Elements of Economic Theory Mcqs

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SEMESTER - 1

ELEMENTS OF ECONOMIC THEORY

(EET)

MCQS - 2018

1. Tea, Coffee, Soap and Milk are _________ goods. 

A. Producers 

B. Non-durable 

C. Durable  

D. Capital 

2. Dissimilar units of good consumed, Very small units of good consumed, Too long intervals in consumption of successive units of the good result in Inapplicability of  

A. Producer's surplus 

B. Law of Supply 

C. Consumer surplus 

D. Law of Diminishing Utility 

3. The formula of Point elasticity of demand _________ of the demand curve. 

A. Upper segment/Lower segment 

B. Upper segment+ Lower segment 

C. Lower segment /Upper segment 

D. Lower segment-Upper segment 

4. Given the two statements, choose the correct option:  

(I) Value in use and value in exchange are the same 

(II) Value and Price are the same 

A. Statement (I) is True and Statement (II) is False

B. Statement (i) is True and Statement (II) is True 

C. Statement (I) is False and Statement (ii)

is True 

D. Statement (I) is False and Statement (II) is False

5. The fundamental economic problem faced by all societies is:  

A. Unemployment 

B. Poverty 

C. Scarcity 

D. Inequality 

6. To which of these can the terms 'Primary' and 'Secondary' be applied? 

A. Types of Wants 

B. Production possibility curve 

C. Value 

D. Utility 

7. Read the following statements.  

i. Variables refer to different points of time 

ii. The entire process of change is traced 

iii. Supply in time period t+1 is a function of Price in time period t 

The above statements have reference to 

A. Static approach of economic analysis

B. Stock concept

C. Equilibrium analysis

D. Dynamic approach of economic analysis

8. Under law of DMU, when MU becomes negative, TU _________. 

A. Decreases 

B. Becomes negative 

C. Increases 

D. Remains Constant 

9. When change in price leads to less change in demand in the relative sense, the elasticity of demand is ________.  

A. Ed<1 

B. Ed>1 

C. Ed=1 

D. Ed=0 

10. When Income of a consumer increases, demand of __________ goods decreases. 

A. Inferior 

B. Luxury 

C. Veblen 

D. Normal 

11. A reasoning where we start with certain particular statements and conclude with a universal statement is called 

A. Inductive Reasoning 

B. Deductive Reasoning  

C. Static Reasoning 

D. Dynamic Reasoning 

12. If the demand curve of a commodity is parallel to Y axis then it shows 

A. highly elastic demand  

B. perfectly elastic demand 

C. perfectly inelastic demand  

D. unitary elastic demand 

13. Goods that are common to all and are collectively owned by society are called 

A. intermediary goods  

B. consumer goods 

C. social goods 

D. luxury goods 

14. The defects in Robbins definition has been sought to be removed by the definition given by _________. 

A. Adam Smith  

B. Alfred Marshall 

C. Samuelson  

D. Ricardo  

15. Other things remaining constant, a change in the price of a commodity causes the quantity purchased of its complements 

A. to be least affected  

B. to move in the same direction 

C. to be indeterminate 

D. to move in the opposite direction 

16. Which of the following is an economic activity? 

A. Teacher teaching in the school 

B. Teacher teaching his son at home 

C. Children playing in the playground 

D. Growing vegetables in one's kitchen garden 

17  What does a point outside the production possibility curve represent? 

A. A currently unattainable position 

B. An inefficient position 

C. The maximum use of resources  

D. Unused resources  

18. _________ refers to the demand with its immediate reaction to price changes, income fluctuations, product launches, etc. 

A. Market demand 

B. Short run demand 

C. Autonomous demand 

D. Long run demand 

19. Any commodity to have exchange value must possess three attributes:  

A. Utility, scarcity, transferability  

B. Ubility, abundance, marketability 

C. Pleasure, satisfaction, usefulness 

D. Satisfaction, price, transferability 

20. For the pair of substitute goods, if there is a change in price of one commodity (Good X), then other things remaining constant, the change in the quantity demanded of Good Y   

A. will be in the same direction of the price change in Good X  

B. will be nil 

C. will be in the opposite direction of the price change in Good X 

D. cannot be determined 

21. The definition of economics given by Prof. Samuelson is also known as Science of _________. 

A. Choice  

B. Scarcity   

C. Dynamic Growth And Development 

D. Welfare 

22. The root of economic problem is _________. 

A. Ends 

B. Means 

C. Scarcity  

D. Abundance 

23. An inferior good is one for which an increase in income causes a  

A. Decrease in demand 

B. Increase in demand 

C. Decrease in supply 

D. Increase in supply 

24. Which of the following statement is true for Economic Statics?  

A. It is realistic 

B. It is more complex than dynamic economics 

C. It requires techniques of advanced mathematics 

D. It ignores time element 

25. An increase in supply of a commodity at the existing price may be caused by  

A. Increase in income of the consumer  

B. Improvement in technology 

C. Fall in price of related goods 

D. Fall in price of the good 

26. Which law has been derived from the Law of Diminishing Marginal Utility?  

A. Law of diminishing returns to factor 

B. Law of demand 

C. Law of Consumption 

D. Law of Supply 

27. Marshall's definition of economics is a _________ centric definition. 

A. Goods 

B. Wealth 

C. Scarcity  

D. Man 

28. Marginal Utility depends upon:  

A. Quantity of consumption 

B. Price 

C. Type of commodity 

D. Income 

29. According to Robbins, Economics is a _________. 

A. Normative Science  

B. Positive Science  

C. Natural Science 

D. Social Science 

30. Contraction of supply is the result of 

A. Decrease in the number of producers 

B. Increase in the price of the good  

C. Decrease in population 

D. Decrease in the price of the good 

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