In Nash equilibrium each player chooses the best strategy ?

Assuming other players move first

given the strategies of other players

In a tariff and import quota lead to equivalent increase in the domestic price of steel, then ?

They have identical impact on how income is distributed

The quota results in efficiency reductions but the tariff does not

The tariff results in efficiency reductions but the quota does not

They have identical impact on how much is produced and consumed

They have identical impact on how income is distributed

Import quotas tend to result in all of the following except ?

domestic consumers of the imported good being harmed

domestic producers of the imported good being harmed

domestic consumers of the imported good being harmed

Prices increasing in the importing country

Prices falling in the exporting country

If the price of good is below the equilibrium price ?

the quantity demanded is equal to the quantity supplied and the price remains unchanged

there is a shortage and the price will rise

the quantity demanded is equal to the quantity supplied and the price remains unchanged

there is a shortage and the price will fall

there is a surplus and the price will rise

If the price of good is equal to the equilibrium price ?

there is surplus and the price will rise

there is a shortage and the price will fall

the quantity demanded is equal to the quantity supplied supplied and the price remains unchanged

there is surplus and the price will rise

there is a shortage and the price will rise

there is a surplus and the price will fall

If the price of a good is above the equilibrium price ?

there is a surplus and the price will rise

there is a shortage and the price will fall

there is a shortage and the price will rise

The quantity demanded is equal to the quantity supplied and the price remains unchanged

there is a surplus and the price will fall

If the market price is below the equilibrium price ?

quantity demanded will be less than quantity supplied

quantity demanded will be greater than quantity supplied

quantity demanded will be less than quantity supplied

demand will be less than supply.

quantity demanded will equal quantity supplied

If the home country government grants a subsidy on a domestically produced good domestic producers tend to ?

reduce wages paid to domestic workers

Capture the entire subsidy in the form of higher profits

Increase their level of production

reduce wages paid to domestic workers

consider the subsidy as a increase in production cost

If demand increase in a market this will usually lead to ?

A lower equilibrium price and higher output

A higher equilibrium price and output

A lower equilibrium price and higher output

A lower equilibrium price and output

A higher equilibrium price and lower output

If a tariff and import quota lead to equivalent increases in the domestic price of steel, then ?

the quota results in efficiency reductions but the tariff does not

The tariff results in efficiency reductions but the quota does not

They have different impacts on how much is produced and consumed

They have different impacts on how income is distributed

If a government were to fix a minimum wage for adult workers, economists would predict ?

there would be more unemployment

wages in general would fall as employers tried to hold down costs

fewer young workers would be employed

the costs and prices of firms employing cheap labour would increase

there would be more unemployment

From the perspective of the American public as a whole, export subsidies levied by overseas governments on goods sold to the United States ?

are equivalent to an import quota

are equivalent to an export quota

For year the U.S government levied quotas on inexpensive oil imported from the Middle East The quotas led to cost increases for U.S consumers totaling $3 billion for oil products. An apparent justification of this policy was that ?

The U.S government needed the quota revenue to balance its budget

U.S oil companies and workers deserved higher incomes

U.S oil was of superior quality and merited higher prices

one should not be too dependent on foreign suppliers of crucial resources

The U.S government needed the quota revenue to balance its budget

Externalities arise because there is a divergence between ________ and _________?

private costs, private benefits

private costs, social costs or benefits

Export subsidies levied by foreign governments on products in which the Pakistan the comparative disadvantage ?

encourage Pakistan’s production of competing goods

lower the welfare of all Pakistanis

lead to increases in Pakistani consumer surplus

encourage Pakistan’s production of competing goods

encourage Pakistani workers to demand higher wages

Except for taxes to offset ______ taxes are ______?

inequality , a first best option

Economists use the term Black Markets for situations where ?

buyers and/or sellers are not paying taxes as they should

goods are sold at prices above legal or official price.

buyers and/or sellers are not paying taxes as they should

transactions are not recorded in the GDP figures.

During periods of growing domestic demand, an import quota ?

has the same restrictive effect on a country’s imports as a tariff

is less restrictive on a country’s imports than a tariff

Is more restrictive on a country’s imports than a tariff

has the same restrictive effect on a country’s imports as a tariff

will always generate increased tax revenue for the government

Buy national policies ?

result in government purchase policies favoring foreign over domestic producers

result in government purchase policies favoring domestic over foreign producers

result in government purchase policies favoring foreign over domestic producers

attempt to restrict the number of tourists leaving a nation

are intended to publicize the advantage of the most efficient domestic companies

Assuming a downward sloping demand curve and upward sloping supply curve a higher equilibrium price may be caused by ?

improvements in production technology

Antidumping duties are used to ?

punish domestic consumers for buying high-priced imported goods

discourage foreign governments from subsidizing their exporters

reduce the tariff revenue of the domestic government

An increase (rightward shift) in the demand for a good will tend to cause ?

an increase in the equilibrium price and quantity

an increase in the equilibrium price and a decrease in the equilibrium quantity

a decrease in the equilibrium quantity.

a decrease in the equilibrium price and quantity.

