Principles of Economics Guess Papers 2017 11th Class

Principles of Economics Guess Papers 2017 11th Class

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Principles of Economics MCQs Guess Papers 2017

Frequently Asked Questions (2012 to 2016)


Most Important MCQs Questions Variations 2017

The founder of classical school of thought was
(A) Marshall
(B) Adam Smith
(C) Keynes
(D) Robbins

The goods on which the law of demand does not apply are called
(A) Services
(B) Goods and services
(C) Giffin goods
(D) Capital goods

Elasticity of demand of luxurious goods is
(A) Zero
(B) Infinite
(C) Less
(D) More

If supply curve is vertical then elasticity of supply is
(A) Zero
(B) Infinite
(C) Equal to unit
(D) More than unity

According to which Economist utility is measurable
(A) Marshall
(B) Adam Smith
(C) Robbins
(D) Keynes

Which one is not called land.
(A) Rain
(B) Mountain
(C) Forests
(D) Mangla Dam

When total product is maximum margnal product will be
(A) Positive
(B) Negative
(C) Zero
(D) Decreasing

The costs will change with the change in output is called
(A) Total costs
(B) Fixed Costs
(C) Variable Costs
(D) Marginal Costs

A monopolist firm usually earn
(A) Normal profit
(B) Abnormal profit
(C) Minimum profit
(D) Abnormal Loss

Who did present marginal productivity theory.
(A) Ricardo
(B) Marshall and J.B Clark
(C) Keynes
(D) Malthus

The income which a person can use according to his will is called
(A) Personal income
(C) Net income
(B) Disposable personal income
(D) Per capita income

The money whose face value is equal to its intrinsic value is called
(A) Token money
(B) Standard money
(C) Paper money
(D) Credit money

Economy gets prosperity during
(A) Recession
(B) Depression
(C) Boom
(D) Recovery

In balance of payment comprises
(A) Visible items
(B) Invisible items
(C) Visible and invisible items
(D) Capital goods

Which one of the following stated the canons of taxation first
(A) Adam Smith
(B) Robbins
(C) Pigou
(D) Keynes

Who said that Economics is science of wealth
(A) Robbins
(B) Marshall
(C) Adam Smith
(D) Keynes

When marginal utility is zero then total utility is
(A) Minimum
(B) Positive
(C) Maximum
(D) Zero

If demand curve is parallel to X-axis then elasticity of demand is
(A) Infinite
(B) Zero
(C) Equal to unity
(D) More than unity

Supply curve moves from left to right upward this tendency called
(A) Negative
(B) Positive.
(C) Horizontal
(D) Vertical

Which factor of production is result of human struggle
(A) Land
(B) Labbur
(C) Capital
(D) Organization

In law of constant return marginal product
(A) Inereases
(B) Decreases
(C) Remains constant
(D) Remains changing

The other name of law of constant return is
(A) Increasing cost
(B) Decreasing cost
(C) Constant cost
(D) Variable cost

When total product is increasing marginal product
(A) Positive
(B) Negatiye
(C) Decreases
(D) Zero

In short run fixed cost curve has the tendency
(A) Parallel to ox-axis
(B) Parallel to oy-axis
(C) Positive
(D) Negative

