Economics Mcqs with solved Microeconomics and Macroeconomics questions and answers for exams like nts, spsc, ppsc  and fpsc.

Economics MCQs will help aspirants in the preparation of lecturer exams conducted by FPSC, SPSC, PPSC, NTS and other competitive exams. Besides, These Microeconomics Mcqs and Macroeconomics Mcqs questions and answers will guide students in clearing their CSS Economics paper.

Here a list Economics mcqs questions and answers are provided. 

Economics MCQs (Multiple Choice Questions)

1. Name the economist, who is known as the father of economics?

(a) J.N Keynes

(b) Alfred Marshall

(c) Adam Smith

(d) Lionel Robins

View Answer

(c) Adam Smith

2. Which of the following economist defined economics as ‘Science of Wealth’?

(a) J.N Keynes

(b) Alfred Marshall

(c) Adam Smith

(d) Lionel Robins

View Answer

(c) Adam Smith

3. According to the famous economist, Alfred Marshall, economics is concerned with the______________________.

(a) attainment and use of material requisites

(b) study of wealth

(c) science of scarcity

(d) study of determents of employment and income

View Answer

(a) attainment and use of material requisites

4. Name the economist, who defined economics as science of scarcity.

(a) J.N Keynes

(b) Alfred Marshall

(c) Adam Smith

(d) Lionel Robins

View Answer

(d) Lionel Robins

5. The study of economics is divided into how many branches?

(a) Two

(b) Three

(c) Four

(d) Five

View Answer

(a) Two

Microeconomics and Macroeconomics

6. Name the economist, who wrote the book ‘The Wealth of Nations’?

(a) J.N. Keynes

(b) Alfred Marshall

(c) Adam Smith

(d) Lionel Robins

View Answer

(c) Adam Smith

7. The branch of economics which deals it as a whole is termed as_________________.

(a) Microeconomics

(b) Macroeconomics

(c) Managerial Economics

(d) All of them

View Answer

(a) Microeconomics

8. The theory of demand establish a relationship between___________________.

(a) Price of product and its Supply

(b) The demand for a product and its Supply

(c) Price of the product and its Demand

(d) All of them

View Answer

(c) Price of the product and its Demand

9. The amount of satisfaction from a the use of a product is refered as_______________________.

(a) Utility

(b) Satisfaction

(c) Needs and Wants

(d) Equilibrium

View Answer

(a) Utility

10. Name the book written by Alfred Marshall:

(a) The Wealth of Nations

(b) Principles of Economics

(c) Study of Science of Economics

(d) Both (b) and (c)

View Answer

(d) Allam Iqbal

11. Ceteris Paribus means:

(a) All variables are independent

(b) All relationships are inverse

(c) Other things are equal

(d) That no other assumptions are made

View Answer

(c) Other things are equal

12. The basic economic problem is of________________.

(a) Inflation

(b) Unemployment

(c) Poverty

(d) Scarcity

View Answer

(d) Scarcity

13. Adam Smith was a_________________.

(a) Classical Economist

(b) Neo Classical Economist

(c) Modern Economist

(d) All of the Above

View Answer

(a) Classical Economist

14. Human wants are____________.

(a) Few

(b) Limited

(c) Unlimited

(d) One Thousand

View Answer

(c) Unlimited

15. Wealth of Nation was written by Adam Smith in____________________.

(a) 1576 A.D.

(b) 1676 A.D.

(c) 1776 A.D.

(d) 1876 A.D.

View Answer

(c) 1776 A.D.

16. What is the meaning of an economy?

(a) Study of economics

(b) A country’s economic system

(c) Domestic Trade

(d) Sources of income of a family

View Answer

(b) A country’s economic system

17. A consumer is in equilibrium when marginal utilities are___________________.

(a) Minimum

(b) Equal

(c) Highest

(d) Increasing

View Answer

(c) Highest

18. In case of negative marginal utility which of the following must be true:

(a) the average is negative

(b) the total is decreasing

(c) the total is negative

(d) the average is negative

View Answer

(b) the total is decreasing 

19. Lack of resources in relation to demand is called________________.

(a) Supply

(b) Demand

(c) Scarcity

(d) Desire

View Answer

(b) the total is decreasing 

20. A 10% decrease in the price of milk results in a 5% increase in demand. The elasticity of demand, in this case, will be: 

(a) Leeser than unity

(b) Greater than unity

(c) Equal to Unity

(d) Equal to Zero

View Answer

(a) Less than unity

21. Pakistan is ranked as_____________________.

(a) Under-developed country

(b) Developed country

(c) Industrial country

(d) Developing country

View Answer

(d) developing country

22. Exchange of goods with goods is called____________________.

(a) Barter System

(b) Monetary System

(c) Medium of Exchange

(d) Fiscal System

View Answer

(a) Barter System

23. __________________are payments of factors of producation.

