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

00:00
Question # 1

If A, B, C and D are any four market baskets, and if the consumer has ranked them so that D is preferred to C, A is hot preferred to B, and B is not preferred to c then.

Question # 2

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.

Question # 3

The quantity of Y demanded increases by 6% when income changes, and income elasticity of demand is -0.9 income

Question # 4

If a monopoly is unable to cover its short run variable costs, if should.

Question # 5

In the short run the competitive firm will produce if.

Question # 6

If the income elasticity of demand is +4

Question # 7

The average total cost when 20 units of output are produced is

Question # 8

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

Question # 9

In the long run a profit maximizing firm will choose to exit a market when

Question # 10

When the price of an inferior goods falls ceteris paribus the substitution effect leads to ________ in the quantity purchased and the income effect leads to _______ in the quantity purchased.

Question # 11

If a monopolist's demand curve is downward sloping and linear, then its total revenue curve must be.

Question # 12

The Marginal cost of product W exhibiting positive externalities is McW = 25 + 5 Qs, the competitive price for each unit of W (Pw) is Rs. 175 and the positive externality is worth Rs. 100 to society for each unit produced. Society considers product W under produced by how many units.

Question # 13

The "Law of demand" states that other things remaining the same the quantity demanded of any good is.

Question # 14

In order to constitute an oligopolistic market structure.

Question # 15

A situation in which firms choose their best strategy given the strategies chosen by the other firms in the market is called.

Question # 16

The law of diminishing marginal returns to a factor of production is.

Question # 17

An income demanded curve of an inferior good is.

Question # 18

A typical demand curve cannot be

Question # 19

Cross -elasticity following commodities is very high

Question # 20

An -increase the expected future price of a good.

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PPSC Economics Chapter 2 Important MCQ's

Sr.# Question Answer
1 If average fixed cost is 40 and average variable cost is 80 for a given output we the know that average total cost is.
A. 40
B. 120
C. 80
D. None of the above
2 Naveed purchases product M for which his income elasticity of demand is negative Apparently product M is.
A. A necessity
B. An independent good
C. An inferior good
D. A luxury good
3 A consumer is said to be in equilibrium when the marginla utility and price of a commodity
A. More
B. Less
C. Irrelevant
D. Equal
4 A firm's total revenue is Rs. 4,500 when it sells 15 pairs of boots compared to Rs. 4,480 when it sells 14 pairs,. The marginal revenue of the 15th pair of boots is.
A. Rs.20
B. Rs.320
C. Rs. 4,480
D. Rs.300
5 In the long run a profit maximizing firm will choose to exit a market when
A. Fixed costs exceed total costs
B. Total revenue from production is less than total costs
C. Average fixed cost is rising.
D. Marginal cost exceeds marginal revenue at the current level of production.
6 The Marginal cost of product W exhibiting positive externalities is McW = 25 + 5 Qs, the competitive price for each unit of W (Pw) is Rs. 175 and the positive externality is worth Rs. 100 to society for each unit produced. Society considers product W under produced by how many units.
A. 10 Units
B. 15 Units
C. 20 Units
D. 5 units
7 The total utility of the third unit of product x is.
A. 10
B. 5
C. 23
D. 38
8 The arc elasticity formula is used to estimate elasticity when
A. The product is thought to be inelastic
B. The product is thought to be elastic
C. The demand function is known
D. There are two observations of price and quantity
9 When oligopolistic firms interacting with one another each choose their best strategy given the strategies chosen by other firm in the market we have
A. A cartel
B. The perfect competitive outcome
C. The Nash equilibrium
D. Monopolistic competiton
10 The tax is question 52 is
A. Progressive's
B. Regressive
C. Proportional
D. None of these

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