Business Economics MCQ Questions and Answers for Practice

1. With which of the following is the concept of marginal cost closely related?

1. Economic cost
2. Variable cost
3. Fixed cost
4. Opportunity cost

2. Which one of the following is also known as Long run average cost curve?

1. None of above
2. Basket Curve
3. Wallet Curve
4. Envelope curve

3. Which of the following statements is false?

1. none
2. Statistics is derived from the Latin word status
3. statistics is derived from Italian word statista
4. statistics is derived from in French word statistik

4. Which of the following is the method of measuring elasticity of demand when change in price of a commodity is substantial?

1. None of these
2. Arc method
3. Point method
4. Percentage method

5. Which of the following is the best formula of the production function?

1. None of above
2. Q = F (L,L,K,E)
3. Q = F (L,E)
4. Q = F (L,L,K,E) T

6. Which of the following is not considered production in Economics?

1. Painting a picture for sale
2. Tilling of soil by farmers
3. Singing a song before friends
4. Construction of Canal by laborers

7. Which of the following is not a characteristic of labour?

1. It is rewarded with wages
2. Its inseparable from laborer
3. It is immobile & passive
4. It is human efforts

8. Which of the following is an example of internal diseconomies?

1. Labour – management disputes in firm
2. High salary of firm
3. High tax for industry
4. Low tax for industry

9. Which of the following is an example of External economies?

1. Labour – management disputes of firm
2. Low salary of firm
3. tax exemption for industry
4. High tax for industry

10. Which of the following is an example of external diseconomies?

1. High Tax Govt. Policy
2. Lower salary of firm
3. Higher salary of firm
4. Tax exemption by Govt.

11. Which of the following does not have non linear shape?

1. None of above
2. Total cost curve
3. Total Variable cost curve
4. Total fixed cost curve

12. which method of data collection covers the widest area?

1. All of these
2. Telephone Interview
3. Mailed Questionnaire
4. Direct Interview

13. When the price of a complementary of commodity X falls, the demand for X

1. Any of the above
2. Falls
3. Rises
4. Remains unchanged

14. When marginal product (MP) & average product (AP) both falls

1. None of above
2. AP lies below MP
3. AP & MP intersect
4. MP Lies below AP

15. Under a Command economy

1. Neither a nor b
2. State plays a major role
3. Market plays major role
4. Both a & b