Basics of Economics MCQs and Notes

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Q 41. Which of the following is true?

(A) gnp + depreciation = nnp

(B) gnp = gdp + net factor income from abroad

(C) ndp = gnp minus net indirect taxes

(D) nnp = dgp minus depreciation

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Q 42. The difference between GDP and NDP equals:

(A) transfer payments

(B) net indirect taxes

(C) net factor income from abroad

(D) depreciation

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Q 43. National Income means:

(A) gnp at factor cost

(B) gnp at market price

(C) nnp at factor cost

(D) nnp at market price

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Q 44. Supply curve represents -------- relationship between quantity and price

(A) direct

(B) inverse

(C) either direct or inverse

(D) none of the above

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Q 45. There is ------- relationship between price and quantity supplied

(A) positive

(B) negative

(C) constant

(D) inverse

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Q 46. When MC is greater than AC, AC

(A) rises

(B) falls

(C) maximum

(D) minimum

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Q 47. The cost of next best alternative is called

(A) marginal cost

(B) average cost

(C) opportunity cost

(D) direct cost

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Q 48. A fall in the market demand, supply remaining the same results in

(A) increase in equilibrium price

(B) increase in equilibrium quantity

(C) increase in equilibrium price and decrease in equilibrium quantity

(D) both equilibrium price and quantity falls

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Q 49. There is no distinction between firm and industry in

(A) perfect competition

(B) monopoly

(C) monopolistic competition

(D) oligopoly

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Q 50. An increase in market demand, supply remaining the same results in

(A) decrease in equilibrium price

(B) decrease in equilibrium quantity

(C) decrease in equilibrium price and increase in equilibrium quantity

(D) both equilibrium price and quantity rises