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

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

Question # 2

A linear homogenous production function would reveal.

Question # 3

A monopoly there is

Question # 4

Firm A's annual profit is.

Question # 5

In monopolistic competition, firms desire to sell more output at equilibrium because.

Question # 6

In perfect competition the transpiration cost

Question # 7

Which of the policies in the table above an increase in social welfare according to pareto efficiency.

Question # 8

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

Question # 9

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

Question # 10

If the price of both goods increase by the same percent , the budget line will.

Question # 11

The method most commonly used to test the overall significance of a regression is.

Question # 12

Law of variable proportion is also called.

Question # 13

A market demand curve can be derived by adding all the individual demand curves

Question # 14

If the monopolist maximizes profits when marginal revenue equals marginal cost equals average cost economic profits must be.

Question # 15

Which skills are most likely to be paid for by the employer.

Question # 16

The competitive firm maximizes its profit by operating where

Question # 17

When goods are compliments the cross demand curve

Question # 18

A utility contour shows all the alternative combinations of two consumption goods that.

Question # 19

A price cross elasticity of 0.81 between X and Y shows that.

Question # 20

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

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PPSC Economics Chapter 2 Important MCQ's

Sr.# Question Answer
1 Indifference curve has following characteristics except.
A. Convex to origin
B. Intersect each other
C. Not necessary to be parallel
D. None of these
2 When a tax is levied on a good.
A. The market price falls because demand declines.
B. The market price falls because supply falls.
C. A wedge is placed between the price buyers pay and the price sellers receive
D. The market price rises because demand falls.
3 In the short run if price falls the firm will respond by
A. Shutting down
B. Equating average variable cost to marginal revenue
C. Reducing output along its marginal cost curve as long as marginal revenue exceed average variable cost
D. None of the above
4 Micro economics studies such topics as
A. The factors that determine inflation
B. The forces that influence the price of shoes
C. The determinants of total output
D. Whether the unemployment rate will rise or fall
5 An increase in price causes an increase in total revenue when.
A. Demand is elastic
B. Demand is inelastic
C. Demand is unit elastic
D. All of the above are possible
6 Everyone's absolute income doubles family A's APC, according to the simple Keynesian consumption function is expected to.
A. Fall
B. Double
C. Increase
D. Halve
7 In monopolistic competition, firms desire to sell more output at equilibrium because.
A. Price is greater than average cost
B. Price is greater than average variable cost
C. Price is greater than marginal cost
D. Price is equal to marginal revenue
8 If a monopolist's demand curve is downward sloping and linear, then its total revenue curve must be.
A. Identical to the demand curve
B. A ray from the origin with a slope equal to price
C. negative sloped with twice the slope of the demand curve
D. A rising function of output that increases at a decreasing rate , reaches a maximum, then falls.
9 In a perfectly competitive market if firms are earning an economic profit the economic profit.
A. Attracts entry by more firms, which lowers the market price
B. Can be earned both in the short run and long run
C. Is less than the normal profit
D. Leads to a decreases in market demand
10 In the short run a competitive firm's supply curve is.
A. Its average variable cost cure to the right of the marginal cost curve.
B. Its marginal cost curve above the average variable cost curve.
C. It marginal cost curves above its average cost curve.
D. The horizontal summation of the marginal cost curves

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