital: |
| A. | Money |
| B. | Forests |
| C. | Machinery |
| D. | Trademarks |
| Answer» D. Trademarks | |
| 3. |
Of real wages and money wages |
| A. | The former is a wider concept than the latter |
| B. | The latter is a wider concept than the former |
| C. | Both concept mean the same thing |
| D. | All of the above |
| Answer» B. The latter is a wider concept than the former | |
| 4. |
The concept of Quasi-rent mean |
| A. | The rent to the workers |
| B. | The rent shared by the Landlord and workers |
| C. | The interest paid to the entrepreneur |
| D. | The return to a factor of production which is fixed in supply in the short period |
| Answer» E. | |
| 5. |
The return to a factor of production which is fixed in supply in the short period is called |
| A. | Scarcity rent |
| B. | Economic rent |
| C. | Quasi-rent |
| D. | Contractual rent |
| Answer» D. Contractual rent | |
| 6. |
According to Prof Knight, profit is the reward for |
| A. | Innovation |
| B. | Capital |
| C. | Foreseeable risks |
| D. | Uncertainty bearing |
| Answer» E. | |
| 7. |
The marginal productivity theory of distribution was firstly formulated in its complete form by |
| A. | Adam Smith |
| B. | J. S. Mill |
| C. | J. B. Clark |
| D. | David Ricardo |
| Answer» D. David Ricardo | |
| 8. |
The iron law of wages is |
| A. | The wage-fund theory |
| B. | The marginal productivity theory of wages |
| C. | Collective bargaining |
| D. | The subsistence theory of wages |
| Answer» E. | |
| 9. |
The uncertainty-bearing theory of profit was propounded by |
| A. | F. H. Knight |
| B. | F. B. Hawley |
| C. | P. A. Samuelson |
| D. | Joseph Schumpeter |
| Answer» B. F. B. Hawley | |
| 10. |
Which of the following is not included in the assumptions of Clark s marginal productivity of distribution |
| A. | Perfect competition |
| B. | Constant population |
| C. | Constant amount of capital |
| D. | Labour is heterogeneous |
| Answer» E. | |
| 11. |
Marginal productivity theory is also called |
| A. | Real theory |
| B. | Classical theory |
| C. | Monetary theory |
| D. | None of the above |
| Answer» B. Classical theory | |
| 12. |
Profit is also known as |
| A. | Contractual rent |
| B. | Residual income |
| C. | Net income |
| D. | None of the above |
| Answer» C. Net income | |
| 13. |
Subsistence theory of wages was used by |
| A. | Karl Marx |
| B. | Robinson |
| C. | J. S. Mill |
| D. | David Ricardo |
| Answer» E. | |
| 14. |
Changes in the rate of interest affect the amount of money held for |
| A. | transaction motive |
| B. | precautionary motive |
| C. | speculative motive |
| D. | normal motive |
| Answer» D. normal motive | |
| 15. |
The marginal productivity theory of distribution is associated with |
| A. | Adam Smith |
| B. | Lionel Robbins |
| C. | J. B. Clark |
| D. | Bergson |
| Answer» D. Bergson | |
| 16. |
Who has contributed the modem theory of interest rate determination? |
| A. | Paul A. Samuelson |
| B. | Gunnar Myrdal |
| C. | Knut Wicksell |
| D. | J.R. Hicks |
| Answer» E. | |
| 17. |
Whose name is associated with the Uncertainty-bearing theory of profit ? |
| A. | J. Schumpeter |
| B. | F.H. Knight |
| C. | J.B. Clark |
| D. | F.W. Watker |
| Answer» C. J.B. Clark | |
| 18. |
Which among the following is NOT an assumption of Pareto optimality? |
| A. | Every consumer wishes to maximize his level of satisfaction. |
| B. | All the factors of production are used in the production of every commodity. |
| C. | Conditions of perfect competition exist making all the factors of production perfectly mobile |
| D. | The concept of utility is cardinal and cardinal utility function of every consumer is given. |
| Answer» E. | |
| 19. |
Who has sought to measure Consumer s Surplus with the help of indifference curve technique? |
| A. | Edgeworth |
| B. | Alfred Marshall |
| C. | J.R. Hick |
| D. | Pareto |
| Answer» D. Pareto | |
| 20. |
When a firm s average revenue is equal to its average cost, it gets ________. |
| A. | Sub normal profit |
| B. | Normal profit |
| C. | Abnormal profit |
| D. | Super profit |
| Answer» C. Abnormal profit | |
| 21. |
Given the price, if the cost of production increases because of higher price of raw materials, the supply |
| A. | Decrease |
| B. | Increase |
| C. | Remains the same |
| D. | Any of the above |
| Answer» B. Increase | |
| 22. |
Under __________________, price is determined by the interaction of total demand and total supply in the market. |
| A. | Perfect competition |
| B. | Monopoly |
| C. | Imperfect competition |
| D. | Monopolistic Competition |
| Answer» B. Monopoly | |
| 23. |
Standard of living of workers depends upon their |
| A. | Nominal wages |
| B. | Real wages |
| C. | Average product |
| D. | Govt. policy |
| Answer» C. Average product | |
| 24. |
The economist Ricardo argued that prices were _____ because land rents were _______ |
| A. | High, High |
| B. | Low, Low |
| C. | Low, High |
| D. | High, Low |
| Answer» E. | |
| 25. |
Under Marginal productivity Theory, reward for labour is determined by |
| A. | Owner |
| B. | Labour |
| C. | Government |
| D. | Marginal Product |
| Answer» E. | |
| 26. |
He presented a theory of rent |
| A. | Malthus |
| B. | Prof. Knight |
| C. | Ricardo |
| D. | Marshall |
| Answer» D. Marshall | |
| 27. |
Monopsony means |
| A. | A single seller |
| B. | A single buyer |
