### 1. Basic Economic Concepts
Q: The central problem of Economics is:
A) Inflation
B) Unemployment
C) Scarcity of resources
D) Economic growth
Answer: C) Scarcity of resources
### 2. Demand and Supply
Q: If the price elasticity of demand for a good is greater than 1, the demand is said to be:
A) Perfectly inelastic
B) Inelastic
C) Elastic
D) Unitary elastic
Answer: C) Elastic
### 3. Theory of Consumer Behavior
Q: The Indifference Curve represents:
A) Different combinations of two goods providing the same level of satisfaction
B) Relationship between income and expenditure
C) Relationship between price and quantity demanded
D) Cost minimization in production
Answer: A) Different combinations of two goods providing the same level of satisfaction
### 4. Production and Costs
Q: The Law of Diminishing Returns states that:
A) Increasing all inputs leads to increasing output
B) Adding more of one input, while keeping others constant, will eventually result in decreasing additional output
C) The total production remains constant regardless of inputs
D) A firm can produce unlimited output with limited resources
Answer: B) Adding more of one input, while keeping others constant, will eventually result in decreasing additional output
### 5. Market Structures
Q: Price discrimination is possible in which market structure?
A) Perfect competition
B) Monopoly
C) Oligopoly
D) Monopolistic competition
Answer: B) Monopoly
### 6. National Income Accounting
Q: Net National Product (NNP) is calculated as:
A) GDP + Depreciation
B) GDP - Depreciation
C) GNP + Depreciation
D) GNP - Depreciation
Answer: D) GNP - Depreciation
### 7. Money and Banking
Q: The money multiplier is determined by:
A) The central bank’s interest rate
B) The reserve requirement ratio
C) The level of inflation
D) The fiscal deficit
Answer: B) The reserve requirement ratio
### 8. Inflation and Unemployment
Q: According to the Phillips Curve, there is a trade-off between:
A) Inflation and unemployment
B) Money supply and interest rates
C) GDP and fiscal deficit
D) Imports and exports
Answer: A) Inflation and unemployment
### 9. Fiscal Policy and Public Finance
Q: A budget deficit occurs when:
A) Government revenue exceeds government expenditure
B) Government expenditure exceeds government revenue
C) Tax revenue is equal to government spending
D) Exports exceed imports
Answer: B) Government expenditure exceeds government revenue
### 10. International Trade
Q: The Balance of Payments (BOP) consists of:
A) Current account, capital account, and financial account
B) Exports and imports only
C) Only foreign direct investment
D) Only remittances from abroad
Answer: A) Current account, capital account, and financial account
Q: The central problem of Economics is:
A) Inflation
B) Unemployment
C) Scarcity of resources
D) Economic growth
Answer: C) Scarcity of resources
### 2. Demand and Supply
Q: If the price elasticity of demand for a good is greater than 1, the demand is said to be:
A) Perfectly inelastic
B) Inelastic
C) Elastic
D) Unitary elastic
Answer: C) Elastic
### 3. Theory of Consumer Behavior
Q: The Indifference Curve represents:
A) Different combinations of two goods providing the same level of satisfaction
B) Relationship between income and expenditure
C) Relationship between price and quantity demanded
D) Cost minimization in production
Answer: A) Different combinations of two goods providing the same level of satisfaction
### 4. Production and Costs
Q: The Law of Diminishing Returns states that:
A) Increasing all inputs leads to increasing output
B) Adding more of one input, while keeping others constant, will eventually result in decreasing additional output
C) The total production remains constant regardless of inputs
D) A firm can produce unlimited output with limited resources
Answer: B) Adding more of one input, while keeping others constant, will eventually result in decreasing additional output
### 5. Market Structures
Q: Price discrimination is possible in which market structure?
A) Perfect competition
B) Monopoly
C) Oligopoly
D) Monopolistic competition
Answer: B) Monopoly
### 6. National Income Accounting
Q: Net National Product (NNP) is calculated as:
A) GDP + Depreciation
B) GDP - Depreciation
C) GNP + Depreciation
D) GNP - Depreciation
Answer: D) GNP - Depreciation
### 7. Money and Banking
Q: The money multiplier is determined by:
A) The central bank’s interest rate
B) The reserve requirement ratio
C) The level of inflation
D) The fiscal deficit
Answer: B) The reserve requirement ratio
### 8. Inflation and Unemployment
Q: According to the Phillips Curve, there is a trade-off between:
A) Inflation and unemployment
B) Money supply and interest rates
C) GDP and fiscal deficit
D) Imports and exports
Answer: A) Inflation and unemployment
### 9. Fiscal Policy and Public Finance
Q: A budget deficit occurs when:
A) Government revenue exceeds government expenditure
B) Government expenditure exceeds government revenue
C) Tax revenue is equal to government spending
D) Exports exceed imports
Answer: B) Government expenditure exceeds government revenue
### 10. International Trade
Q: The Balance of Payments (BOP) consists of:
A) Current account, capital account, and financial account
B) Exports and imports only
C) Only foreign direct investment
D) Only remittances from abroad
Answer: A) Current account, capital account, and financial account
