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

Micro economics studies such topics as

Question # 2

If a monopolist's has only fixed costs and chooses that output at which marginal cost equals price. it will

Question # 3

In capitalistic economy price is determined by

Question # 4

When the demand curve is a straight line the elasticity of demand at the center point will be.

Question # 5

Short run is a time frame where a firm can change its.,

Question # 6

The income effect of a price change

Question # 7

Price discrimination occurs when

Question # 8

The expected profit from the profit distribution above is.

Question # 9

Naveed purchases product M for which his income elasticity of demand is negative Apparently product M is.

Question # 10

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

Question # 11

A production possibilities curve indicates that when resources are being used efficiently

Question # 12

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.

Question # 13

Which of the following is a characteristics of monopolistic competition.

Question # 14

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

Question # 15

The demand for labor slopes down and to the right because of.

Question # 16

In perfect competition the transpiration cost

Question # 17

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

Question # 18

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 # 19

Suppose that the price elasticity of demand for maple syrup has been estimated at-2 if quantity demanded increased by 10 precent, price must have changed by.

Question # 20

A Market situation where the number of buyers is very large and the number of sellers are very small is called.

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PPSC Economics Chapter 2 Important MCQ's

Sr.# Question Answer
1 For commodities, X and Y, the possibilities are X is preferred to Y , Y is preferred to X or X and Y are equally preferred, In indifference curve analysis, this is known as the.
A. Comparability assumption
B. Transitivity assumption
C. Non seriation assumption
D. Reflexivity assumption
2 As long as all prices remain constant an increase in money income results in.
A. An increase in the slope of the budget line
B. A decrease in the slope of the budget line
C. An increase in the intercept of the budget line.
D. a decrease in the intercept of the budget line.
3 Firms entering a perfectly competitive market will cause the price of the product to
A. Decrease
B. Increase
C. Remain constant
D. Respond more to consumer demand than supply
4 As long as the principle of diminishing marginal utility is operating any increased consumption of a good.
A. Lowers total utility
B. Produces negative total utility
C. Lowers marginal utility and therefore total utility
D. Lowers marginal utility, but may raise total utility.
5 When oligopolistic firms interacting with one another each choose their best strategy given the strategies chosen by other firms in the market we have.
A. A cartel
B. The perfect competitive outcome
C. The Nash equilibrium
D. Monopolistic competition
6 The demand curve for labor for a monopolist when other inputs are fixed is equal to its
A. Marginal value product curve
B. Marginal revenue product curve
C. Horizontal summation of the firms demand curve at different output prices
D. Marginal physical product curve
7 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
8 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.
9 If a price floor of Rs.15 is imposed, the governments cost is.
A. Rs.150
B. Rs.300
C. Rs.750
D. Rs.450
10 The negative slope of the demand curve indicates that there is _______ relationship between the price and the quantity demanded.
A. A direct
B. An inverse
C. A positive
D. No relationship

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