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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

Which trade theory contends that a country that initially develops and exports a new product may eventually become an importer of it and may no longer manufacture the product ?
A Theory of factor endowments
B Theory of overlapping demands
C Economies of scale theory
D Product life cycle theory
Correct Answer: Product life cycle theory
The factor endowment model of international trade was developed by ?
A Adam Smith
B David Ricardo
C John Stuart Mill
D Eli Heckscher and Bertil Ohlin
Correct Answer: Eli Heckscher and Bertil Ohlin
Interindustry trade can be explained by all of the following except ?
A high transportation costs as a proportion of product value
B different growing seasons of the year for agricultural products
C product differentiation for good such as automobiles
D high per capita incomes in exporting countries
Correct Answer: high per capita incomes in exporting countries
A product will be traded only if the pre-trade price difference between the two countries ?
A is less than the cost of transporting it between them
B is greater than the cost of transporting it between them equals the cost of transporting it between them
C equals the cost of transporting it between them
D more information in needed to answer this
Correct Answer: is greater than the cost of transporting it between them equals the cost of transporting it between them
Assume that Country A is relatively abundant in labor and Country B is relatively abundant in land Note that wages are the returns to labor and rents are the returns to land According to the factor price equalization theorem, once Country A begins specializing according to comparative advantage and trading with Country B: A. wages and rents should fall in Country A B. wages and rents should rise in Country A C. wages should rise and rents should fall in Country A D. wages should fall and rents should raise in Country A ?
A
B wages and rents should rise in Country A
C wages should rise and rents should fall in Country A
D wages should fall and rents should raise in Country A
Correct Answer: wages should rise and rents should fall in Country A
The factor endowment theory was pioneered by ?
A Adam smith
B David Ricardo
C Wassily Leontief
D Eli Heckscher and Bertil Ohlin
Correct Answer: Eli Heckscher and Bertil Ohlin
Wassily Leontief’s results can be interpreted as ?
A evidence against the Ricardi an model
B evidence against the Heckscher-Ohl in model
C support for the Ricardian model
D support for the Heckcher Ohlin model
Correct Answer: evidence against the Heckscher-Ohl in model
Leontief’s result were considered paradoxical because the United Stated was believed to be ?
A technologically efficient relative to the rest of the world
B capital abundant relative to the rest of the world
C labor abundant relative to the rest of the world
D All of the above
Correct Answer: capital abundant relative to the rest of the world
In his empirical tests, Wassily Leontief used an input-output table to ?
A calculate the capital and labor required to produce $1 million of U.S exports and imports
B calculate the labor productivity of America workers relative to foreign workers
C calculate the capital productivity of American capital relative to foreign capital
D All of the above
Correct Answer: calculate the capital and labor required to produce $1 million of U.S exports and imports
Wassily Leontief used an input output table in order to test the ?
A Ricardian theory of comparative advantage
B Heckscher Ohl in theory of comparative advantage
C Linder theory of overlapping demand
D All of the above
Correct Answer: Heckscher Ohl in theory of comparative advantage
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