Explore topic-wise MCQs in Economics Mcqs.

This section includes 80 Mcqs, each offering curated multiple-choice questions to sharpen your Economics Mcqs knowledge and support exam preparation. Choose a topic below to get started.

51.

For a normal good ?
A. The price elasticity of demand is negative the income elasticity of demand is negative
B. The price elasticity of demand is positive the income elasticity of demand is negative
C. The price elasticity of demand is negative the income elasticity of demand is positive
D. The price elasticity of demand is positive; the income elasticity of demand is positive
Answer» D. The price elasticity of demand is positive; the income elasticity of demand is positive
Discussion
52.

The Setrite Corporation produce chairs. An economist working for the firm predicts that if people’s incomes rise next year, then the demand for our chairs will for our chairs will increase ceteris paribus The accuracy of the economist’s prediction depends on whether the chairs Setrite Produce ?
A. have few substitutes.
B. are normal goods
C. have few complementary goods.
D. have many complementary goods.
Answer» C. have few complementary goods.
Discussion
53.

Which best describes a demand curve ?
A. the quantity consumers would like to buy in an ideal world
B. The quantity consumers are willing to sell
C. The quantity consumers are willing and able to buy at each and every income all other things unchanged
D. The quantity consumers are willing and able to buy each and every price all other things changed
Answer» E.
Discussion
54.

The price of burgers increase by 22% and the quantity of burgers demanded falls by 25% This indicates that demand for burgers is ____________?
A. elastic
B. perfectly elastic
C. unitarily elastic
D. inelastic
Answer» B. perfectly elastic
Discussion
55.

The price elasticity of demand is the ?
A. ratio of the change in price to the change in quantity demanded.
B. ratio of the percentage change in quantity demanded to the percentage change in price.
C. ratio of the change in quantity demanded to the change in price.
D. ratio of the percentage change in price to the percentage change in quantity demanded.
Answer» C. ratio of the change in quantity demanded to the change in price.
Discussion
56.

An increase in the price of a complement for product A would ?
A. Shift demand for Product A outwards
B. Shift demand for product A inwards
C. Shift supply for product A outwards
D. Shift supply for product A inwards
Answer» C. Shift supply for product A outwards
Discussion
57.

Increased levels of spending on imports ?
A. shift aggregate supply to the right
B. shift aggregate supply to the left
C. shift aggregate demand to the right
D. shift aggregate demand to the left
Answer» E.
Discussion
58.

Which best describes a supply curve ?
A. The quantity consumers would like to buy in an ideal world
B. The quantity producers are willing and able to sell at each and every price all other things unchanged
C. The quantity producers are willing and able to sell at each and every income all other things unchanged
D. The quantity producers are willing and able to sell at each and every point in time all other things unchanged
Answer» C. The quantity producers are willing and able to sell at each and every income all other things unchanged
Discussion
59.

Price increases from 10 to 12 pence and the price elasticity of demand is -0.5 The quantity demanded was 500 units. What will it be now ?
A. 550 units
B. 500 units
C. 450 units
D. 490 units
Answer» D. 490 units
Discussion
60.

If demand is __________ then price cuts will _________ spending?
A. inelastic; increase
B. elastic; increase
C. elastic, decrease
D. none of the above
Answer» C. elastic, decrease
Discussion
61.

For an inferior good ?
A. The price elasticity of demand is negative: the income elasticity of demand is negative
B. The price elasticity of demand is positive the income elasticity of demand is negative
C. The price elasticity of demand is negative the income elasticity of demand is positive
D. The price elasticity of demand is positive the income elasticity of demand is positive
Answer» B. The price elasticity of demand is positive the income elasticity of demand is negative
Discussion
62.

If the price elasticity of demand is unit then a fall in price ?
A. Reduces revenue
B. Leaves revenue unchanged
C. Increase revenue
D. Reduces costs
Answer» C. Increase revenue
Discussion
63.

The income elasticity is +2 and income increases by 20% sales were 5000 units, what will they be now ?
A. 3000
B. 7000
C. 5500
D. 4500
Answer» C. 5500
Discussion
64.

