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Economics Mcqs 4423 MCQs [All-Courses]

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Economics MCQs cover fundamental concepts of microeconomics and macroeconomics, including demand and supply, inflation, national income, and economic policies.
This section is designed to strengthen analytical skills and conceptual understanding for competitive examinations.
Highly useful for PPSC, FPSC, NTS, OTS, KPPSC, and other testing services preparation.

All Topics  4423

According to the Phillips curve unemployment will return to the natural rate when ?
A Nominal wages are equal to expected wages
B Real wages are back at equilibrium level
C Nominal wages are growing faster than inflation
D Inflation is higher than the growth of nominal wages
Correct Answer: Nominal wages are equal to expected wages
Menu costs in relation to inflation refers to ?
A Costs of finding better rates of return
B Costs of altering price lists
C Costs of money increasing its value
D Costs of revaluing the currency
Correct Answer: Costs of altering price lists
An increase in costs will ?
A Shift aggregate demand
B Shift aggregate supply
C Reduce the natural rate of unemployment
D Increase the productivity of employees
Correct Answer: Shift aggregate supply
An increase in injections into the economy may lead to ?
A An outward shift of aggregate demand- and demand-pull inflation
B An outward shift of aggregate demand and cost push inflation
C An outward shift of aggregate supply and demand-pull inflation
D An outward shift of aggregate supply and cost push inflation
Correct Answer: An outward shift of aggregate demand- and demand-pull inflation
Demand pull inflation may be caused by ?
A An increase in costs
B A reduction in interest rate
C A reduction in government spending
D An outward shift in aggregate supply
Correct Answer: A reduction in interest rate
If borrowers and lenders agree on a nominal interest rate and inflation turns out to be less than they had expected ?
A neither borrowers nor lenders will gain because the nominal interest rate has been fixed by contract
B None of these answers
C borrowers will gain at the expense of lenders
D lenders will gain at the expense of borrowers
Correct Answer: lenders will gain at the expense of borrowers
Under which of the following conditions would you prefer to be the lender ?
A The nominal rate of interest is 15 percent and the inflation rate is 14 percent
B The nominal rate of interest is 20 percent and the inflation rate is 25 percent
C The nominal rate of interest is 12 percent and the inflation rate is 9 percent
D The nominal rate of interest is 5 percent and the inflation rate are 1 percent
Correct Answer: The nominal rate of interest is 5 percent and the inflation rate are 1 percent
Which of the following statements is correct ?
A none of these answers
B The nominal interest rate is the inflation rate minus the real interest rate
C The real interest rate is the nominal interest rate minus the inflation rate
D The nominal interest rate is the real interest rate minus the inflation rate.
Correct Answer: The real interest rate is the nominal interest rate minus the inflation rate
If the nominal interest rate is 7 percent and the inflation rate is 3 percent, then the real interest rate is ?
A 4 percent
B 10 percent
C -4 percent
D 3 percent
Correct Answer: 4 percent
Refer to Figure 24-1 What is the value of the basket in the base year ?
A Rs459.25
B Rs418.75
C Rs300
D None of these
Correct Answer: Rs300
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