An increase in income will ?

Lead to a movement along the demand curve

An increase in demand for a product should ?

Increase equilibrium price and quantity

Decrease equilibrium price and quantity

Increase equilibrium price and decrease quantity

Decrease equilibrium price and increase quantity

All of the following shift the supply of watches to the right except ?

All of these answers cause an increase in the supply of watches

an advance in the technology used to manufacture watches

an increase in the price of watches

All of these answers cause an increase in the supply of watches

a decrease in the wage of workers employed to manufacture watches

Agricultural prices tend to be unstable because ?

Demand and supply are price inelastic

A tariff-rate quota is essentially a ?

three-tier tariff applied to a country’s imports

two tier tariff applied to a country’s imports

three-tier tariff applied to a country’s imports

two tier quota applied to a county’s exports

three tier quota applied to a country’s exports

124 + Mcqs in Market Page 2 McqOptions

51.	In Nash equilibrium each player chooses the best strategy ?
A.	Assuming other players move first
B.	dominated by the other players
C.	given the strategies of other players
D.	that is a credible threat
Answer» D. that is a credible threat

Discussion

52.	In certain industries Japanese employers hesitate to lay off workers Therefore they sometimes have excess supplies of goods that they cannot sell on the home market without lowering prices. To hold down losses they sell goods in overseas markets at prices well beneath those in japan This practice is best referred to as ?
A.	Orderly marketing
B.	trigger pricing
C.	domestic content pricing
D.	dumping
Answer» E.

Discussion

53.	In a tariff and import quota lead to equivalent increase in the domestic price of steel, then ?
A.	The quota results in efficiency reductions but the tariff does not
B.	The tariff results in efficiency reductions but the quota does not
C.	They have identical impact on how much is produced and consumed
D.	They have identical impact on how income is distributed
Answer» D. They have identical impact on how income is distributed

Discussion

54.	In a free market system rationing occurs when there are increases in ?
A.	price
B.	quantity
C.	demand
D.	supply
Answer» E.

Discussion

55.	Import quotas tend to result in all of the following except ?
A.	domestic producers of the imported good being harmed
B.	domestic consumers of the imported good being harmed
C.	Prices increasing in the importing country
D.	Prices falling in the exporting country
Answer» B. domestic consumers of the imported good being harmed

Discussion

56.	If two firms doing the same thing in the same industry join together, this is known as a ?
A.	vertical merger
B.	horizontal merger
C.	conglomerate merger
D.	hostile takeover
Answer» C. conglomerate merger

Discussion

57.	If the price was fixed below the equilibrium price there would be ?
A.	Excess supply
B.	Excess demand
C.	Equilibrium
D.	Downward pressure on prices
Answer» C. Equilibrium

Discussion

58.	If the price of good is below the equilibrium price ?
A.	there is a shortage and the price will rise
B.	the quantity demanded is equal to the quantity supplied and the price remains unchanged
C.	there is a shortage and the price will fall
D.	there is a surplus and the price will rise
Answer» B. the quantity demanded is equal to the quantity supplied and the price remains unchanged

Discussion

59.	If the price of good is equal to the equilibrium price ?
A.	there is a shortage and the price will fall
B.	the quantity demanded is equal to the quantity supplied supplied and the price remains unchanged
C.	there is surplus and the price will rise
D.	there is a shortage and the price will rise
E.	there is a surplus and the price will fall
Answer» C. there is surplus and the price will rise

Discussion

60.	If the price of a good is above the equilibrium price ?
A.	there is a surplus and the price will rise
B.	there is a shortage and the price will fall
C.	there is a shortage and the price will rise
D.	The quantity demanded is equal to the quantity supplied and the price remains unchanged
E.	there is a surplus and the price will fall
Answer» F.

