200+ General Economics 1 Solved MCQs

These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Bachelor of Arts in Political Science (BA political science) , Union Public Service Commission (UPSC) , Indian Administrative Service (IAS) .

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1.	The subject matter of economics is concerned with
A.	Production
B.	Consumption
C.	Distribution and exchange
D.	All of the above
Answer» D. All of the above

2.	The economic problem arises since
A.	Wants are unlimited
B.	Resources are limited
C.	Resources are capable of alternative uses
D.	All of the above
Answer» D. All of the above

3.	The wants of the people are
A.	Limited
B.	Satiable
C.	Unlimited
D.	All of the above
Answer» C. Unlimited

4.	Economic problem arises in
A.	Planned economies
B.	Free market economies
C.	Mixed economies
D.	All of the above
Answer» D. All of the above

5.	The resources are :
A.	Limited
B.	Unlimited
C.	Not only limited but are capable of alternative uses
D.	None of the above
Answer» C. Not only limited but are capable of alternative uses

6.	Which one of the following is an example of an economic good
A.	Sunlight
B.	Air
C.	Petrol
D.	None of the above
Answer» C. Petrol

7.	----- is not an example of free good
A.	Sunlight
B.	Car
C.	Petrol
D.	Computer
Answer» A. Sunlight

8.	The term production refers to:
A.	Producing things which are capable of satisfying human wants
B.	Creation or addition of utilities
C.	Transformation of inputs into output
D.	All of the above
Answer» D. All of the above

9.	The problem of allocation of resources is concerned with:
A.	What to produce
B.	How to produce
C.	For whom to produce
D.	All of the above
Answer» A. What to produce

10.	The distribution of national product among the members of the society is the problem of:
A.	What to produce
B.	How to produce
C.	For whom to produce
D.	All of the above
Answer» C. For whom to produce

11.	Production is said to be efficient when:
A.	The re-allocation of resources cannot increase the production o the article even by one unit
B.	More output is produced with the given input
C.	Resources are fully employed
D.	All of the above
Answer» A. The re-allocation of resources cannot increase the production o the article even by one unit

12.	Which one of the following come under macro economics:
A.	Per capita income
B.	Study of a firm
C.	Individual income
D.	Theory of factor pricing
Answer» A. Per capita income

13.	Which one of the following is not come under macro economics
A.	National income
B.	Per capita income
C.	Disposable income
D.	Individual income
Answer» D. Individual income

14.	Partial equilibrium analysis come under:
A.	Micro economics
B.	Macro economics
C.	Welfare economics
D.	International economics
Answer» A. Micro economics

15.	“The starting point of all economic activity is the existence of human wants” Who said this?
A.	Adam Smith
B.	Selligman
C.	Ricardo
D.	Alfred Marshall
Answer» B. Selligman

16.	Production and consumption takes place simultaneously in the case of
A.	Goods
B.	Services
C.	Both in the case of goods and services
D.	Neither in the case of goods and services
Answer» B. Services

17.	Economics is a social science because
A.	The central point in economics is man and his problems
B.	Economics uses scientific approach to derive its laws
C.	Like History, Politics and Psychology economics deals with the problems of human being
D.	All of the above
Answer» D. All of the above

18.	Economic growth can be achieved through
A.	Advanced technology
B.	Expansion of resources
C.	Both A & B
D.	Neither A & B
Answer» C. Both A & B

19.	Micro economics doesn’t deal with:
A.	The study of individual economic units
B.	Determination of factor prices
C.	Price determination of commodities
D.	General equilibrium analysis
Answer» D. General equilibrium analysis

20.	Name the economist who analyses the subject matter of economics into two branches: micro economic analysis and macro economic analysis.
A.	Adam Smith
B.	Alfred Marshall
C.	Ragner Frisch
D.	P A Samuelson
Answer» C. Ragner Frisch

21.	Transformation of inputs into outputs is known as
A.	Production
B.	Consumption
C.	Distribution
D.	Exchange
Answer» A. Production

22.	----- is an example of secondary input
A.	Land
B.	Labour
C.	Capital
D.	Raw material
Answer» D. Raw material

23.	Odd-man out from the following
A.	Steel
B.	Medicine
C.	Education
D.	Train
Answer» C. Education

24.	The choice of techniques of production is related to the problem of
A.	What to produce
B.	How to produce
C.	For whom to produce
D.	None of the above
Answer» B. How to produce

