MCQOPTIONS
Saved Bookmarks
MCQOPTIONS
This section includes 44 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 of the following would be excluded from UK GDP fro 2005? The sale of ? |
| A. | a haircut |
| B. | the value of a lawyer’s services |
| C. | a 2005 Honda made in Swindon |
| D. | All of things mentioned in these answers should be counted in 2005 GDP. |
| Answer» B. the value of a lawyer’s services | |
| 2. |
Which of the following is an example of tragedy of commons ? |
| A. | over fishing |
| B. | smoking in a public place |
| C. | excessive rain |
| D. | common use of public toilets |
| Answer» B. smoking in a public place | |
| 3. |
Which of the following country has 25 percent of the world’s estimated oil reserves and the lowest cost production as well as a dominant role in OPEC pricing ? |
| A. | Russia |
| B. | Saudi Arabia |
| C. | Iraq |
| D. | Venezuela |
| Answer» C. Iraq | |
| 4. |
UK GDP would exclude which of the following ? |
| A. | Lawyer services purchased by a home buyer |
| B. | The purchase of a new Nissan produced in Sunderland |
| C. | Copper purchased by tap manufacturer Bristan |
| D. | A new art gallery purchased by the city of Newcastle |
| E. | Lawn care services purchased by a home owner. |
| Answer» D. A new art gallery purchased by the city of Newcastle | |
| 5. |
To adjust GDP from market prices to factor cost ? |
| A. | Add indirect taxes |
| B. | Subtract subsidies |
| C. | Deduct indirect taxes and subsidies |
| D. | Deduct indirect taxes and add subsidies |
| Answer» C. Deduct indirect taxes and subsidies | |
| 6. |
To adjust from Gross National Product to Net National Product ? |
| A. | Deduct depreciation |
| B. | Deduct indirect taxes |
| C. | Deduct subsidies |
| D. | Add inflation |
| Answer» D. Add inflation | |
| 7. |
Theodore panayotou (1993) argues that environment degradation originates from the following EXCEPT ? |
| A. | markets distortions |
| B. | defective economic policies |
| C. | inadequate property |
| D. | the expansion of capitalism |
| Answer» E. | |
| 8. |
The value of plant and equipment worn out in the process of manufacturing goods and services is measured by ? |
| A. | intermediate production |
| B. | Net National Product |
| C. | Investment |
| D. | depreciation |
| E. | consumption |
| Answer» E. consumption | |
| 9. |
The standard of living is often measured by ? |
| A. | Real GDP per capita |
| B. | Real GDP |
| C. | Real GDP population |
| D. | Real GDP plus depreciation |
| Answer» B. Real GDP | |
| 10. |
The Organization of Petroleum Exporting Countries (OPEC) is a(n) _________whose members agree to limit output and fix prices? |
| A. | monopoly |
| B. | entropy |
| C. | industry |
| D. | cartel |
| Answer» E. | |
| 11. |
The Montreal Protocal, signed in 1987 and strengthened in 1990 ? |
| A. | attains the global optimal level of common property resource |
| B. | relies on internationally tradable emission permits |
| C. | minimizes free riders of public goods |
| D. | reduces ozone depletion through the cutting of chlorofluorocarbon production |
| Answer» E. | |
| 12. |
The green house effect is the phenomenon by which ? |
| A. | biological diversity is dominant in agricultural production |
| B. | the globe’s water pollution affects plankton |
| C. | the earth’s atmosphere traps infrared radiation |
| D. | climatic changes occur naturally in the forest |
| Answer» D. climatic changes occur naturally in the forest | |
| 13. |
The government levying taxes on polluters or charging a surcharge for pesticide use are ? |
| A. | examples of Coase’s theorem |
| B. | internalization of negative spillover effects |
| C. | marginal abatement cost |
| D. | examples of a free rider |
| Answer» C. marginal abatement cost | |
| 14. |
The Genuine Progress indicator is ? |
| A. | also known as index of Sustainable Economic Welfare per capita |
| B. | GDP plus resource depletion and environmental cost |
| C. | resource depletion and environmental cost divided by GDP per capita |
| D. | increasing from 1976 to 2000 |
| Answer» B. GDP plus resource depletion and environmental cost | |
| 15. |
The Club of Rome Study, The Limits to Growth suggests that as natural resources diminish ? |
| A. | capital increasingly replaces labor |
| B. | technological change compensates for capital depletion |
| C. | costs rise, leaving less capital for future investment |
| D. | contingent valuation becomes critical |
| Answer» D. contingent valuation becomes critical | |
| 16. |