Discussion

61.	If the price in a market is fixed by the government below equilibrium ?
A.	There is excess equilibrium
B.	There is excess supply
C.	There is excess demand
D.	There is equilibrium
Answer» D. There is equilibrium

Discussion

62.	If the price in a market is fixed by the government above equilibrium ?
A.	There is excess equilibrium
B.	There is excess supply
C.	There is excess demand
D.	There is equilibrium
Answer» C. There is excess demand

Discussion

63.	If the market price is below the equilibrium price ?
A.	quantity demanded will be greater than quantity supplied
B.	quantity demanded will be less than quantity supplied
C.	demand will be less than supply.
D.	quantity demanded will equal quantity supplied
Answer» B. quantity demanded will be less than quantity supplied

Discussion

64.	If the home country government grants a subsidy on a domestically produced good domestic producers tend to ?
A.	Capture the entire subsidy in the form of higher profits
B.	Increase their level of production
C.	reduce wages paid to domestic workers
D.	consider the subsidy as a increase in production cost
Answer» C. reduce wages paid to domestic workers

Discussion

65.	If the consumption of good by one person does not reduce the quantity available by others and nobody can be easily excluded from consumption, we are referring to a ?
A.	Private good
B.	merit good
C.	public good
D.	abundant good
Answer» D. abundant good

Discussion

66.	If my neighbour burns garden waste causing my house to fill with smoke this is an example of ?
A.	a production externality
B.	a second-best solution
C.	transaction costs
D.	a consumption externality
Answer» E.

Discussion

67.	If imports licenses are auctioned off to domestic importers in competitive market their scarcity value (revenue effect) accrues to ?
A.	foreign corporations
B.	foreign workers
C.	domestic corporations
D.	The domestic government
Answer» E.

Discussion

68.	If demand increase in a market this will usually lead to ?
A.	A higher equilibrium price and output
B.	A lower equilibrium price and higher output
C.	A lower equilibrium price and output
D.	A higher equilibrium price and lower output
Answer» B. A lower equilibrium price and higher output

Discussion

69.	If an increase in the price of blue jeans leads to an increase in the demand for tennis shoes, then blue jeans and tennis shoes are ?
A.	Complements
B.	inferior goods
C.	normal goods
D.	none of these answers
E.	Substitutes
Answer» F.

Discussion

70.	If an increase in consumer incomes leads to a decrease in the demand for camping equipment, then camping equipment is ?
A.	a normal good
B.	none of these answers
C.	an inferior good
D.	a substitute good
Answer» D. a substitute good

Discussion

71.	If a tariff and import quota lead to equivalent increases in the domestic price of steel, then ?
A.	the quota results in efficiency reductions but the tariff does not
B.	The tariff results in efficiency reductions but the quota does not
C.	They have different impacts on how much is produced and consumed
D.	They have different impacts on how income is distributed
Answer» E.

Discussion

72.	If a maximum price is set below equilibrium there will be ?
A.	A price fall
B.	A price increase
C.	Excess supply
D.	Excess demand
Answer» D. Excess demand

Discussion

73.	If a government were to fix a minimum wage for adult workers, economists would predict ?
A.	wages in general would fall as employers tried to hold down costs
B.	fewer young workers would be employed
C.	the costs and prices of firms employing cheap labour would increase
D.	there would be more unemployment
Answer» D. there would be more unemployment

Discussion

74.	Governments around the world tend to auction quota licenses ?
A.	never
B.	seldom
C.	often
D.	always
Answer» C. often

Discussion

75.	From the perspective of the American public as a whole, export subsidies levied by overseas governments on goods sold to the United States ?
A.	help more than they hurt
B.	hurt more then they help
C.	are equivalent to an import quota
D.	are equivalent to an export quota
Answer» B. hurt more then they help

Discussion

76.	For year the U.S government levied quotas on inexpensive oil imported from the Middle East The quotas led to cost increases for U.S consumers totaling $3 billion for oil products. An apparent justification of this policy was that ?
A.	U.S oil companies and workers deserved higher incomes
B.	U.S oil was of superior quality and merited higher prices
C.	one should not be too dependent on foreign suppliers of crucial resources
D.	The U.S government needed the quota revenue to balance its budget
Answer» D. The U.S government needed the quota revenue to balance its budget

Discussion

77.	Externalities arise because there is a divergence between ________ and _________?
A.	private costs, private benefits
B.	private costs, social costs or benefits
C.	social costs, social benefit
D.	insiders, outsiders
Answer» C. social costs, social benefit

Discussion

78.	Export subsidies levied by foreign governments on products in which the Pakistan the comparative disadvantage ?
A.	lower the welfare of all Pakistanis
B.	lead to increases in Pakistani consumer surplus
C.	encourage Pakistan’s production of competing goods
D.	encourage Pakistani workers to demand higher wages
Answer» C. encourage Pakistan’s production of competing goods