Shut down point appears when
(A) AR = AVC
(B) AR > AC
(C) AR < AVC (D) AC = MC Cheque and bill of exchange etc are (A) Metallic money (B) Paper money (C) Credit money (D) Near money Which Economist has stated the definition of balance of payments (A) Robbins (B) Kindle Berger (C) Marshall (D) Keynes Number of beneficiaries of zakat is stated in the Holy Quran (A) Five (B) Seven (C) Eight (D) Nine If income of the Government is more than its expenditures such budget is called (A) Surplus budget (B) Deficit budget (C) Balahced budget (D) Private budget AccOrding to Adam Smith economics is the study of (A) Time (B) Action (C) Wealth (C) Value The utility derived from the consumption of extra unit of a commodity is called (A) Total utility (B) Negative utility (C) Marginal utility (D) Positive utility The relationship between price and demand is (A) Direct (B) Inverse (C) Balanced (D) Compound The relationship betWeen price and supply is (A) Direct (B) Inverse (C) Balanced (D) CompOund The price at which demand and supply are equal is called (A) Equilibrium quantity (B) Equilibrium price (C) Reverse price (D) Balance of payment Marginal prodtiction is denoted by (A) AC (B) AP (C) MP (D) MC Law of decreasing return is immediately applied on (A) Industry (B) Agriculture (C) Trade (D) Construetion Under perfect competition a firm is in equilibrium when (A) TI1 =MR (B) MR = P (C) P = MC (D) MR = MC Under monopoly the elasticity of demand is (A) Less than unity (B) More than.unity (C) Equal to unity (D) Equal to zero Due to increase in wage rate the supply of labour (A) Decrease (B) Be limited (C) Increase (D) Be unlimited The methods to measure national income are (A) 2 (B) 4 (C) 5 (D) 3 The cheque is a kind of money (A) Legal tender money (B) Credit money (C) Paper money (D) Near money The sun spots theory was presented by (A) Adam Smith (B) Ricardo (C) W.S. Jevons (D) Robbins The policy to protect home industrieS front foreign competition is (A) Trade policy (B) Liscitl policy (C) Protection policy (D) Monetary policy The canons of taxation laid down by Adam Smith are (A) 1 (B) 2 (C) 3 (D) 4 The number of laws of costs is (A) One (B) Two (C) Three (D) Four The difference between total revenues (TR) and total costs (TC) is called (A) Loss (B) Profit (C) Profit or loss (D) Utility When national product is divided by population it is called (A) Total income (B) Per capita income (C) Personal income (D) Real income A tax in which rate of taxation increases with the increase in income is called (A) Proportional tax (B) Progressive tax (C) Regressive tax (D) Direct tax The exchange of goods is called (A) Barter system (B) Monetary system (C) Fiscal system (D) Domestic system Macro-economics was introduced by (A) Marshall (B) J.M. Keynes (C) Clark (D) Adam Smith The price at which quantity demanded and supplied are equal is called (A) Equilibrium price (B) Reserve price (C) Fixed price (D) Variable price In short run a monopolist firm usually gains (A) Normal profit (B) Abnormal profit (C) Normal loss (D) Abnormal loss The phases of trade cycle are (A) One (B) Two (C) Three (D) Four Marginal revenue product curve is called (A) Demand curve of firm (B) Supply curve of firm (C) Demand curve of industry (D) Supply curve of industry 12. When marginal utility is zero the total utility is (A) Negative (B) Positive (C) Maximum (D) Zero The record of visible and invisible on international account is called (A) Balance of payment (B) Balance of trade (C) Balance of budget (D) Capital account The increase in supply due to increase in price is called (A) Rise in supply (B) Fall in supply (C) Extension in supply (D) Contraction of supply The formula of calculating total revenue is (A) P x Q (B) P x AC (C) AC x Q (D) TC / Q Price is equal to (A) Average cost (B) Average revenue (C) Marginal cost (D) Marginal revenue Factors of production are also called (A) Productive services providers (B) Producers (C) Bankers (D) Inputs Air and rain are included in factors of production (A) Land (B) Labour (C) Capital (D) Organization Supply of perishable goods is (A) More elastic (B) Less elastic (C) Perfectly inelastic (D) Infinite elasticity of supply The elasticity of supply of perishable goods is (A) Zero (B) More than unity (C) Infinite (D) Less than unity Comparative cost theory of International Trade was presented by (A) Robbins (B) Ricardo (C) Keynes (D) Marshall Absolute advantage theory of International trade was presented by (A) Adam Smith (B) Ricardo (C) Marshall (D) Ohlin Which one is not studied in micro economic? (A) National income (B) Consumer behaviour (C) Market equilibrium (D) Firm's equilibrium A firm is in equilibrium when its (A) Marginal revenue is more than its marginal cost (B) Marginal revenue is equal to its marginal cost (C) Marginal revenue is less than its marginal cost (D) Marginal revenue