25.	The functional relationship between inputs and outputs is called
A.	Production function
B.	Consumption function
C.	Investment function
D.	Saving function
Answer» A. Production function

200+ General Economics 1 Solved MCQs

The subject matter of economics is concerned with

The economic problem arises since

The wants of the people are

Economic problem arises in

The resources are :

Which one of the following is an example of an economic good

----- is not an example of free good

The term production refers to:

The problem of allocation of resources is concerned with:

The distribution of national product among the members of the society is the problem of:

Production is said to be efficient when:

Which one of the following come under macro economics:

Which one of the following is not come under macro economics

Partial equilibrium analysis come under:

“The starting point of all economic activity is the existence of human wants” Who said this?

Production and consumption takes place simultaneously in the case of

Economics is a social science because

Economic growth can be achieved through

Micro economics doesn’t deal with:

Name the economist who analyses the subject matter of economics into two branches: micro economic analysis and macro economic analysis.

Transformation of inputs into outputs is known as

----- is an example of secondary input

Odd-man out from the following

The choice of techniques of production is related to the problem of

The functional relationship between inputs and outputs is called

Firms owned by one individual is known as

Firms owned by two or more individuals is known as

Firms owned by stock holders are known as

The major objective of a firm is

Which one of the following is an example of fixed input

In short-run

In long-run

Marginal product of a factor is

Production function expresses

The variable cost of a firm vary in direct proportion to the

Law of variable proportions is concerned with

The ‘point of inflection’ come in which stage of the law of variable proportions

A rational producer will select his level of production in which stage of the law of variable proportions

Total product reaches at maximum when

At the ‘point of inflection’

Returns to scale refers to the production function where

In the case of diminishing returns to scale, a given proportionate increase in all factors causes

Increasing returns to scale occurs due to

The cause for diminishing returns to scale is:

The solution to diminishing returns to scale is :

Economies of scale refers to:

Which one of the following is not related to economies of scale:

The law of Diminishing returns is applicable to:

Let a firm employs 5 labourers and produces 120 units of output. When 6 labourers are employed the firm produces 136 units of output. Then the marginal product is ---

A firm produces 200 units of commodity X by employing 10 workers and 240 units of the same commodity by employing 12 workers. Then the Average Product of the worker is --------

26.	Firms owned by one individual is known as
A.	Proprietorship
B.	Partnership
C.	Corporations
D.	None of the above
Answer» A. Proprietorship

29.	The major objective of a firm is
A.	Profit maximization
B.	Revenue maximization
C.	Sales maximization
D.	None of the above
Answer» A. Profit maximization

30.	Which one of the following is an example of fixed input
A.	Raw materials
B.	Casual workers
C.	Plant and equipments
D.	All of the above
Answer» C. Plant and equipments

31.	In short-run
A.	All inputs are fixed
B.	All inputs are variable
C.	Some inputs are fixed and some are variable
D.	None of the above
Answer» C. Some inputs are fixed and some are variable

33.	Marginal product of a factor is
A.	The additional product received by the firm due to the employment of an additional unit of a variable factor
B.	Addition to the total product when one more unit of a factor is employed
C.	The rate of change in the total product per unit change in the variable factor.
D.	All of the above
Answer» D. All of the above

34.	Production function expresses
A.	The relationship between input and output
B.	How maximum output is produced with the given input
C.	What is the least-cost combination of input to produce the given output
D.	All of the above
Answer» D. All of the above

35.	The variable cost of a firm vary in direct proportion to the
A.	Volume of its output
B.	Extent of its profits
C.	Volume of its sale
D.	All of the above
Answer» A. Volume of its output

36.	Law of variable proportions is concerned with
A.	Long-run production function
B.	Laws of returns to scale
C.	Short-run production function
D.	None of the above
Answer» C. Short-run production function

37.	The ‘point of inflection’ come in which stage of the law of variable proportions
A.	Stage I
B.	Stage II
C.	Stage III
D.	None of the above
Answer» A. Stage I

39.	Total product reaches at maximum when
A.	MP is increasing
B.	MP is maximum
C.	MP = 0
D.	MP is negative
Answer» C. MP = 0