Discussion

79.	Except for taxes to offset ______ taxes are ______?
A.	imperfect competition popular
B.	externalities , distortionary
C.	inequality , a first best option
D.	poor health, unnecessary
Answer» C. inequality , a first best option

Discussion

80.	Economists use the term Black Markets for situations where ?
A.	goods are sold at prices above legal or official price.
B.	buyers and/or sellers are not paying taxes as they should
C.	illegal substances are sold
D.	transactions are not recorded in the GDP figures.
Answer» B. buyers and/or sellers are not paying taxes as they should

Discussion

81.	Economics say that there has to be some from of rationing whenever ?
A.	inflation occurs
B.	there are externalities
C.	merit goods are produced
D.	there is excess demand
Answer» E.

Discussion

82.	During periods of growing domestic demand, an import quota ?
A.	is less restrictive on a country’s imports than a tariff
B.	Is more restrictive on a country’s imports than a tariff
C.	has the same restrictive effect on a country’s imports as a tariff
D.	will always generate increased tax revenue for the government
Answer» C. has the same restrictive effect on a country’s imports as a tariff

Discussion

83.	Comparing a monopoly and competitive firm, the monopolist will ?
A.	produce less at a lower price
B.	produce more at a lower price
C.	produce less at a higher price
D.	produce less at a lower price
Answer» D. produce less at a lower price

Discussion

84.	By practicing price discrimination, the firm would realize profits totaling ?
A.	$160,000
B.	$420,000
C.	$540,000
D.	$660,000
Answer» E.

Discussion

85.	Buy national policies ?
A.	result in government purchase policies favoring domestic over foreign producers
B.	result in government purchase policies favoring foreign over domestic producers
C.	attempt to restrict the number of tourists leaving a nation
D.	are intended to publicize the advantage of the most efficient domestic companies
Answer» B. result in government purchase policies favoring foreign over domestic producers

Discussion

86.	Assuming a downward sloping demand curve and upward sloping supply curve a higher equilibrium price may be caused by ?
A.	An fall in demand
B.	An increase in supply
C.	improvements in production technology
D.	An increase in demand
Answer» E.

Discussion

87.	________ are profits that accrue to whomever has the right to import the good that is restricted by the quota?
A.	quota license
B.	quota rents
C.	quota prices
D.	None of the above
Answer» C. quota prices

Discussion

88.	___________ are quotas that lead to a complete abolishment of trade?
A.	embargoes
B.	voluntary export restraints
C.	nontariff barriers
D.	orderly marketing agreements
Answer» B. voluntary export restraints

Discussion

89.	Antidumping duties are used to ?
A.	offset the margin of dumping
B.	punish domestic consumers for buying high-priced imported goods
C.	discourage foreign governments from subsidizing their exporters
D.	reduce the tariff revenue of the domestic government
Answer» B. punish domestic consumers for buying high-priced imported goods

Discussion

90.	A(n) ________ is n example of a quota where foreigners hold quota licenses ?
A.	export quota
B.	embargo
C.	auction quota
D.	tariff quota
Answer» B. embargo

Discussion

91.	An inferior good is one for which an increase in income causes a(n) ?
A.	decrease in supply
B.	increase in demand
C.	increase in supply
D.	decrease in demand
Answer» E.

Discussion

92.	An increase (rightward shift) in the demand for a good will tend to cause ?
A.	an increase in the equilibrium price and quantity
B.	none of these answers
C.	an increase in the equilibrium price and a decrease in the equilibrium quantity
D.	a decrease in the equilibrium quantity.
E.	a decrease in the equilibrium price and quantity.
Answer» F.

Discussion

93.	An increase in income will ?
A.	Lead to a movement along the demand curve
B.	Shift the supply curve
C.	Shift the demand curve
D.	Lead to an extension of demand
Answer» D. Lead to an extension of demand

Discussion

94.	An increase in demand for a product should ?
A.	Increase equilibrium price and quantity
B.	Decrease equilibrium price and quantity
C.	Increase equilibrium price and decrease quantity
D.	Decrease equilibrium price and increase quantity
Answer» E.

Discussion

95.	An allocation is Pareto-efficient if no reallocation of resources would make some people _______ without making others ________?
A.	worse off; worse off
B.	better off; better off
C.	better off; worse off
D.	equal, unequal
Answer» D. equal, unequal

Discussion

96.	All of the following shift the supply of watches to the right except ?
A.	an advance in the technology used to manufacture watches
B.	an increase in the price of watches
C.	All of these answers cause an increase in the supply of watches
D.	a decrease in the wage of workers employed to manufacture watches
Answer» C. All of these answers cause an increase in the supply of watches

Discussion

97.	All of the following are types of imperfect competition except ?
A.	monopolistic competition
B.	oligopoly
C.	monopoly
D.	unfair competition
Answer» E.