is zero Firm's equilibrium is at that point where (A) MC = AR (B) MC = MR (C) MC = AC (D) MC = AVC Net National Product is found by (A) Gross NatiOnal Product less Taxes (B) Gross National Product less Subsidies (C) Gross National Product less depreciation allowance (D) All of these The cost of collecting taxes should be kept as low as possible it is according to (A) Canon of equality (B) Canon of economy (C) Canon of elasticity (D) Canon of productivity If supply of a commodity is fixed then due to fall of demand of that commodity (A) Its quantity sold will decrease (B) Its quantity sold will increase (C) Its price will decrease (D) Its price will increase The reason of extension of demand is (A) Change in income (B) Change in fashion (C) Change in price (D) Change in weather In 1776 who wrote the book named Wealth of Nations? (A) Marshall (B) Adam Smith (C) Pegue (D) Keynes Demand for the commodities whose use can be postponed is (A) Less elastic (B) More elastic (C) Inelastic (D) Perfect elastic The cause of extension and contraction of supply is (A) Population (B) Technology (C) Income (D) Price When demand does not change but supply increases then price (A) Decreases (B) Increases (C) Becomes zero (D) Remains constant Under perfect competition demand of commodity is (A) Less elastic (B) More elastic (C) Perfect elastic (D) Inelastic The entry of firms in monopoly is (A) Free (B) Prohibited (C) Conditional (D) With the permission of Govt. The basic factor of production is (A) Land (B) Labour (C) Capital (D) Entrepreneur If face value of currency is equal to its real value it is called (A) Token money (B) Standard money (C) Paper money (D) money Who first of all presented the concept of national income? (A) Marshall (B) Keynes (C) Pegue (D) Adam Smith The change in total cost is called (A) Average fixed cost (B) Average variable cost (C) Marginal cost (D) Average total cost What is the base of international trade theory of David Ricardo? (A) Absolute advantages (B) Comparative cost (C) Cheaper cost (D) Low cost Which tax is indirect tax? (A) Income tax (B) Sales tax (C) Property tax (D) Wealth tax Price is determined under perfect competition (A) By sellers (B) By buyers (C) By Government (D) By forces of demand and supply The second name of law of decreasing return is (A) Law of increasing cost (B) Law of constant cost (C) Law of decreasing cost (D) Law of cost Under monopoly average revenue curve remains the marginal revenue curve (A) Below (B) Above (C) parallel (D) None of these When supply decreases due to other factors besides price it is called (A) Extension of supply (B) Rise of supply (C) Contraction of supply (D) Fall of supply Which of the following stated that Utility is measurable (A) Marshall (B) Adam Smith (C) Robbins (D) Keynes Demand for necessities of life is (A) Less elastic (B) More elastic (C) Perfectly elastic (D) Inelastic Equilibrium level of national income means that point where (A) Consumption = saving (B) Consumption = Investment (C) Income = saving + investment (D) Saving = investment Absolute advantage theory was presented by (A) Adam Smith (B) Prof. Walker (C) Ricardo (D) Marshall Quantity theory of money was criticized by (A) Prof. Keynes (B) Prof. Marshall (C) Prof. Pigou (D) Both A and B To increase profit a firm minimizes (A) Revenues (B) Costs (C) Demand (D) Supply Government estimates its income and expenditures (A) Monthly (B) Three monthly (C) Six monthly (D) Annually Quantity of a commodity offered for sale in a market at a certain price during a given period of time is called (A) Stock (B) Demand (C) Supply (D) Quantity demanded Wealth of Nations was written in (A) 1756 A.D (B) 1776 A.D (C) 1876 A.D (D) 1698 A.D The specific quantity of a good which a consumer wishes to purchase at a given price is called (A) Supply (B) Demand (C) Both A and B (D) None of these If demand of a good decrease due to other factors is called (A) Fall of demand (B) Rise in demand (C) Expansion of demand (D) Contraction of demand If same amount of good is supplied at higher price it is called (A) Expansion of supply (B) Contraction of supply (C) Fall in supply (D) Rise in supply If there is equal increase in demand and supply the equilibrium price will (A) Rise (B) Fall (C) Unchange (D) None of these After achieving point of Satiation the total utility starts (A) Rising (B) Declining (C) Remains constant (D) None of these The Law of Diminishing Returns is also called (A) Law of diminishing costs (B) Law of increasing costs (C) Law of equi marginal utility (D) Law of diminishing utility Fixed costs are those costs of production which (A) Rise with quantity of output (B) Do not change with any amount of production (C) Decline with rising production (D) None of these In perfect competition the average revenue curve is (A) Vertical (B) Horizontal (C) Rising (D) Declining A monopolstie firm has control of (A) Whole market supply by one firm (B) Whole market supply by two firms (C) Whole market supply by a few firms (D) None of these All the factors of production can be hired except (A) Land (B) Labour (C) Capital (D) Organization National income is the value of all production in a year (A) Agricultural output (B) Industrial output (C) Fisheries and mining (D) All goods and services produced Barter means (A) Exchange of goods with money (B) Exchange of goods with services (C) Exchange of goods and services with goods and services (D) None of these The modern theory of trade cycle was given by (A) Prof. Schumpeter (B) Keynes (C) Hatray (D) Hicks and Samuelson The exchange of goods and services from country to country is called (A) Foreign trade (B) National trade (C) Corporate trade (D) Domestic trade The goods which are achieved without paying price are called (A) Economic goods (B) Uneconomic goods (C) Inferior goods (D) Superior goods Elasticity of the demand of luxurious goods is (A) Zero (B) Infinite (C) Iess (D) More Change in total product is called (A) Average product (B) Variable product (C) Marginal product (D) Constant product When price MR and AR are equal market is called (A) Monopoly (B) Perfect competition (C) Monopolistic competition (D) Oligopoly When AFC are partially and AVC are fully covered firm earns (A) Abnormal profit (B) Normal profit (C) Major loss (D) Minor loss Marginal productivity theory was presented by (A) Adam Smith (B) Malthus (C) Keynes (D) Marshall When national income is divided by population we get (A) disposable personal income (B) per capita income (C) personal income (D) real income The relationship between money supply and the value of money is (A) Unequal (B) Direct (C) Inverse (D) Positive During inflation the value of money becomes (A) Less (B) More (C) Zero (D) Infinite Which phase of trade cycle is better for the economy? (A) Boom (B) Depression (C) Recession (D) Recovery Sales tax is a (A) Direct tax (B) Indirect tax (C) Regressive tax (D) Fixed tax When marginal product is zero total product is (A) Maximum (B) Minimum (C) Negative (D) Zero Average revenue curve under perfect competition is (A) Positively sloped (B) Negatively sloped (C) Horizontal (D) Vertical The equilibrium level of national income is where (A) Qd = Qs (B) MR = MC (C) S = I (D) TR = TC Prices during deflation (A) Increases (B) Decreases (C) Does not change (D) None of three Which school of thought states that economics is a science of material wealth (A) Classical (B) Neo classical (C) Modern (D) Keynesian Slope of demand curve of giffen goods is (A) Negative (B) Positive (C) Horizontal (D) Zero If supply does not change then due to rise in demand equilibrium price (A) Increases (B) Decreases (C) Does not change (D) Becomes zero When average cost falls marginal cost is average cost (A) More than (B) Less than (C) Equal to (D) A and C During depression increases (A) Unemployment (B) Employment (C) Profit (D) Production Marginal revenue product is the amount of money attained by selling (A) Average product (B) Marginal product (C) Total product (D) None of three When marginal utility is positive total utility (A) Goes on increasing (B) Goes on decreasing (C) Is zero (D) Remains same If change in quantity supplied is 10% and change in price is 20% then elasticity of supply is (A) 20% (B) 10% (C) 0.5% (D) Zero Wages of temporary labourers are (A) Fixed cost (B) Marginal cost (C) Total cost (D) Variable cost In law of decreasing return marginal product (A) Increases (B) Decreases (C) Remains constant (D) Does not change Supply of durable goods is (A) Elastic (B) Perfectly elastic (C) Perfectly inelastic (D) Less elastic Relationship of value of money with quantity of money is (A) Direct (B) Indirect (C) Inverse (D) Positive In which year International Monetary Fund was established (A) 1941 (B) 1944 (C) 1945 (D) 1947 How many kinds of costs are in the short period (A) Two (B) Three (C) Four (D) Five In which phase of trade cycle level of employment and income becomes very low (A) Depression (B) Recovery (C) Boom (D) Recession One of the following is not included in the public expenditures (A) Courts (B) Fee (C) Public administration (D) Defence In the market period supply is (A) Variable (B) Fixed (C) Zero (D) Positive Increase in demand for commodity due to decrease in its price is called (A) Extension of demind (B) Contraction of demand (C) Rise of demand (D) Fall of demand Who wrote the book named "Principles of Economics"? (A) Adam Smith (B) Marshall (C) Robbins (D) Connon Marginal utility at the point a satiety is (A) Zero (B) Positive (C) Negative (D) Initial If demand for x commodity changes due to the change in price of commodity y it is called (A) Cross elasticity (B) Price elasticity (C) Income elasticity (D) Are elasticity