(a) Money, Capital, Salaries and Income

(b) Wages, Rent, Interest and Profit 

(c) Money, Power, Prices and Wealth

(d) Wages, Interest, Salaries and Taxes

View Answer

(b) Wages, Rent, Interest and Profit

24. The reward of entrepreneur is______________.

(a) Rent

(b) Interest 

(c) Profit

(d) Wages

View Answer

(c) Profit

25. Export of services in trade is called of export of__________________. 

(a) Visible Goods

(b) Invisible Goods

(c) Basic Goods

(d) Real Goods

View Answer

(b) Invisible Goods

26. Economics is_________________.

(a) Science

(b) Art

(c) Both science as well as art

(d) None of the Above

View Answer

(c) Both science as well as art

27. Deductive Method is also known as____________.

(a) Analytical Method

(b) Abstract Method

(c) Priori Method

(d) All of the Above

View Answer

(d) All of the Above

28. Law of Demand states that_____________________.

(a) the demand for a commodity is directly proportional to its price

(b) the demand for a commodity is inversely proportional to its price

(c) The demand does not change as a result of the change in price

(d) All of the Above

View Answer

(b) the demand for a commodity is inversely proportional to its price

29. Giffen Goods are___________________. 

(a) Superior Goods

(b) Inferior Goods

(c) Average Quality Goods

(d) None of the Above

View Answer

(b) Inferior Goods

30. In the case of inferior goods the income is__________________. 

(a) Negative

(b) Positive

(c) Both (a) and (b)

(d) None of the Above

View Answer

(a) Negative

31. Who introduced the Utility Analysis of Demand?

(a) J.R. Hicks

(b) Lionel Robbins

(c) Adam Smith

(d) Alfred Marshall

View Answer

(d) Alfred Marshall

32. A perpendicular straight-line demand curve is an indication of____________________.

(a) the price may rise or fall, demand remains the same

(b) A very small reduction in price may result in an unlimited increase in demand

(c) change in price and demand move in the same proportion

(d) None of the Above

View Answer

(a) the price may rise or fall, demand remains the same

33. In Economics, land means________________.

(a) A piece of plot

(b) Soil

(c) All-natural resources that have an exchange value

(d) None of the Above

View Answer

(c) All-natural resources that have an exchange value

34. Demand Curve shows the relationship between the quantity demanded for a commodity over a given time and________________________.

(a) the tastes of the consumer

(b) the money income of the consumers

(c) the price of the related commodities

(d) the price of the commodity

View Answer

(d)  the price of the commodity

35. The impact and incidence of sales tax is_________________.

(a) on the consumer

(b) on the seller

(c) on the producer

(d) None of the above

View Answer

(a) on the consumer

36. ‘Poverty line’ is determined by________________.

