MCQOPTIONS
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MCQOPTIONS
This section includes 17 Mcqs, each offering curated multiple-choice questions to sharpen your Economics knowledge and support exam preparation. Choose a topic below to get started.
| 1. |
Which city has the following transport policy ? |
| A. | Car licenses are very expensive vehicle entry to the city center is very restricted road pricing is being introduced and modern cheap rail transport i |
| B. | London |
| C. | Athens |
| D. | Singapore |
| E. | New York |
| Answer» E. New York | |
| 2. |
The theory of the second best suggests that in the absence of perfect competition a privatized industry should charge a price of ? |
| A. | p = Z |
| B. | P = MC + Z |
| C. | p = MC |
| D. | P = MC – Z |
| Answer» C. p = MC | |
| 3. |
The external benefits of using cars are ____ and the external costs are _____? |
| A. | low; low |
| B. | high; high |
| C. | low; high |
| D. | high; low |
| Answer» D. high; low | |
| 4. |
Sales staff are keen to sell extended warranties because ? |
| A. | extended warranties offer value for money. |
| B. | the cost of repair will usually exceed the cost of the warranty |
| C. | they are paid commission on each extended warranty they sell. |
| D. | They are concerned about customer satisfaction. |
| Answer» D. They are concerned about customer satisfaction. | |
| 5. |
In the UK, electricity industry parts are a ____ and other parts are ___ ? |
| A. | nationalized; privatized |
| B. | natural monopoly; potentially competitive |
| C. | cartel; a sellers’ market |
| D. | monopolistic competition duopoly |
| Answer» C. cartel; a sellers’ market | |
| 6. |
In the country X it is now becoming possible to buy electricity from a gas company and gas from an electricity company. This is called ? |
| A. | deregulation |
| B. | making markets contestable |
| C. | natural monopoly. |
| D. | cross-subsidization. |
| Answer» C. natural monopoly. | |
| 7. |
Evidence suggests that the price elasticity of demand for motoring is ? |
| A. | absolutely inelastic |
| B. | Unitarily elastic |
| C. | Elastic |
| D. | inelastic |
| Answer» C. Elastic | |
| 8. |
Economists use the term regulatory capture to mean a situation where the private sector firms being regulated ? |
| A. | Persuade the regulator to operate in the industry’s interests |
| B. | Persuade the regulator to act in the firms interests. |
| C. | Bribe the regulator. |
| D. | Persuade the government to change the regulatory regime. |
| Answer» B. Persuade the regulator to act in the firms interests. | |
| 9. |
De-regulation is where the government ? |
| A. | removes barriers to entry |
| B. | imposes higher standards of conduct |
| C. | removes barriers to entry and minimum product quality standards |
| D. | breaks up private sector monopolies. |
| Answer» D. breaks up private sector monopolies. | |
| 10. |
Between 1990 and 1999 car ownership per thousand of the population fell in ? |
| A. | Spain |
| B. | Belgium |
| C. | USA |
| D. | UK |
| Answer» D. UK | |
| 11. |
Antimonopoly laws are based on the proposition that ? |
| A. | increasing market power is the best way to achieve efficiency. |
| B. | competition is the best way to achieve efficiency. |
| C. | public ownership is the best way to achieve efficiency |
| D. | regulation is the best way to achieve efficiency. |
| Answer» C. public ownership is the best way to achieve efficiency | |
| 12. |
Antimonopoly legislation is undertaken to ____ competition and market regulation is undertaken to ____ competition ? |
| A. | restrict; promote |
| B. | restrict; restrict |
| C. | promote; promote |
| D. | promote; restrict |
| Answer» E. | |
| 13. |
A merger in which firms at various stages in a production process combine is a ? |
| A. | production merger |
| B. | vertical merger |
| C. | conglomerate merger. |
| D. | horizontal merger |
| Answer» C. conglomerate merger. | |
| 14. |
A merger between a paper producer and a book publisher is an example of? |
| A. | a conglomerate merger. |
| B. | a horizontal merger |
| C. | a complementary products merger. |
| D. | a vertical merger |
| Answer» E. | |
| 15. |
A horizontal merger is a merger of? |
| A. | firms producing unrelated products |
| B. | firms producing complementary products |
| C. | firms at various stages in a production process. |
| D. | firms producing the same product |
| Answer» E. | |
| 16. |
A firm charging different buyers’ different prices for the same product is practicing ? |
| A. | Competitive pricing. |
| B. | Price discrimination |
| C. | price discounting. |
| D. | price fixing. |
| Answer» C. price discounting. | |
| 17. |
A conglomerate merger is a merger of ? |
| A. | firms producing the same product |
| B. | firms at various stages in production process. |
| C. | firm producing complementary products |
| D. | firms producing unrelated products. |
| Answer» E. | |