Principles Of Micro Economics Set 1 MCQs

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