The booming of North Seas’ gas export revenues in the 1970s that appreciated the guilder, making industrial export more costly in foreign currencies and increasing foreign competition and unemployment is known as ? |
| A. | Trade deficit |
| B. | Blind river disease |
| C. | Dutch disease |
| D. | Economic turmoil |
| Answer» D. Economic turmoil | |
| 17. |
Real GDP is measured in __________ prices while nominal GDP is measured in _________ prices? |
| A. | foreign; domestic |
| B. | current year; base year |
| C. | domestic; foreign |
| D. | base year; current year |
| E. | intermediate; final |
| Answer» E. intermediate; final | |
| 18. |
Progress that meets the needs of the present without compromising the ability of future generations to meet their own needs is ? |
| A. | the tragedy of commons |
| B. | sustainable development |
| C. | net primary productivity (NPP) |
| D. | the impossibility theorem |
| Answer» C. net primary productivity (NPP) | |
| 19. |
Pakistan’s Gross Domestic Product (in contrast to Gross National Product) measures the production and income of ? |
| A. | Pakistan -owned firms no matter where they are located in the world |
| B. | The domestic manufacturing sector only |
| C. | The domestic service sector only |
| D. | People and factories located within the borders of the Pakistan |
| E. | none of these answers |
| Answer» C. The domestic service sector only | |
| 20. |
Net National Product equals ? |
| A. | Gross National Product adjusted for inflation |
| B. | Gross Domestic Product adjusted for inflation |
| C. | Gross Domestic Product plus net property income from abroad |
| D. | Gross National Product minus depreciation |
| Answer» E. | |
| 21. |
Negative externality is also known as ? |
| A. | external diseconomies |
| B. | marginal damage |
| C. | public goods |
| D. | resource curse |
| Answer» B. marginal damage | |
| 22. |
Micheal Roemer’s three-sector model shows that growth in the booming export sector I- reduces the price of foreign exchange II- retards other sectors’ growth by reducing incentives to export other commodities III- reduces incentives to replace domestic goods for imports IV- raises factor and input prices for non-booming sectors ? |
| A. | I and III only |
| B. | II and III only |
| C. | I, II and III only |
| D. | I, II , III only IV |
| Answer» E. | |
| 23. |
Many environmental resources are public goods, which are characterized by ? |
| A. | rivalry and exclusion in consumption |
| B. | nonrivalry and nonexclusion in consumption |
| C. | rivalry but nonexclusion in production |
| D. | nonrivalry but exclusion in usage |
| Answer» C. rivalry but nonexclusion in production | |
| 24. |
Land and natural resources are considered ? |
| A. | capital accumulation |
| B. | common property resources |
| C. | non-producible |
| D. | output |
| Answer» D. output | |
| 25. |
Irreversibility refers to ? |
| A. | natural resource that cannot be reproduced in the future if we fail to preserve them now |
| B. | obtaining intellectual property rights for products |
| C. | natural extinction of various species in DCs |
| D. | industrialization replacing agriculture in LDCs |
| Answer» B. obtaining intellectual property rights for products | |
| 26. |
In a recession ? |
| A. | Unemployment is likely to be low |
| B. | Prices are likely to increase |
| C. | Growth is negative |
| D. | Growth is slow |
| Answer» E. | |
| 27. |
In a recession a government ? |
| A. | Is likely to want to decrease demand in the economy |
| B. | Is likely to want to decrease demand in the economy |
| C. | Is likely to want to stabilise demand in the economy |
| D. | Is likely to want to increase supply in the economy |
| Answer» E. | |
| 28. |
In a boom ? |
| A. | Surpluses are likely to occur: |
| B. | Prices are likely to fall |
| C. | Supply will increase immediately to match demand |
| D. | Shortages may occur |
| Answer» D. Shortages may occur | |
| 29. |
If your grandparents buy a newly built retirement home, this transaction would affect ? |
| A. | investment |
| B. | net exports |
| C. | government purchases |
| D. | consumption |
| E. | none of these answers |
| Answer» B. net exports | |
| 30. |
If Pakistan’s GDP exceeds Pakistan’s GNP, then ? |
| A. | intermediate production exceeds final production |
| B. | foreigners are producing more in the Pakistan then Pakistanis are producing in foreign countries |
| C. | real GNP exceeds nominal GNP |
| D. | real GDP exceeds nominal GDP |
| Answer» C. real GNP exceeds nominal GNP | |
| 31. |
