Managerial Economics Solved MCQs

1.

Which of the following statements is NOT TRUE of indifference curves?

A. they could intersect
B. they are convex to origin
C. they are
D. they exhibit higher levels of utility d. as you move from the origin
Answer» B. they are convex to origin
2.

A consumer with a given income will maximise their utility when:

A. the marginal utility derived from each commodity is equal.
B. the marginal utility derived from each product consumed is zero.
C. the total utility derived from each commodity consumed is equal.
D. the marginal utilities derived from each commodity consumed are proportional
Answer» D. the marginal utilities derived from each commodity consumed are proportional
3.

The typical indifference curve ……..

A. shows that as a consumer has more of a good he/she is less willing to exchange it for one unit of another good.
B. shows all combinations of goods that give a consumer in same level of utility
C. shifts out if income increases
D. both b and c
Answer» B. shows all combinations of goods that give a consumer in same level of utility
4.

The rate at which a consumer is able to substitute one good for another is determined by the …….

A. consumers income
B. indifference map
C. ratio of the prices of the goods
D. marginal rate of substitution.
Answer» C. ratio of the prices of the goods
5.

A utility function shows the relation between …..

A. the amount of goods consumed and a consumer utility.
B. income and a consumer utility.
C. prices and consumers utility.
D. maximum utility and the price and income facing a consumer.
Answer» A. the amount of goods consumed and a consumer utility.
6.

Which of the following is the measure to control inflation.

A. granting credit on liberal terms
B. raising bank rate
C. demonetization
D. none of these
Answer» B. raising bank rate
7.

Which of the following is a measure to reduce inequality of income

A. promotion of industries
B. social securities
C. granting of credit to poor on concessional rate
D. none of these
Answer» B. social securities
8.

The most outstanding feature of capitalist economic system is …

A. unemployment
B. poverty
C. inequality of income
D. industrial backwardness
Answer» C. inequality of income
9.

Employment of people who take jobs below their capacity is known as

A. underemployment
B. disguised unemployment
C. cyclical unemployment
D. none of these
Answer» A. underemployment
10.

Which of the following is a social consequences of unemployment in india

A. burden on the government
B. loss of income and respect
C. wastages of resources
D. none of these
Answer» B. loss of income and respect
11.

Unemployment caused by a decline in demand for production in a particular industry is

A. seasonal unemployment
B. frictional unemployment
C. structural unemployment
D. none of these
Answer» C. structural unemployment
12.

Which of the following is not a development issue in india

A. unemployment
B. population pressure
C. inflation
D. decreasing trend of foreign capital
Answer» D. decreasing trend of foreign capital
13.

Indian economy growth is primarily driven by

A. industry
B. agriculture
C. service
D. none of these
Answer» C. service
14.

Law of equi-marginal utility was suggested by

A. marshal
B. robins
C. hh ghosen
D. none of these
Answer» B. robins
15.

The concept of consumer surplus was developed by

A. marshal
B. hh ghosen
C. bhentham
D. none of these
Answer» A. marshal
16.

Indifference curve analysis is based on the principles of

A. consumer surplus
B. diminishing marginal utility
C. diminishing marginal rate of substitution
D. none of these
Answer» C. diminishing marginal rate of substitution
17.

The author of the wealth of nation is

A. marshal
B. robins
C. adam smith
D. none of these
Answer» C. adam smith
18.

Macro economic theory is also known as

A. price theory
B. income theory
C. demand theory
D. none of these
Answer» A. price theory
19.

The study of entire economic system is called

A. macro economics
B. micro economics
C. economics
D. none of these
Answer» A. macro economics
20.

The author of “the wealth of nations” is

A. marshal
B. ricardo
C. robins
D. adam smith
Answer» D. adam smith
21.

The study of international trade and national income is part of

A. global economics
B. macro economics
C. positive economics
D. micro economics
Answer» B. macro economics
22.

If the income elasticity of demand is that one, the good is a

A. necessity
B. luxury
C. substitute
D. complement
Answer» B. luxury
23.

The income elasticity of demand is negative for a

A. positive good
B. normal good
C. elastic good
D. inferior good
Answer» D. inferior good
24.

If the price of DVRs fell and as a result the demand for VHS recorders fell we could conclude that VHS recorders DVRs are

A. normal goods
B. substitutes
C. elastic goods
D. unrelated
Answer» B. substitutes
25.

What effect is working when the price of a good falls and consumers tend to buy it instead of other goods

A. income effect
B. substitution effect
C. price effect
D. none of these
Answer» B. substitution effect
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