1.

Father of political economy:

A. Adam Smith B. Malthus

C. Marshall D. Samuelson

Answer & Explanation

Answer: Option A

Explanation:

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2. He described economics as a science of material welfare:

A. Robbins B. Marshall

C. Ricardo D. Keynes

Answer & Explanation

Answer: Option B

Explanation:

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3. Economic laws are:

A. Exact B. Approximate

C. Brief D. Definite

Answer & Explanation

Answer: Option B

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4. Economic laws are:

A. Scientific B. Moral

C. Natural D. Unreal

Answer & Explanation

 Answer: Option A

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5. Economics is a science:

A. Spiritual B. Social

C. Dismal D. Moral

Answer & Explanation

Answer: Option B

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6. Economic problems arise because of:

A. Greed B. Scarcity

C. Dishonesty D. Laziness

Answer & Explanation

Answer: Option B

Explanation:

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7. Which statement relates to macroeconomics:

A. Oil prices are rising in Pakistan B. Profit rate is high in textile industry

C. The firms try to make huge profits D. The government has failed to control

Answer & Explanation

Answer: Option D

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8. Which statement is true?

A. Economics is a physical and normative science B. Economics is a social and natural scie

C. Economics is physical and positive science D. Economics is a social and normative s

Answer & Explanation

Answer: Option D

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9. Ceteris paribus means:

A. Other things equal B. All variables are independent

C. Enable economists to simplify reality D. That no other assumptions are made

Answer & Explanation

Answer: Option A

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10. In economics, assumptions:

A. Make economic theory useless B. Mean other things equal

C. Enable economists to simplify reality D. Used in micro and not in macroecon

Answer & Explanation

Answer: Option C

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11. A positive statement:

A. Concerns 'what is' B. Is always accurate

C. Deals with values and opinions D. Cannot be tested in the real world

Answer & Explanation

 Answer: Option A

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12. Normative economics:

A. Deals solely with the facts B. Is never studied in colleges

Involves opinions and Is clearly preferable to positive

C. D.
interpretations economics

Answer & Explanation

Answer: Option C

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13. Basic economic problem is:

A. Inflation B. Unemployment

C. Poverty D. Scarcity

E. Lack of money

Answer & Explanation

Answer: Option D

Explanation:

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14. Microeconomics concentrates:

In a country that uses resources

A. In only poor countries B.
inefficiently

When society produces

C. In all countries of the world D.
unimportant or silly goods

Answer & Explanation

Answer: Option C
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15. Microeconomics concentrates:

A. On inflation B. International economic relations

C. Individual economic units D. Economic development of Pakistan

Answer & Explanation

Answer: Option C

Explanation:

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16. Macroeconomic deals with:

A. How to buy groceries B. Aggregate economic activity

C. Establishment of a new firm D. Industrial activity

Answer & Explanation

Answer: Option B

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17. Three basic economic problems:

A. What, how and for whom B. Why, where, and when

C. What, which and how much D. What, which, why

Answer & Explanation

Answer: Option A

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18. Economics:

Is more important than

A. B. Is a social science
mathematics
 Should be made compulsory for
C. D. None of these
every student

Answer & Explanation

Answer: Option B

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19. Economic law:

A. Must be followed B. Are hated by people

Show economic behaviour of

C. D. Are unscientific
people

Answer & Explanation

Answer: Option C

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20. Adam Smith was a:

A. Was a Saint B. A modern economist

C. Good sports man D. Classical economist

Answer & Explanation

Answer: Option D

Explanation:

21. Marshall in his definition of economics:

A. Uses the concept of material welfare B. Dislikes wealth

 C. Accuses Adam Smith D. Praises Robbins

Answer & Explanation

Answer: Option A

Explanation:

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22. "Wealth of Nations":

A. Is another name for United Nations B. Is a book

C. Indicates total wealth of rich countries D. Contains formulas to earn wealth

Answer & Explanation

Answer: Option B

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23. Marshall wrote the book:

A. Introduction to economics B. Principles of economics

C. Classical economics D. Microeconomic theory

Answer & Explanation

Answer: Option B

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24. Economic theory means:

A. Economic policy B. Principles of economics

C. Descriptive economics D. Economic facts

Answer & Explanation

Answer: Option B

Explanation:
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25. Robbins in his definition:

A. Talks of scarcity of resources B. Preaches moral values

C. Advises neutrality in economics D. None of the above

Answer & Explanation

Answer: Option A

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26. Market system means:

A. Socialism B. Capitalism

C. A place where goods are traded D. All of the above

Answer & Explanation

Answer: Option B

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27. One or more persons living together and having a common budget is called:

A. A family B. Organisation

C. Household D. All commodities in a house

Answer & Explanation

Answer: Option C

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28. "Wealth of Nations" was written in:

A. 1976 B. 1876

C. 1776 D. 1676
 Answer & Explanation

Answer: Option C

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29. Economic principles are also called:

A. Economic law B. Economic theory

C. Economic model D. All of the above

Answer & Explanation

Answer: Option D

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30. "Wealth of nations" was written by:

A. Adam Smith B. Malthus

C. Marshall D. Newton

Answer & Explanation

Answer: Option A

Explanation:

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31. Select the correct statement:

A. Economics affects politics B. Economics affects history

C. Geography affects economics D. All of the above are true

Answer & Explanation

Answer: Option D

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32. Professor Marshall thinks:

 A. Economics studies national welfare B. Economics studies personal welfare

C. Economics studies total welfare D. Economics studies material welfare

Answer & Explanation

Answer: Option D

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33. "Everyone should study economics":

A. Is a positive statement B. Is a narmative statement

C. Is a true statement D. Is nonsense

Answer & Explanation

Answer: Option B

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34. Utility and usefulness are:

A. Equal B. Different

C. Similar D. Unrelated

Answer & Explanation

Answer: Option B

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35. Rotten eggs are:

A. Free good B. Economic good

C. Service D. Wealth

Answer & Explanation

 Answer: Option A

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36. Scarcity means that:

A. Non-availability of goods B. High price of goods

C. Nobody wants to consume it D. The good is available but it is not free

Answer & Explanation

Answer: Option D

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37. The basic economic problem common to all societies is:

A. Scarcity cannot be totally eliminated B. What, how and for whom to produce

C. Equal distribution of wealth D. The achievement of full employment

Answer & Explanation

Answer: Option A

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38. Human wants are:

A. One thousand B. Few

C. Innumerable D. Countable

Answer & Explanation

Answer: Option C

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39. Scarcity means:

 A. Non-availability of goods B. High price of goods

C. Less supply than demand D. High profit of the firms

Answer & Explanation

Answer: Option C

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40. Validity of economic theories can never be proved with 100 percent certainty, because:

A. Ceteris paribus clause B. Limited number of observation is pos

Some observation will be made in furture which refute the

C. D. (b) and (c)
theory

Answer & Explanation

Answer: Option A

Explanation:

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