Economics Practice MCQ Page 12

Multiple Choice questions for Economics in the sets of 10 each on one page with questions and answers. All sets are useful in the preparation of subject tests for employment or admission.
Question: 1331   Holding everything else constant ,an increase in supply leads to
  1. an increase in demand .
  2. an increase in price.
  3. an increase in quantity exchanged.
  4. a decrease in demand.
  5. a decrease in quantity supplied.
Question: 1332   Some farm land can be used to produce either corn or soybeans .If the demand for corn increase ,then
  1. the demand for soybeans should increase .
  2. the supply of soybeans should increase.
  3. the demand for soybeans should decrease.
  4. the supply of soybeans should decrease.
  5. the market for soybeans should be largely unaffected.
Question: 1333   Which of the following is not true at the equilibrium price?
  1. Quantity demanded equals quantity supplied.
  2. The supply and demand curves intersect.
  3. Consumers are satisfied with the quantity they purchase given its price.
  4. The good is not scarce.
  5. Producers are content with the price they receive for the product,given the quantity they produce.
Question: 1334   In a perfectly competitive market ,suppliers must know
  1. the incomes of consumers.
  2. the price of the good.
  3. what other commodities households could substitute for the good.
  4. consumers'expectations of the future.
  5. all of the above.
Question: 1338   Which of the following transactions would not enter the circular flow of transactions between households and firms?
  1. Your purchase of this study guide.
  2. Hiring of household maid service.
  3. The employment of janitors by your school.
  4. The purchase of paper to print this book.
  5. The rental payments of apartment dwellers.
Question: 1341   If a gallon of gasoline costs $1.10 and a can of dog food costs $.45,then the relative price of dog food in terms of gasoline is
  1. 0.45 dollars per can.
  2. 1.10 dollars per gallon .
  3. 0.45/1.10 gallons per can.
  4. 1.10/0.45 cans per gallon.
  5. 0.45*1.10 gallon per can.
Question: 1424   The relative price of houses in terms of hours of labor will surely increase if
  1. the money price of houses rises
  2. the money price of labor rises
  3. the money prices of both houses and labor rises
  4. the money price of labor falls
  5. the money price of houses rises and that of labor falls
Question: 1425   Which of the following best describes the units of measurement of the relative price of a pound of bananas in terms of gallons of gasoline?
  1. dollars
  2. dollars per pound
  3. gallons per pound
  4. pound per gallon
  5. pounds per dollar
Question: 1428   Which of the following best describes the units of measurement of the money price of bananas?
  1. Pounds.
  2. Dollars per pound.
  3. Dollars.
  4. Pounds per dollar.
Question: 1431   If the relative price of cheese in terms of labor services is 0.5 hours per pound,and the wage rate of labor is $4.50 per hour,then the money price of cheese is
  1. $2.25/ pound.
  2. $4.50/ pound .
  3. 2 pounds/hour.
  4. $9.00.
  5. 2 hours/ pound.
Question: 1434   Which of the following is primarly determined by the behavior of money prices but not relative prices.
  1. Resource-allocation decisions.
  2. Ant-inflation policy.
  3. Households 'labor-supply decisions.
  4. Firms'production decisions.
  5. All of the above are determined primarily by money prices.
Question: 1437   According to the principle of substitution.
  1. many goods have no effective substitutes .
  2. households are good substitutes for firms .
  3. nearly all goods have substitutes.
  4. the price of substitutes goods must be the same.
  5. buyers will stop buying a good if its price rises.