ECO401 Economics MCQS virtual University

ECO401 Economics MCQS virtual University.eco401 midterm solved mcqs papers by moaaz.eco401 finalterm solved mcqs papers by moaaz

Q: If the price elasticity of demand for beans is estimated to be -0.4, then a 20% increase in price will decrease the quantity demanded by:?

A. 14%
B. 8%
C. 16%
D. 20%


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Q: When we study market equilibrium, the primary influencing variable on production and purchasing decisions is:?

A. Price
B. Cost of production
C. The overall state of the economy
D. Consumer’s income


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Q: If one firm increases its price, in the kinked demand curve model then:?

A. Other firms will reduce their price.
B. Other firms will compete on a non-price basis.
C. Other firms will not increase their price.
D. Other firms will increase their output level.


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Q: When producers are unable to meet market demand for the product, this results as:?

A. Surplus of goods
B. Market failure
C. Monopoly
D. Shortage of good


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Q: The break-even point occurs when:?

A. Price < Average Variable Cost.
B. Price < Average Total Cost.
C. Price = Average Total Cost.
D. Price > Average Variable Cost.


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Q: If the cost of parts of automobiles falls, then: ?

A. The demand curve for automobiles shifts to the right.
B. The supply curve for automobiles shifts to the right.
C. The demand curve for automobiles shifts to the left.
D. The supply curve for automobiles shifts to the left.


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Q: Arifa in her recent address in National assembly said that poverty should be reduced in Pakistan. Which category her statement falls in??

A. Normative
B. Positive
C. Negative
D. None of the given


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Q: Ali has 1 acre land in Bahawalpur. He grows wheat on this land by employing 10 workers. To get maximum output, he decides to increase number of workers. The law of diminishing returns states that as more workers are employed to grow wheat on 1 acre land:?

A. Marginal utility of wheat falls
B. The total physical product of wheat falls
C. The marginal physical product of wheat falls
D. The marginal physical product of wheat increases


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Q: If a 2% rise in consumer’s incomes causes a 4% rise in product’s demand, the income elasticity of demand for the product will be:?

A. 0.5
B. 1.5
C. 2
D. 2.5


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Q: Demand is elastic when the elasticity of demand is:?

A. Greater than 0
B. Greater than 1
C. Less than 1
D. Less than 0


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