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

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

Question # 2

If the price of an apple increased from 50 to 60 the quantity demanded will decrease because of.

Question # 3

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

Question # 4

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 # 5

In long run equilibrium a monopolistically competitive firm will find.

Question # 6

One of the following has more elastic demand.

Question # 7

The classical are of the view that utility can be.

Question # 8

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 # 9

If the estimated values of Y and Py in 1987 are Rs. 30,000 and Rs. 8 respectively the marginal revenue of X is.

Question # 10

If the demand curve for a good is downward sloping then the good must be.

Question # 11

The income elasticity of demand

Question # 12

Which of the following is not a basic assumption of perfect competition.

Question # 13

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 # 14

Which of the following shifts the demand curve for hot dogs leftward.

Question # 15

The demand for labor is the same as the

Question # 16

To maximize revenue, an excise tax should be imposed on a product

Question # 17

Firm A's margin of safety is.

Question # 18

The total utility of the third unit of product x is.

Question # 19

As long as the principle of diminishing marginal utility is operating any increased consumption of good.

Question # 20

When the demand curve is vertical its shows that the demand is.

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PPSC Economics Chapter 2 Important MCQ's

Sr.# Question Answer
1 Projects A,B,C,D,E cost Rs. 100, Rs, 200, Rs. 300, Rs. 400, and Rs. 500 with MEC's of 0.07, 0.06,0.09 ,0.10 and 0.11 respectively. The market rate of interest is 8% Total investment spending is
A. Rs. 1500
B. Rs.1300
C. Rs.1200
D. Rs.300
2 The "Law of demand" states that other things remaining the same the quantity demanded of any good is.
A. Directly related to its price
B. Positively related to its price
C. Inversely related to its price
D. Directly elated to the supply of the good
3 In order to constitute an oligopolistic market structure.
A. There must be a few firms in a given relevant market
B. There must be a few firms selling in a national market
C. There must be more than 20 firms selling in the international market
D. There must be fewer than 15 firm is any given market
4 Company A estimates the price elasticity of demand for its products.3.0 The price of the product is Rs. 15. If MC = 2+40, the profit maximizing level of output.
A. 4 units
B. 2 umits
C. 5 units
D. 3 units
5 When Daimler Benz maker of the Mercedes bought Chrysler the merger was
A. Horizontal
B. Vertical
C. Conglomerate
D. None of these
6 The method most commonly used to test the overall significance of a regression is.
A. The t test
B. The F -test
C. Chi square test
D. R
7 The income elasticity of inferior goods is
A. Zero
B. Positive
C. Negative
D. Unitary
8 A utility contour shows all the alternative combinations of two consumption goods that.
A. Can be produced with a given set of resources and technology
B. Yield the same total of utility
C. Can be purchased with a given budget at given prices
D. Equate the marginal utilities of these goods and therefore make the consumer indifferent between them.
9 In perfect competition price is settled by
A. Sellers
B. Buyers
C. Producers
D. Both a and b
10 An entrepreneur who collects profits in the short run for a new invention is collecting.
A. The competitive rate of return on capital
B. Temporary monopoly profit
C. Rent
D. A Ramsey surplus

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