PPSC Economics Topic 2 MCQS Test Preparation

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MCQ's Test For PPSC Economics Topic 2 Micro Economics

Try The MCQ's Test For PPSC Economics Topic 2 Micro Economics

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PPSC Economics Topic 2 Micro Economics

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Question # 1

If a firm which polluted the water of area had to pay all social cost would have

Question # 2

The Lorenz curve shows that

Question # 3

The price of Ketchup at a market increases by 12.5% per can, which results in a decrease in quantity purchased by 40% per week, the demand is.

Question # 4

The marginal rate of substitution for two goods can be obtained from

Question # 5

If the production function is Q = 8 KL the marginal rate of technical substitution of labor for capital is.

Question # 6

If a monopolist faces a downward sloping market demand curve its.

Question # 7

A long-run total cost curve can be constructed from

Question # 8

Price discrimination is possible

Question # 9

According to Keynes, when the great depression started the government should be.

Question # 10

If the price elasticity of demand for a non giffen good is inelastic are decreased in its price result in.

Question # 11

if a consumer is purchasing only two commodities X and Y , and the marginal utility per dollar of Y is greater than the marginal utility per dollar of X to maximize total utility with the limited income the consumer should buy.

Question # 12

If the income elasticity of demand is +4

Question # 13

Goods which can be consume directly are

Question # 14

Everyone's absolute income doubles family A's APC, according to the simple Keynesian consumption function is expected to.

Question # 15

How much will a speculator invest now if he expects to earn Rs. 144 two years from now assuming the nominal rate of interest is 20%

Question # 16

An increase in price causes an increase in total revenue when.

Question # 17

The are price elasticity of demand is approximately

Question # 18

In the short run, the supply of farm commodities is.

Question # 19

In an industry with a falling long term supply curve, which of the following is true.

Question # 20

In perfect competition the industry will be in equilibrium.

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PPSC Economics Chapter 2 Important MCQ's

Sr.# Question Answer
1 As disposable income increases from Rs. 1500 to 2000 , saving increases from minus Rs. 50 to Rs.250 if the relationship between disposable income and saving is linear, the MPC obviously has a value of.
A. .6
B. .8
C. .4
D. .2
2 Firm A's annual profit is.
A. Rs.10,000
B. Rs.20,000
C. Rs.30,000
D. Rs.60,000
3 In monopsony there is
A. Single seller
B. Two buyers
C. Single buyer
D. Few buyer
4 If X , Y, and Z are willing to work for Rs. 4, Rs, 5, and Rs.6 respectively but N pays them Rs. 7 each, producers surplus is.
A. Rs. 4
B. Rs.7
C. Rs.5
D. Rs.6
5 If a simultaneous and equal percentage decrease in the use of all physical inputs leads to a larger percentage decrease in physical output a firm's production function is said to exhibit.
A. Decreasing returns to scale
B.
Constant returns to scale
C. Increasing returns to scale
D. Diseconomies of scale
6 The largest source of tax revenue for the federal government is
A. The prerenal income tax
B. The social security tax
C. the property tax
D. The sales tax
7 Which of the following correct about firms in an oligopoly.
A. Each firm has complete control over its own selling price
B. All firms independently charge monopoly prices
C. No one firm controls price but each has an influence on the price
D. There is no competition in oligopoly industries
8 If the price elasticity of demand for a non giffen good is inelastic are decreased in its price result in.
A. Increase in demand
B. Decrease in demand
C. Increase in total revenue
D. Decrease in total revenue
9 A profit maximizing monopolist in two separate markets will
A. Charge different price according to elasticity
B. Charged same price
C. Charged very high price
D. Charged very low price
10 The firm under monopolistic competition is likely to produce less and set a higher price than under perfect competition because.
A. The firm faces decreasing returns to scale
B. The firm faces increasing costs
C. The firm must incur selling expenses including advertising.
D. The firm faces a downward sloping demand curve

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