Average income increase from Rs20,000 p.a to Rs 22,000 p.a Quantity demanded per year increases 5000 to 6000 units. Which of the following is correct ?
A. Demand is price inelastic
B. The good is inferior
C. Income elasticity is -2
D. The product is normal
Answer» E.
Discussion
65.

If a product is a vablen good ?
A. Demand is inversely related to income
B. Demand is inversely related to price
C. Demand is directly related to price
D. Demand is inversely related to the price of substitutes
Answer» D. Demand is inversely related to the price of substitutes
Discussion
66.

Increase unemployment benefits and less incentive to work would ?
A. shift aggregate supply to the right
B. shift aggregate supply to the left
C. shift aggregate demand to the right
D. shift aggregate demand to the left
Answer» B. shift aggregate supply to the left
Discussion
67.

The law of demand implies that ?
A. as prices rise, demand decrease
B. as prices fall, quantity demanded increase
C. as prices fall demand increases
D. as prices rise, quantity demanded increases
Answer» C. as prices fall demand increases
Discussion
68.

Supply is likely to be more price elastic ?
A. In the short run rather than the long run
B. If factors of production are relatively immobile between industries
C. If there are very few producers
D. If it is easy to expand output
Answer» E.
Discussion
69.

If marginal utility is zero ?
A. Total utility is zero
B. An additional unit of consumption will decrease total utility
C. An additional unit of consumption will increase total utility
D. Total utility is maximized
Answer» E.
Discussion
70.

What effect is working when the price of a good falls and consumers tend to buy it instead of other goods ?
A. The ceteris paribus effect
B. The diminishing marginal utility effect
C. The substitution effect
D. The income effect
Answer» D. The income effect
Discussion
71.

Demand curves are derived while holding constant ?
A. incomes, tastes, and the price of other goods
B. income, tastes, and the price of the good
C. income and tastes
D. tastes and the price of other goods
Answer» B. income, tastes, and the price of the good
Discussion
72.

Suppose the demand for good Z goes up when the price of good Y goes down. We can say that goods Z and Y are ?
A. perfect substitutes
B. complements
C. unrelated goods
D. substitutes
Answer» C. unrelated goods
Discussion
73.

Which of the following will NOT cause a shift in the demand curve for compact discs ?
A. A change in wealth
B. A change in the price of compact discs
C. A change in income.
D. A change in the price of pre-recorded cassette tapes
Answer» C. A change in income.
Discussion
74.

The price of computer chips used in the manufacture of personal computers has fallen. This will lead to _________ personal computer?
A. a decrease in the quantity supplied of
B. a decrease in the supply of
C. an increase in the quantity supplied of
D. an increase in the supply of
Answer» E.
Discussion
75.

Which of the following would decease aggregate demand ?
A. increase consumption
B. increasing export revenue
C. increased taxation revenue
D. increased investment
Answer» C. increased taxation revenue
Discussion
76.

Demand for a normal product may shift outwards if ?
A. Price decreases
B. The price of a substitute falls
C. The price of a complement rises
D. income falls
Answer» C. The price of a complement rises
Discussion
77.

An increase in aggregate demand will have most effect on prices if ?
A. Aggregate supply is price inelastic
B. Aggregate supply is price elastic
C. Aggregate supply has a unitary price elasticity
D. Aggregate demand is price inelastic
Answer» C. Aggregate supply has a unitary price elasticity
Discussion
78.

An increase in price from 25 pence to 30 pence leads to an increase in the quantity supplied from 40 units to 44 units. The price elasticity of supply is ?
A. +2
B. +0.5
C. -2
D. -0.5
Answer» C. -2
Discussion
79.

A shift in aggregate supply is likely to ?
A. Reduce the general price level and reduce national income
B. Reduce the general price level and increase national income
C. Increase the general price level and reduce national income
D. Increase the general price level and increase national income
Answer» B. Reduce the general price level and increase national income
Discussion
80.

A contraction in supply occurs when ?
A. Demand shifts outwards
B. The supply curve shifts inwards
C. The quantity supplied falls when the price falls
D. The supply curve shifts outwards
Answer» D. The supply curve shifts outwards
Discussion