Unit - I
Multiple Choice Questions (MCQs)
1. Microeconomics studies:
A. Whole economy
B. National income
C. Inflation
D. Individual units like households and firms
Answer: D
2. Macroeconomics focuses on:
A. Individual consumer behavior
B. Market structures
C. Aggregate economic variables
D. Price mechanism in a firm
Answer: C
3. The main objective of a Production Possibility Curve (PPC) is to show:
A. Market trends
B. Demand and supply
C. Opportunity cost
D. Consumer preference
Answer: C
4. The PPC is concave due to:
A. Increasing opportunity cost
B. Constant opportunity cost
C. Decreasing opportunity cost
D. Zero opportunity cost
Answer: A
5. A shift of the PPC to the right indicates:
A. Economic regression
B. Technological progress
C. Fewer resources
D. Lower productivity
Answer: B
6. Microeconomics deals with:
A. National budget
B. Government fiscal policies
C. Price and output decisions of firms
D. International trade
Answer: C
7. Which is not a central issue in economics?
A. What to produce
B. How to produce
C. Where to produce
D. For whom to produce
Answer: C
8. The relationship between science, engineering, and economics is important for:
A. Political stability
B. Social welfare only
C. Economic development
D. Environmental degradation
Answer: C
9. Macroeconomics includes the study of:
A. Price of one product
B. Demand for sugar
C. Aggregate employment
D. Utility of a product
Answer: C
10. Engineering contributes to economic development by:
A. Reducing investment
B. Increasing product innovation and productivity
C. Avoiding technology use
D. Limiting competition
Answer: B
11. Economic laws are considered:
A. Universal and absolute
B. Normative
C. Conditional and general
D. Fixed and unchangeable
Answer: C
12. Which curve explains scarcity and trade-offs?
A. Demand curve
B. Supply curve
C. PPC
D. IS curve
Answer: C
13. An economy operating inside the PPC is:
A. Efficient
B. Fully utilizing resources
C. Underutilizing resources
D. Overproducing
Answer: C
14. The term "opportunity cost" means:
A. Cost of missed opportunity
B. Cost of acquiring resources
C. Cost of training labor
D. Cost of technological development
Answer: A
15. Macroeconomic policy includes:
A. Pricing policy of a company
B. Resource allocation in a firm
C. Monetary and fiscal policy
D. Brand positioning
Answer: C
16. Engineering technology promotes:
A. Market competition
B. Trade restrictions
C. Industrial development
D. Monopoly
Answer: C
17. Scarcity leads to:
A. Unlimited production
B. Choice and prioritization
C. Equal distribution
D. No production
Answer: B
18. A normative economic statement is:
A. Based on facts
B. What ought to be
C. Scientifically tested
D. Always true
Answer: B
19. The slope of the PPC shows:
A. Efficiency
B. Price elasticity
C. Marginal cost
D. Opportunity cost
Answer: D
20. Which of the following is an example of microeconomic study?
A. Unemployment rate
B. Inflation rate
C. GDP growth
D. Price determination of mobile phones
Answer: D
Fill in the Blanks
-
Microeconomics is concerned with the behavior of __________ and firms.
Answer: individuals -
Macroeconomics deals with aggregates like __________ and employment.
Answer: national income -
The PPC illustrates the concept of __________ cost.
Answer: opportunity -
A rightward shift in PPC shows __________ in resources or technology.
Answer: improvement -
Economic laws are __________ in nature.
Answer: general -
Scarcity leads to the need for __________ in economics.
Answer: choice -
Engineering innovation boosts __________ productivity.
Answer: economic -
The relationship between science and economy fosters __________ development.
Answer: technological -
A point inside the PPC indicates __________ utilization of resources.
Answer: under -
Economics is the study of allocation of __________ resources.
Answer: scarce
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