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Economics Mcqs 4423 MCQs [All-Courses]

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.

A progressive tax system is one where ?

A marginal tax rates are high.

B higher income taxpayers pay more taxes than do lower income taxpayers.

C marginal tax rates are low.

D higher income taxpayers pay a greater percentage of their income in taxes than do lower income taxpayers.

Review Detailed Answer

Correct Answer: higher income taxpayers pay a greater percentage of their income in taxes than do lower income taxpayers.

The appropriate tax rate to consider judging the vertical equity of a tax system is the ?

A marginal tax rate

B average tax rate

C horizontal tax rate

D proportional tax rate

Review Detailed Answer

Correct Answer: average tax rate

An efficient tax ?

A minimizes the administrative burden form the tax

B does all the things describe in these answers

C raises revenue at the smallest possible cost to taxpayers.

D minimize the deadweight loss from the tax.

Review Detailed Answer

Correct Answer: does all the things describe in these answers

Sana values a pair of blue jeans at Rs400. If the price is Rs350 Sana buys the jeans and generates consumer surplus of Rs50 Suppose a tax is placed on blue jeans that causes the price of blue jeans to rise to Rs450 Now sana chooses not to buy a pair of?

A the deadweight has demonstrated

B the ability-to-pay principle

C the benefits principle

D horizontal equity

Review Detailed Answer

Correct Answer: the deadweight has demonstrated

When a tax distorts incentives to buyers and sellers so that fewer goods are produced and sold than otherwise the tax has ?

A caused a deadweight loss

B decreased equity

C generated no tax revenue

D increased efficiency

Review Detailed Answer

Correct Answer: caused a deadweight loss

If a tax on a good is doubled the deadweight loss from the tax ?

A doubles

B stays the same

C increase by a factor of four.

D could rise or fall

Review Detailed Answer

Correct Answer: increase by a factor of four.

When a tax on a good start small and is gradually increased tax revenue ?

A will fall

B will rise

C will first rise and then fall

D will first fall and then rise

Review Detailed Answer

Correct Answer: will first rise and then fall

Since the supply of undeveloped land is relatively inelastic a tax on undeveloped land would generate ?

A a small deadweight loss and the burden of the tax would fall on the renter

B a large deadweight loss and the burden of the tax would fall on the landlora

C a large deadweight loss and the burden of the tax would fall on the renter.

D a small deadweight loss and the burden of the tax would fall on the landlord

Review Detailed Answer

Correct Answer: a small deadweight loss and the burden of the tax would fall on the landlord

A tax on petrol is likely to ?

A generate a deadweight loss that is unaffected by the time period over which it is measured

B cause a greater deadweight loss in the long run when compared to the short run

C None of these answers

D cause a greater deadweight loss in the short run when compared to the long run.

Review Detailed Answer

Correct Answer: cause a greater deadweight loss in the long run when compared to the short run

Refer to Exhibit 4. Which of the following is true with regard to the burden of the tax in Exhibit 4 ?

A The buyers pay a larger portion of the tax because demand is more inelastic than supply

B The sellers pay a larger portion of the tax because supply is more elastic than demand

C The buyers pay a larger portion of the tax because demand is more elastic then supply

D The sellers pay a larger portion of the tax because supply is more inelastic than demand

Review Detailed Answer

Correct Answer: The sellers pay a larger portion of the tax because supply is more inelastic than demand

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Economics Mcqs 4423 MCQs [All-Courses]

All Topics 4423

All Topics 4423

A progressive tax system is one where ?

The appropriate tax rate to consider judging the vertical equity of a tax system is the ?

An efficient tax ?

Sana values a pair of blue jeans at Rs400. If the price is Rs350 Sana buys the jeans and generates consumer surplus of Rs50 Suppose a tax is placed on blue jeans that causes the price of blue jeans to rise to Rs450 Now sana chooses not to buy a pair of?

When a tax distorts incentives to buyers and sellers so that fewer goods are produced and sold than otherwise the tax has ?

If a tax on a good is doubled the deadweight loss from the tax ?

When a tax on a good start small and is gradually increased tax revenue ?

Since the supply of undeveloped land is relatively inelastic a tax on undeveloped land would generate ?

A tax on petrol is likely to ?

Refer to Exhibit 4. Which of the following is true with regard to the burden of the tax in Exhibit 4 ?