| C. | Large number of buyers |
| D. | None of the above |
| Answer» C. Large number of buyers | |
| 28. |
On which law of consumption the concept of consumer s surplus is based? |
| A. | Engel s law |
| B. | Law of demand |
| C. | First law of Gossen |
| D. | Second law of Gossen |
| Answer» D. Second law of Gossen | |
| 29. |
If equilibrium price rises but equilibrium quantity remains unchanged, the cause is: |
| A. | Supply and demand both decrease equally |
| B. | Supply and demand both increase equally |
| C. | Supply decreases and demand increases |
| D. | Supply increases and demand decreases |
| Answer» D. Supply increases and demand decreases | |
| 30. |
A decrease in demand causes the equilibrium price to: |
| A. | Rise |
| B. | Fall |
| C. | Remain constant |
| D. | Indeterminate |
| Answer» C. Remain constant | |
| 31. |
Price of a product is determined in a free market: |
| A. | By demand for the product |
| B. | By supply of the product |
| C. | By both demand and supply |
| D. | By the government |
| Answer» D. By the government | |
| 32. |
In market equilibrium, supply is vertical line. The downward sloping demand curve shifts to the rights. Then, |
| A. | Price will rise |
| B. | Quantity rises |
| C. | Price remains same |
| D. | Price will fall |
| Answer» B. Quantity rises | |
| 33. |
A rise in supply and demand in equal proportion will result in: |
| A. | Increase in equilibrium price and decrease in equilibrium quantity |
| B. | Decrease in equilibrium price and increase in equilibrium quantity |
| C. | No change in equilibrium price and increase in equilibrium quantity |
| D. | Increase in equilibrium price and no change in equilibrium quantity |
| Answer» D. Increase in equilibrium price and no change in equilibrium quantity | |
| 34. |
Every factor of production gets reward equal to: |
| A. | Value of average product |
| B. | Value of marginal product |
| C. | Value of total product |
| D. | Total revenue |
| Answer» C. Value of total product | |
| 35. |
If MRP = Price of the factor: firm should _______ at the unit of factor |
| A. | less factors |
| B. | more factors |
| C. | stop hiring more |
| D. | All of the above |
| Answer» D. All of the above | |
| 36. |
Under perfect competition, demand for a factor is its: |
| A. | MRP curve |
| B. | ARP curve |
| C. | TRP curve |
| D. | TR TC |
| Answer» B. ARP curve | |
| 37. |
We should employ units of a factor to a point where: |
| A. | MR is negative |
| B. | MP is equal to price of the factor |
| C. | MP is positive |
| D. | MP is rising |
| Answer» C. MP is positive | |
| 38. |
If marginal product of labour rises because of new technology: |
| A. | Wages will rise |
| B. | Wages will fall |
| C. | Wages will be unaffected |
| D. | May rise or fall |
| Answer» B. Wages will fall | |
| 39. |
Increasing the minimum wage for workers will: |
| A. | Sole the unemployment problem |
| B. | Result in scarcity of workers |
| C. | Cause a substitution of capital for labour |
| D. | Decrease the MP of those workers |
| Answer» D. Decrease the MP of those workers | |
| 40. |
The price of capital is |
| A. | money |
| B. | Interest |
| C. | profits |
| D. | wages |
| Answer» C. profits | |
| 41. |
If MRP > Price of the factor: firm should hire |
| A. | less factors |
| B. | more factors |
| C. | the same factors |
| D. | All of the above |
| Answer» C. the same factors | |
| 42. |
If MRP < P of the factor, firm should hire |
| A. | less factors |
| B. | more factors |
| C. | the same factors |
| D. | All of the above |
| Answer» B. more factors | |
| 43. |
The labor market equilibrium determines the wage rate and |
| A. | market |
| B. | employment |
| C. | money |
| D. | interest |
| Answer» C. money | |
| 44. |
Union leaders are in a worse position to bargain for higher wages if demand for labour is |
| A. | perfectly Elastic |
| B. | perfectly Inelastic |
| C. | Very large |
| D. | Permanent |
| Answer» B. perfectly Inelastic | |
| 45. |
An ethical or value judgement must be made in order to derive the |
| A. | Transformation curve |
| B. | Grand utility possibly curve |
| C. | Consumption contract curve |
| D. | Social welfare function |
| Answer» E. | |
| 46. |
The concept of social optimum was introduced in Welfare Economics by |
| A. | Vilfredo Pareto |
| B. | A. C. Pigou |
| C. | Adam Smith |
| D. | A. Marshall |
| Answer» B. A. C. Pigou | |
| 47. |
According to Kaldor-Hicks compensation criteria, the proposed change will increase the social welfare if |
| A. | The gains are equal to the losses |
| B. | The gains are greater than the losses |
| C. | The losses are greater than the gains |
| D. | None of the above |
| Answer» C. The losses are greater than the gains | |
| 48. |
The concept of Social Welfare function was firstly introduced by |
| A. | Pareto |
| B. | Kaldor |
| C. | Bergson |
| D. | Samuelson |
| Answer» D. Samuelson | |
| 49. |
The first condition of which economist states that welfare is said to increase when national income increases |
| A. | Kaldor-Hicks |
| B. | Adam Smith |
| C. | A. C. Pigou |
| D. | Prof . Bergson |
| Answer» D. Prof . Bergson | |
| 50. |
Compensation criterion principle is associated with the name of |
| A. | Kaldor-Hicks |
| B. | Vilfredo Pareto |
| C. | A. C. Pigou |
| D. | Prof . Bergson |
| Answer» B. Vilfredo Pareto | |