Introduction To Micro Economics

68 Questions | By Sweetsalman123 | Last updated: Mar 21, 2022 | Total Attempts: 216

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1.

Find the correct match :
- A.
  
  An enquiry into the nature and causes of the wealth of the nation : A.C.Pigou.
- B.
  
  Science which deals with wealth : Alfred Marshall.
- C.
  
  Economics is the science which studies human behaviour as a relationship between ends and scarce means which have alternative uses : Robbins.
- D.
  
  The range of our enquiry becomes restricted to that part of social welfare that can be brought directly or indirectly into relation with the measuring rod of money : Adam Smith.
2.

The law of scarcity :
- A.
  
  Does not apply to rich, developed countries.
- B.
  
  Applies only to the less developed countries.
- C.
  
  Implies that consumers wants will be satisfied in a socialistic system.
- D.
  
  Implies that consumers wants will never be completely satisfied.
3.

Who expressed the view that aEconomics is neutral between enda?
- A.
  
  Robbins
- B.
  
  Marshall
- C.
  
  Pigou
- D.
  
  Adam Smith
4.

Which of the following is the best general definition of the study of Economics?
- A.
  
  Inflation and unemployment in a growing economy.
- B.
  
  Business decision making under foreign competition.
- C.
  
  Individual and social choice in the face of scarcity.
- D.
  
  The best way to invest in the stock market.
5.

What implication(s) does resource scarcity have for the satisfaction of wants?
- A.
  
  Not all wants can be satisfied.
- B.
  
  We will never be faced with the need to make choices.
- C.
  
  We must develop ways to decrease our individual wants.
- D.
  
  The discovery of new natural resources is necessary to increase our ability to satisfy wants.
6.

Rational decision making requires that :
- A.
  
  One's choices be arrived at logically and without error.
- B.
  
  One's choices be consistent with one's goals.
- C.
  
  One's choices never vary.
- D.
  
  One makes choices that do not involve trade-offs.
7.

Economics according to Lionel Robbins is a
- A.
  
  Normative science
- B.
  
  Applied science
- C.
  
  Positive science
- D.
  
  Experimental science
8.

Which of the following is a normative statement?
- A.
  
  Planned economies allocate resources via government departments.
- B.
  
  Most transitional economies have experienced problems of falling output and rising prices over the past decade.
- C.
  
  There is a greater degree of consumer sovereignty in market economies than planned economies.
- D.
  
  Reducing inequality should be a major priority for mixed economies.
9.

Macroeconomics is also called _______________ economics.
- A.
  
  Applied
- B.
  
  Aggregate
- C.
  
  Experimental
- D.
  
  None of the above
10.

An example of 'positive' economic analysis would be :
- A.
  
  An analysis of the relationship between the price of food and the quantity purchased.
- B.
  
  Determining how much income each person should be guaranteed.
- C.
  
  Determining the 'fair' price for food.
- D.
  
  Deciding how to distribute the output of the economy.
11.

Identify the correct statement :
- A.
  
  In deductive method logic proceeds from the particular to the general.
- B.
  
  Micro and Macro-Economics are interdependent.
- C.
  
  In a capitalist economy, the economic problems are solved by Planning Commission.
- D.
  
  Higher the prices lower is the quantity demanded of a product is a normative statement.
12.

A study of how increases in the corporate income tax rate will affect the national unemployment rate is an example of
- A.
  
  Macro-economics.
- B.
  
  Descriptive economics.
- C.
  
  Micro-economics.
- D.
  
  Normative economics.
13.

Which of the following does not suggest a macro approach for India?
- A.
  
  Determining the GNP of India.
- B.
  
  Finding the causes of failure of X and co.
- C.
  
  Identifying the causes of inflation in India.
- D.
  
  Analyse the causes of failure of industry in providing large scale employment.
14.

Economic goods are considered scarce resources because they
- A.
  
  Cannot be increased in quantity.
- B.
  
  Do not exist in adequate quantity to satisfy social requirements.
- C.
  
  Are of primary importance in satisfying social requirements.
- D.
  
  Are limited to man made goods.
15.

From the national point of view which of the following indicates micro approach?
- A.
  
  Per capita income of India.
- B.
  
  Underemployment in agricultural sector.
- C.
  
  Lock out in TELCO.
- D.
  
  Total savings in India.
16.

In a free market economy the allocation or resources is determined by
- A.
  
  Votes taken by consumers
- B.
  
  A central planning authority.
- C.
  
  Consumer preference.
- D.
  
  The level of profits of firms.
17.

A capitalist economy uses _________ as the principal means of allocating resources.
- A.
  
  Demand
- B.
  
  Supply
- C.
  
  Efficiency
- D.
  
  Prices
18.

In a free market economy, when consumers increase their purchase of a good and the level of ____________ exceeds_________then prices tend to rise.
- A.
  
  Demand, supply
- B.
  
  Supply, demand
- C.
  
  Prices, demand
- D.
  
  Profits, supply.
19.

Which of the following would be considered a disadvantage of allocating resources using a market system?
- A.
  
  Income will tend to be unevenly distributed.
- B.
  
  Significant unemployment may occur.
- C.
  
  It cannot prevent the wastage of scarce economic resources.
- D.
  
  Profits will tend to be low.
20.

In a mixed economy,
- A.
  
  All economic decisions are taken by the central authority.
- B.
  
  All economic decisions are taken by private entrepreneurs.
- C.
  
  Economic decisions are partly taken by the state and partly by the private entrepreneurs
- D.
  
  None of the above.
21.

The central problem in economics is that of
- A.
  
  Comparing the success of command versus market economies.
- B.
  
  Guaranteering that production occurs in the most efficient manner.
- C.
  
  Guaranteering a minimum level of income for ev^ry citizen.
- D.
  
  Allocating scarce resources in such a manner that society's unlimited needs or wants are satisfied as well as possible.
22.

An economy achieves aproductive efficiencya when :
- A.
  
  Resources are employed in their most highly valued uses.
- B.
  
  The best resources are employed.
- C.
  
  The total number of goods produced is greatest.
- D.
  
  Goods and services are produced at least cost and no resources are wasted.
23.

If the PPF is linear, i.e., a straight line, which of the following is true?
- A.
  
  As the production of a good increases, the opportunity cost of that good rises.
- B.
  
  As the production of a good increases, the opportunity cost of that good falls.
- C.
  
  Opportunity costs are constant.
- D.
  
  The economy is not at full employment when operating on the PPF.
24.

Periods of less than full employment correspond to
- A.
  
  Points outside the PPF.
- B.
  
  Points inside the PPF.
- C.
  
  Points on the PPF.
- D.
  
  Either points inside or outside the PPF.
25.

Which of the following would not result in an rightward shift of the PPF?
- A.
  
  An increase in investment in capital stock.
- B.
  
  A reduction in the labour unemployment rate.
- C.
  
  The discovery of new oil deposits in India.
- D.
  
  An increase in the number of people taking management training courses.