If nominal GDP in 2005 exceeds nominal GDP in 2004, then the production of output ? |
| A. | must have fallen |
| B. | must have risen |
| C. | must have stayed the same |
| D. | may have risen fallen, or stayed the same because there is not enough information to determine what happened to real output |
| Answer» E. | |
| 32. |
If a cobbler buys leather for Rs100 and thread for Rs50 and uses them to produce and sell Rs500 worth of shoes to consumers the contribution to GDP is ? |
| A. | Rs50 |
| B. | Rs100 |
| C. | Rs650 |
| D. | Rs500 |
| Answer» E. | |
| 33. |
How is your purchase in Pakistan of a Rs40,000 BMW automobile that was produced entirely in Germany recorded in the Pakistan’s GDP accounts ? |
| A. | Consumption in increase by Rs40,000 and net export decreases by Rs40,000 |
| B. | Net exports increase by Rs40,000 |
| C. | There is no impact because this transaction does not involve domestic production |
| D. | Investment increased by Rs40,000 and net exports increases by Rs40,000 |
| Answer» B. Net exports increase by Rs40,000 | |
| 34. |
Gross National Product equals ? |
| A. | Net National Product adjusted for inflation |
| B. | Gross Domestic Product adjusted for inflation |
| C. | Gross Domestic Product plus net property income from abroad |
| D. | Net National Product plus net property income from abroad |
| Answer» C. Gross Domestic Product plus net property income from abroad | |
| 35. |
Gross Domestic Product is the sum of the market value of the ? |
| A. | intermediate goods |
| B. | final goods and services |
| C. | manufactured goods |
| D. | inferior goods and services |
| E. | normal goods and services |
| Answer» C. manufactured goods | |
| 36. |
Gross Domestic Product can be measured as the sum of ? |
| A. | final goods and services intermediate goods, transfer payments, and rent |
| B. | consumption investment government purchases and net exports |
| C. | consumption transfer payments. wages and profits |
| D. | Net National Product Gross National Product, and Disposable personal income |
| E. | investment wages profits and intermediate production |
| Answer» E. investment wages profits and intermediate production | |
| 37. |
GDP would include which of the following ? |
| A. | the value of taking a day off from work |
| B. | consulting services |
| C. | intermediate sales |
| D. | illegal drug sales |
| E. | housework |
| Answer» C. intermediate sales | |
| 38. |
GDP plus net property income from abroad equals what ? |
| A. | GNP |
| B. | NNP |
| C. | Depreciation |
| D. | Real GDP |
| Answer» B. NNP | |
| 39. |
Deforestation ?_x005F_x000D_I- leads to localized flooding_x005F_x000D_II- reduces sustainable logging potential_x005F_x000D_III- reduces watershed stability_x005F_x000D_IV augments carbon restoration provided by forest |
| A. | I and II only |
| B. | III and IV only |
| C. | I, II and III only |
| D. | I, II , III and IV only |
| Answer» D. I, II , III and IV only | |
| 40. |
Biodiversity ? |
| A. | includes genetic species ecosystem and functional diversities |
| B. | refers to diversifying earth’s nonrenewable resource |
| C. | refers to reconstruction of tropical rainforests |
| D. | refers to biological effects on commercial plantation |
| Answer» B. refers to diversifying earth’s nonrenewable resource | |
| 41. |
An example of a transfer payment is ? |
| A. | Profit |
| B. | rent |
| C. | unemployment benefits |
| D. | government purchases |
| E. | wages |
| Answer» D. government purchases | |
| 42. |
Air pollution from automobile exhausts, and water pollution steel plants are examples of ? |
| A. | external economies |
| B. | negative externalities |
| C. | internal spillover |
| D. | social distortion |
| Answer» C. internal spillover | |
| 43. |
According to Coase’s theorem when property rights are well defined and legally enforceable and transactions costs are not prohibitive ? |
| A. | population growth leads to rigid land rights |
| B. | participants will organize their transactions |
| C. | violence displacement erosion and poverty are minimized |
| D. | individuals overuse of the biosphere is curtailed |
| Answer» C. violence displacement erosion and poverty are minimized | |
| 44. |
A higher GDP per capita may not means that the quality of life has really improved because ? |
| A. | It measures wealth not income |
| B. | It measures Gross Domestic Product |
| C. | It does not measure the quality of the items produced |
| D. | It is only measured every five years: |
| Answer» B. It measures Gross Domestic Product | |