Discussion

98.	Agricultural prices tend to be unstable because ?
A.	Supply is price elastic
B.	Demand is price elastic
C.	Supply is stable
D.	Demand and supply are price inelastic
Answer» E.

Discussion

99.	According to the cost-based definition of dumping, dumping occurs when a firm sells a product abroad at a price that is less than ?
A.	average total cost
B.	average variable cost
C.	average fixed cost
D.	marginal cost
Answer» B. average variable cost

Discussion

100.	A tariff-rate quota is essentially a ?
A.	two tier tariff applied to a country’s imports
B.	three-tier tariff applied to a country’s imports
C.	two tier quota applied to a county’s exports
D.	three tier quota applied to a country’s exports
Answer» B. three-tier tariff applied to a country’s imports

Discussion

Explore topic-wise MCQs in Economics.

In Nash equilibrium each player chooses the best strategy ?

In a tariff and import quota lead to equivalent increase in the domestic price of steel, then ?

In a free market system rationing occurs when there are increases in ?

Import quotas tend to result in all of the following except ?

If two firms doing the same thing in the same industry join together, this is known as a ?

If the price was fixed below the equilibrium price there would be ?

If the price of good is below the equilibrium price ?

If the price of good is equal to the equilibrium price ?

If the price of a good is above the equilibrium price ?

If the price in a market is fixed by the government below equilibrium ?

If the price in a market is fixed by the government above equilibrium ?

If the market price is below the equilibrium price ?

If the home country government grants a subsidy on a domestically produced good domestic producers tend to ?

If the consumption of good by one person does not reduce the quantity available by others and nobody can be easily excluded from consumption, we are referring to a ?

If my neighbour burns garden waste causing my house to fill with smoke this is an example of ?

If imports licenses are auctioned off to domestic importers in competitive market their scarcity value (revenue effect) accrues to ?

If demand increase in a market this will usually lead to ?

If an increase in the price of blue jeans leads to an increase in the demand for tennis shoes, then blue jeans and tennis shoes are ?

If an increase in consumer incomes leads to a decrease in the demand for camping equipment, then camping equipment is ?

If a tariff and import quota lead to equivalent increases in the domestic price of steel, then ?

If a maximum price is set below equilibrium there will be ?

If a government were to fix a minimum wage for adult workers, economists would predict ?

Governments around the world tend to auction quota licenses ?

From the perspective of the American public as a whole, export subsidies levied by overseas governments on goods sold to the United States ?

For year the U.S government levied quotas on inexpensive oil imported from the Middle East The quotas led to cost increases for U.S consumers totaling $3 billion for oil products. An apparent justification of this policy was that ?

Externalities arise because there is a divergence between ________ and _________?

Export subsidies levied by foreign governments on products in which the Pakistan the comparative disadvantage ?

Except for taxes to offset ______ taxes are ______?

Economists use the term Black Markets for situations where ?

Economics say that there has to be some from of rationing whenever ?

During periods of growing domestic demand, an import quota ?

Comparing a monopoly and competitive firm, the monopolist will ?

By practicing price discrimination, the firm would realize profits totaling ?

Buy national policies ?

Assuming a downward sloping demand curve and upward sloping supply curve a higher equilibrium price may be caused by ?

________ are profits that accrue to whomever has the right to import the good that is restricted by the quota?

___________ are quotas that lead to a complete abolishment of trade?

Antidumping duties are used to ?

A(n) ________ is n example of a quota where foreigners hold quota licenses ?

An inferior good is one for which an increase in income causes a(n) ?

An increase (rightward shift) in the demand for a good will tend to cause ?

An increase in income will ?

An increase in demand for a product should ?

An allocation is Pareto-efficient if no reallocation of resources would make some people _______ without making others ________?

All of the following shift the supply of watches to the right except ?

All of the following are types of imperfect competition except ?

Agricultural prices tend to be unstable because ?

According to the cost-based definition of dumping, dumping occurs when a firm sells a product abroad at a price that is less than ?

A tariff-rate quota is essentially a ?

Externalities arise because there is a divergence between and _?

Except for taxes to offset taxes are ?

An allocation is Pareto-efficient if no reallocation of resources would make some people _ without making others __?