Kinds of supply according to period of time are (A) 2 (B) 3 (C) 4 (D) 5 In economies every mental or physical struggle undertaken for reward is called (A) Land (B) Labour (C) Capital (D) Organization The slope of MR curve in monopoly is (A) Vertical (B) Increasing (C) Horizontal (D) Negative When total revenue and total cost of a firm are equal the firm earns (A) Abnormal profit (B) Normal profit (C) Normal loss (D) Abnormal loss According to which economist some factors are indivisible? (A) Adam smith (B) Marshall (C) Davenport (D) Hobson Period of national income counting is (A) Six months (B) Three years (C) Four years (D) One year World aconomic depression occurred in (A) 1927 (B) 1928 (C) 1929 (D) 1931 According to Prof. Jugglar a trade cycle completes in (A) Five to six years (B) Nine to ten years (C) Ten to eleven years (D) Eleven to twelve years Zakat means (A) Growth (B) Purification (C) Tax (D) Both A & B Monopoly can also be called (A) Perfect competition (B) Imperfect competition (C) Competition (D) None of these Presented the quantity theory of money (A) Marshall (B) Robbins (C) Fisher (D) Ricardo Zakat on Govt. level in Pakistan was implemented in (A) 1980 (B) 1978 (C) 1998 (D) 1988 Paper money is issued by (A) Habib Bank Limited (B) Muslim Commercial Bank (C) Allied Bank Limited (D) State Bank of Pakistan Wrote the book named "Wealth of Nations". (A) Keynes (B) Pigue (C) Adam Smith (D) Marshall The cost of production directly related to output are called (A) Fixed cost (B) Variable cost (C) Total cost (D) Marginal cost National income is divided by population We get (A) Disposable personal income (B) Real income (C) Per capita income (D) Personal income Quantity theory of money was presented by (A) Irving Fisher (B) Keynes (C) Malthus (D) Pigou The slope of supply curve is (A) Negative (B) Positive (C) Maximum (D) Zero The record of visible items is called (A) Internal trade (B) Balance of trade (C) Balance of payment (D) All of these It is not studied in macro-economics (A) National income (B) Employment (C) Trade cycle (D) Price theory When total utility is maximum the marginal utility is (A) Zero (B) Negative (C) Positive (D) Minimum The formula of elasticity of demand was presented by (A) Adam Smith (B) Marshall (C) Robbins (D) Pigou The equilibrium of market is (A) Qd — Qs = 0 (B) Qd = 0 (C) Qs > Qd
(D) Os < Qd The number of laws of returns are (A) (B) (A) (B) At minimum average cost marginal cost is (A) Zero (B) Minimum (C) Maximum (D) Equal to it The opposite market of perfect competition is (A) Monopoly (B) Monopolistic competition (C) Doupoly (D) Oligopoly Per capita income means (A) average income (B) total income (C) personal income (D) domestic income The value of money decreases in (A) inflation (B) deflation (C) monopoly (D) perfect competition The purchasing power increases in (A) recession (B) boom (C) depression (D) revival The deservers of Zakat are (A) 2 (B) 5 (C) 8 (D) 10 In law of decreasing return marginal product (A) Increases (B) Decreases (C) Remains constant (D) Does not change Marginal utility at the point of satiety is (A) Zero (B) Positive (C) Negative (D) Initial When marginal utility is positive total utility (A) Goes on increasing (B) Goes on decreasing (C) Is zero (D) Remains same When maiginal utility is zero then total utility is (A) Negative (B) Positive (C) Maximum (D) Zero According to which Economist utility is measureable (A) Marshall (B) Adam Smith (C) Robbins (D) Keynes When AFC are partially and AVG are fully covered firm earns (A) Abnormal profit (B) Normal profit (C) Major loss (D) Minor loss When total revenue and total cost of a firm are equal the firm earns (A) Abnormal profit (B) Normal profit (C) Normal loss (D) Abnormal loss If demand for x commodity changes due to the change in price of commodity y it is called (A) Cross elasticity (B) Price elasticity (C) Income elasticity (D) Arc elasticity A monopolistic firm has control of (A) Whole market supply by one firm (B) Whole market supply by two firms (C) Whole market supply by a few firms (D) None of these According to Prof. Jugglar a trade cycle completes in (A) Five to six years (B) Nine to ten years (C) Ten to eleven years (D) Eleven to twelve years The goods which are achieved without paying price are called (A) Economic goods (B) Un-economic goods (C) Inferior goods (D) Superior goods When marginal product is zero total product is (A) Maximum (B) Minimum (C) Negative (D) Zero In which year International Monetary Fund was established (A) 1941 (B) 1944 (C) 1945 (D) 1947 In economics every mental or physical struggle undertaken for reward is called (A) Land (B) Labour (C) Capital (D) Organization According to which economist some factors are initivisible? (A) Adam smith (B) Marshall (C) Davenport (D) Hobson

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