(a) Per Capita Calories intake

(b) The income of the family

(c) Housing and Clothing Facilities

(d) None of the above

View Answer

(b) The income of the family

37. Money can be a standard of deferred payments only if the value of money itself__________________.

(a) Remains Stable

(b) Increase

(c) Decrease

(d) None of the above

View Answer

(a) Remains Stable

38. In monopoly at various output levels:

(a) AR = MR

(b) AR < MR

(c) AR > MR

(d) AR and MR curves are parallel

View Answer

(c) AR < MR

39. Which of the is true for the perfect market?

(a) Few buyers and few sellers

(b) Many buyers and few sellers

(c) All sellers and buyers are honest

(d) Many buyers and many sellers

View Answer

(d) Many buyers and many sellers

40. Which of the following is a capital commodity?

(a) Novel book in the library

(b) Toy of a child

(c) Calculator of the student

(d) Plough of the farmer

View Answer

(d) Plough of the farmer

41. A market demand schedule for a product indicates that____________________.

(a) as the product price falls, consumers buy less of the good

(b) there is a direct relationship between price and quantity demanded

(c) as product price rises, consumers buy less of other goods

(d) there is an inverse relationship between price and quantity demanded

View Answer

(d) there is an inverse relationship between price and quantity demanded

42. Capitalism refers to_______________.

(a) the use of markets

(b) government ownership of capital goods

(c) private ownership of goods

(d) private ownership of homes and cars

View Answer

(d) private ownership of goods

43. Human wants are_______________.

(a) More

(b) Limited

(c) Few

(d) Unlimited

View Answer

(d) Unlimited

44. Which of the following is an economic activity?

(a) Playing Cricket for fun

(b) Teaching students of village free of cost

(c) Teaching in a School on monthly salary

(d) Drinking Water

View Answer

(c) Teaching in a School on monthly salary

45. When marginal utility is zero?

(a) Total utility is zero

(b) An additional unit of consumption will decrease total utility

(c) Consumption will increase total utility

(d) Total utility is maximized

View Answer

(c) Total utility is maximized

46. After the payment of certain taxes like income tax, property tax, etc, what portion of income remains is called_________________.

(a) Gross Personal Income

(b) Total Personal Income

(c) Disposable Income

(d) Personal income at factor cost

View Answer

(c) Disposable income

47. If the value of exports exceeded imports, the balance of trade is said to be_______________.

(a) deficit 

(b) surplus

(c) favorable

(d) unfavorable

View Answer

(c) favorable

48. ___________________records transactions between domestic residents and rest of the world.

(a) Balance of Trade

(b) Balance of Payments

(c) Current Account

(d) Capital Account

View Answer

(a) Balance of Trade

49. A moderate degree of controlled inflation is called_________________.

(a) Stagflation

(b) Reflation

(c) Deflation

(d) Stagnation

View Answer

(b) Reflation

50. The process of rising prices in an economy is called__________________.

(a) Inflation

(b) Disinflation

(c) Deflation

(d) Stagnation

View Answer

(a) Inflation

51. Per capita income is:

(a) Income per worker

(b) Income per head

(c) Income per household

(d) Income per industrial unit

View Answer

(b) Income per head

52. The purchasing power of money during deflation is_______________________.

(a) reduced

(b) increased

(c) constant

(d) flactuating

View Answer

(b) Increased

53. According to the Keynes, demand for money is affected by:

(a) Income

(b)Rate of interest

(c) literacy rate

(d) Both (a) and (b)

View Answer

(d) Both (a) and (b)

54. Balance of payment of a country includes:

(a) current account

(b) monetary account

(c) capital account

(d) All of the Above

View Answer

(d) All of the Above

55. Pakistan’s per capita income is less than_______________.

(a) Japan

(b) India

(c) Korea

(d) All of the Above

View Answer

(d) All of the Above

56. Transfer payments means:

(a) Bank Loan

(b) The payment without work

(c) Tax Payments

(d) Payments made to all factors

View Answer

(b) the payment without work

57. Which is the largest figure:

(a) NNP

(b) GNP

(c) DPI

(d) PI

View Answer

(b) GNP

58. If no money is used to exchange goods, it is called___________________.

(a) Barter

(b) Currency

(c) Black market

(d) free trade

View Answer

(a) Barter

59. The most important feature of money is:

(a) general Acceptability

(b) convertibility into gold

(c) store of value

(d) medium of exchange

View Answer

(a) general acceptibility

60. Inflation can be controlled by applying:

(a) Monetary and Fiscal Policies

(b) Monetary and Labour Policy

(c) Fiscal and Commercial Policy

(d) All of the Above

View Answer

(a) Monetary and Fiscal Policy

61. Export of services is called trade in__________________.

(a) Visible Goods

(b) Invisible Goods

(c) Basic Goods

(d) Non-Real Goods

View Answer

(b) Invisible Goods

62. David Ricardo presented the theory of international trade called______________.

(a) Theory of Absolute Advantage

(b) Theory of Total Advantage 

(c) Theory of Equal Advantage

(d) Theory of Comparative Advantage

View Answer

(d) Theory of Comparative Advantage

63. Theory of Absolute Advantage was presented by:

(a) Ricardo

(b) Marshall

(c) Adam Smith

(d) Hicks

View Answer

(c) Adam Smith

64. Which of the following is a direct tax?

(a) Excise Tax

(b) Sales Tax

(c) Income Tax

(d) Custome Duty

View Answer

(c) Income Tax

65. A tax in which the initial money burden and the final burden of the tax is on the same person is called__________________.

(a) Direct Tax

(b) Progressive Tax

(c) Indirect Tax

(d) Regressive Tax

View Answer

(a) Direct Tax

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