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This set of Principles of Micro Economics Multiple Choice Questions & Answers (MCQs) focuses on Principles Of Micro Economics Set 1
Q1 | The curve showing the possibilities of production of desired good is known as:
- indifference curve
- production possibility curve
- revealed preference curve
- none of these
Q2 | Which one of the following definition of Economics is associated with the nameof Lionel Robbins?
- welfare definition
- scarcity definition
- growth definition
- wealth definition
Q3 | A hypothesis is tested by:
- the realism of its assumptions
- the lack of realism of its assumptions
- its ability to predict accurately an outcome that follows logically from the assumptions
- none of these
Q4 | In a free enterprise economy, the problems of what, how and for whom toproduce are solved by :
- a planning committee
- the price mechanism
- the planning commission
- none of these.
Q5 | Who considered Political Economy as “an enquiry into the nature and causes ofthe wealth of nations”?
- adam smith
- j.b.say
- marshall
- keynes
Q6 | Which of the following definitions of Economics include the economic conceptof ‘scales of Preferences’?
- wealth definition
- welfare definition
- scarcity definition
- growth definition
Q7 | Which of the following embodies a more widely accepted definition ofeconomics?
- science of material welfare
- science of wealth
- a study of mankind in the ordinary business of life
- science of making choice.
Q8 | The fundamental problem faced by an economy is one of :
- exchange
- decision making by the government
- economic welfare
- scarcity of resources and multiplicity of wants.
Q9 | Production possibilities curve does not show:
- what to produce
- how to produce
- for whom to produce
- productive potential under conditions of underemployment
Q10 | State whether Economics is :
- a positive science only
- neither a positive science
- a science but not art
- a science or an art depending on who uses economics and for what purpose.
Q11 | Who of the following emphasized the normative aspect of Economics as ascience?
- the english classical school
- lionel robbins
- the german historical school
- none of these.
Q12 | Of the following economists who is considered as master of partial analysis?
- alfred marshall
- a.c.pigou
- j.m.keynes
- j.s.mill.
Q13 | Which of the following statements has been drawn by inductive method?
- a consumer will buy from the cheapest market
- all businessmen wish to buy at low price and sell at high price
- a private firm will try to maximize its profits
- the larger the stock of money with a person, the lower is the utility that he
Q14 | What is true for deductive method?
- abstract
- realistic
- economic conditions assumed to be changing
- supported by historical school.
Q15 | What is true for inductive method?
- hypothetical
- empirical
- ignores experimentation
- static
Q16 | Find out the correct statement:
- prediction of economic models cannot be refuted by empirical evidence
- models transform verbal expressions in to more scientific expressions
- models make no assumptions
- economic models are comprehensive and not partial
Q17 | Micro economic theory studies how a free enterprise economy determines:
- the price of goods
- the price of services
- the price of resources
- all of these.
Q18 | Which aspect of taxation involves normative economics?
- the incidence of the tax
- the fairness of the tax
- the effect of the tax on incentives to work
- all of the above
Q19 | Microeconomics deals primarily with:
- comparative statics, general equilibrium and positive economics
- comparative statics, partial equilibrium and normative economics
- dynamics, partial equilibrium and positive economics
- comparative statics, partial equilibrium and positive economics.
Q20 | Which of the following is incorrect?
- microeconomics is concerned primarily with the problem of what , how and for whom to produce
- microeconomics is concerned primarily with the economic behavior of individual decision making units when at equilibrium
- microeconomics is concerned primarily with the time path and processes by which one equilibrium position evolves into another
- microeconomics is concerned primarily with comparative statics rather than dynamics.
Q21 | Which of the following statements is most closely associated with generalequilibrium analysis?
- everything depends on everything else
- the equilibrium price of a factor depends on the balancing of the forces of demand and supply for that factor
- the equilibrium price of a good or service depends on the balancing of the forces of demand and supply for that good or service
- none of these
Q22 | The meaning of the word ‘economic’ is most closely associated with the word:
- free
- scarce
- unlimited
- unrestricted
Q23 | The market equilibrium for a commodity is determined by
- the market demand for the commodity
- the market supply of the commodity
- the balancing of the forces of demand and supply for the commodity
- any of these
Q24 | Microeconomics studies the decision making behavior of:
- society as a whole
- an individual or household
- a group of individuals
- economy as a whole
Q25 | The word micro was first used in Economics by:
- keynes
- ragnar frisch
- j.r.hicks
- marshall