Economics Practice MCQ Page 8

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: 1190   If a household 's income is $900,the price of compact discs(on the vertical axis) is $15,and the price of cassette tapes(on the horizontal axis) is $10,then budget line intersects the vertical axis at a value of
  1. 900
  2. 15
  3. 60
  4. 80
  5. an indeterminate magnitude based on the data given.
Question: 1191   The absolute value of the slope of the budget line in the previous problem is
  1. 15.
  2. 10.
  3. 1.5.
  4. 0.67.
  5. impossible to determine from the data given.
Question: 1196   The concept of property rights in an economic system has to do with the
  1. ownership of society's productive resources.
  2. choices firms make on what and how to produce.
  3. use of economic incentives to motivate people.
  4. use of moral incentives to motivate people.
Question: 1198   In China during the early 1990s.
  1. two-fifth of state enterprise lost money.
  2. the private sector produced less than 5 percent of total output.
  3. there has been a shift of population from cities to rural areas.
  4. the decision was made to eliminate subsides to inefficient industries.
Question: 1199   An apparently irreversible trend in China in the 1990s is
  1. reliance on moral incentives to encourage private production.
  2. a movement to allow individual state-run banks to print their own money.
  3. a shift from public to private production of goods and services.
  4. to allow Japan to operate major Chinese industries.
Question: 1200   Market allocation fundamentally relies upon
  1. a system of relative prices.
  2. a belief that employees work for the good of society.
  3. government ownership of the means of production.
  4. moral incentives to encourage productive efficicency.
Question: 1201   Karl Marx believed that in the transitory socialist phase of an economy's evolution,people should rewarded
  1. so that all incomes would be equal.
  2. to each according to their contribution.
  3. to each according to their need.
  4. so that people were all poor and would thus work harder.
Question: 1203   Karl Marx belief that communism would eventually replace capitalism was based upon his faith in
  1. the superiority of economic over moral incentives.
  2. a revolution by exploited workers.
  3. overconsumption by the working class that would bankrupt the economy .
  4. the inability of factory owners to increase exploitation of workers.
Question: 1206   The amount of change in quantity demanded that will result from a given change in price (due ti a shift in supply)is determined by
  1. how far to the left the demand curve is ..
  2. how price-elastic demand is .
  3. how price-elastic supply is .
  4. how income -elastic demand is .
  5. how elastic demand is to other prices.8
Question: 1208   The collection of the price elasticity of demand is computed as the absolute value of the percentage change in quantity demanded divided by
  1. the change of price.
  2. the change in supply.
  3. the percentage change in supply .
  4. the percentage change in quantity supplied.
  5. the percentage change in price.
Question: 1209   The coefficient of the price elasticity of demand is
  1. negative as long as the law of demand holds.
  2. always negative or zero .
  3. always positive or zero.
  4. positive only when the supply curve slopes upward.
  5. sometimes positive and sometimes negative.
Question: 1211   Demand is elastic when
  1. the coefficient of elasticity is great than zero.
  2. the coefficient of elasticity is less than one .
  3. the coefficient of elasticity is negative.
  4. the coefficient of elasticity is greater than one.
  5. the demand curve is steeper than forty -five degrees.