MCQ Questions on Economics

MCQ Questions on Economics

1- Price elasticity of demand is defined as

(A) percentage change in rupee demanded divided by percentage change in rupee.

(B) percentage change in supply demanded divided by percentage change in supply

(C) percentage change in money demanded divided by percentage change in price

(D) percentage change in quantity demanded divided by percentage change in price


2- The cross-elasticity of demand between the two substitute goods is

(A) Positive

(B) Negative

(C) Zero

(D) Positive and Negative


3- Factor – Product relationship refers to

(A) Law of diminishing returns

(B) Law of equal returns

(C) Law of constant returns

(D) Law of increasing returns


4- Cluster sampling is

(A) Probability sampling method

(B) Same as convenience sampling

(C) Same as judgement sampling

(D) A non-probability sampling method


5- Giffen Goods are an exemption to the following law :

(A) Law of Equi-marginal Utility

(B) Law of Demand

(C) Principle of Maximum Social Advantage

(D) Law of Supply


6- Homogeneous products is one of the important features of the following market :

(A) Perfect Competition

(B) Duopoly

(C) Monopolistic Competition

(D) Monopoly


7- In accounting profit the following is not included

(A) Marginal cost

(B) Variable cost

(C) Indirect cost

(D) Direct cost


8- Devaluation is a process of

(A) Reducing the internal value of home currency

(B) Decreasing the value of the foreign currency

(C) Demonetising certain currency notes

(D) Reducing the external value of the home currency


9- What is Monoculture?

(A) Repeated Cultivation of same crop

(B) Growing single crop

(C) Growing multiple crop

(D) Cultivation traditional method


10- What is Monopoly?

(A) Two Producer

(B) Single Producer

(C) Producer Group

(D) Competitor Group


11- National Income means

(A) Net National Product

(B) Value of Total Production

(C) Total value of Goods and Services at market price

(D) None of these


12- Parallel Economy means

(A) Short term Economy

(B) Incharge Economy

(C) Unauthorised Economy

(D) None of these


13- Black Money means

(A) Deposited in Foreign Bank

(B) Safe locker money

(C) Invisible money

(D) None of these


14- Barter system means

(A) Exchange goods for goods

(B) Value based system

(C) Currency system

(D) None of these


15- Total utility is maximum when

(A) Average utility is at its maximum

(B) Marginal utility is equal to average utility

(C) Marginal utility at its highest point

(D) Marginal utility is zero


16- The concept of consumer’s surplus relates to

(A) Consumer’s purchasing power

(B) Consumer’s extra satisfaction

(C) Consumer’s earnings

(D) Consumer’s savings


17- Transfer payments refers to payments which are made

(A) compensation to employees

(B) to workers form on transfer from one job to another

(C) without any exchange of goods and services

(D) None of these


18- Cotton is desired for many purposes. It represents a case of

(A) Composite supply

(B) Joint supply

(C) Composite demand

(D) Joint demand


19- Which of the following is a selling cost?

(A) Expenditure on wages

(B) Expenditure on transport

(C) Expenditure on advertising

(D) Expenditure on Packing


20- The extent of market depends upon

(A) Trade policy

(B) Transport and communication

(C) Nature of the commodity

(D) All of these



1-(D), 2-(A), 3-(C), 4-(A), 5-(B), 6-(A), 7-(A), 8-(D), 9-(B), 10-(B), 11-(C), 12-(C), 13-(C), 14-(A), 15-(D), 16-(B), 17-(C), 18-(C), 19-(A), 20-(D)