(A) foregone

Production Possibility c. Cost of next best alternative

(1)
Frontier
economic problems
are actually solved
(iv) How to Produce d. Deals with how the
3. V
Ans. (i) c; (i) d: (ii) b; (v) a.
correct options given under B.
Q.5. Match the statements given under A with the
(A)
(B)
) Normative Economics a. Transformation Curve 4.

i) Microeconomics b. Discovery of new natural resources

(i) Growth of Resources
(iv) What to Produce
(v) Production Possibility
Frontier
C. It is suggestive in nature
5.
d. Cotton Industry
e. Selection of goods and services to be produced
6.

Ans. (0 c:() d: (i) b; (iv) e: (v) a

Q.6. Match the statements given
under Awith the correct options given under B.
(A) (B)
) Concave PPF a. Constant MRT
i) Convex PPF b. Increasing MRT

c. Decreasing MRT
Ans. () b:(i)c.
Q.7. Match the statements
given under A with the correct options
(A) given under B.
Microeconomics (B)
a. Income and
() Macroeconomics Employment Theory
b. Positive Economics
c. Price Theory
Ans. (0 c:()a.

(MCOs) MULTIPLE CHOICE

(MROs) MULTIPLE QUESTIONS and
nthe following
Questions, there may be one or more RESPONSE QUESTIONS
than one correct
1. The law of scarcity answer. You have to
mark all the correct
(a) Does not apply to
rich, answets
(b) Applies only to the lessdeveloped countries.
(c) jmplies that consumers developed countries.
Implies that consumer's want will be satlisfied in a
wants will never socialistic system.
2. Assume that a PPF for be
(a) Less and less units
butter and
guns is drawn socompletely satisfied.
of butter are that it
sacrifliced to gain an is a straight line. It
sac
additional unit of gun. means:
 1.34
noToeconon
willead to shift
in PPF? of new oil reserves
(b) Exploration
ntroduction

15. Which ofthe following 1.35

Technology None of these Which of the following mustrates a decrease in the t unemployment using the PPC?
(a) Upgradation of (d) movement
down the PPC
along
(c) Massive unemployment (a) A shift of the PPC
rightward
being faced is (b) Limited wants and unlimited resou (b) A
fundamental economic problem
Ources (c) A movement irOm a point on the PPCto a point inside the PPC
16. The from inside the PPC
a point to a
limited resouree movement point towards the PPC
(a) Unlimited human wants
(d) Limited wants and
s (d) A
and scarcity of
resources What to produce covers the issue relating to:
()Unlimited wants problem of
level of the The
income and employment 25. to be produced
aims to determine (b) M a c r o e c o n o m i c s omy? What goods
are (b) What quantities of
17. Which part of economic theory (a) goods to be produced
Both
and
(a) (b) (d) Neither (a) nor (b)
(a) Microeconomics Both (a) and (b) (c)
d) table:
(c) Neither (a) nor (b) Consider the following
in case of both the goods? 26. Production Possibilities
if there is technological
upgradation C D
18. What will happen to PPF Leftward Shift in PPF
(b) Guns (Units) 3
(a) Rightward shift in PPF None of these 10
(d) Butter (Units) 9 7
(c) Rotation of PPF 0

19. Answer the following questions with the help of following diagram: (i)1
The opportunity cost of increasing guns production from 2 to 3 units isunits of butter

7 (b)2
(a) (d) 3
()4
G
to E deal with:
(ii) All possibilities A
Full use of available resources (b) Under-utilisation of available resources
(a)
No use of available resources (d) Demand for more resources
(c)
(i) If at some other point say G, the economy produces 2units of guns and 6 units of butter,then:
(6) Economy would operate at a point below PPF
of resources
(a) It represent under-utilization
F
(d) Neither (a) nor (b)
>x (c) Both (a) and (b)
Butter (in units) (iv) If the above points to
A E are depicted on a graph, then such PPF would be:
Convex to the origin (b) Concave to the origin
(a)
(i) Which of the following point represents underutilisation of resources? (c) Straight line (d) Rectangular hyperbola
(a) G (b) E
27. Economics is the study of:
(c) A ) F unlimited resources (b) How to reduce our wants until we are satistied
(a) How sOciety manages its
its (d) How to fully satisíy our limited wants
(ii) Which of the following point represents fuller and efficient utilisation of (c) How society manages scarce resources
resources? efficient' level of output?
(a) B 28. Which point on the following PPC shos a "productively
(b) G
) F
(d) None of these
(ii) Which of the following point shows unattainable G
(a) C combination?
(c) G (b) F
(d) A
20. Labour-intensive techniques are chosen in a:
(a) Labour-surplus economy D
(c) Developed economy (b) Capital-surplus economy
F
(d) Developing economy E >X
21. Which of the
following is related to Microeconomics? Butter (in units)
(a) Jute Industry
(c) National income (b) Unemployment Problem (b) B
(d) Income from Postal (a) A
22. Which of the (d) All of these
following
(a) Scarcity of Resources
is a cause of economic problem? department (c) E
3. In deciding "How to produce", the economy should consider:
(c) Alternative Uses Techniques
(b) Unlimited Wants (b) Capital
Intensive

(d) All of these (a) Labour Intensive Techniques nor (b)

23. Which of the following is a central problem of (c) Both (a) and (b) (d) Neither (a)
(a) How to Produce economy? 30.
(c) What to Produce (b) When to Opportunity Costs arise: When there are
two or more
alternative
courses

(b)
(d) For whomProduce
to
(a) When there is only course of action
Produce
 irodutOyy Icroe
Microeconon

1.36 Neither (a) nor (b)

d) Introduction
1.37
in PPC is due to:
(c) Both (a) and (b) possibility
Curve?
following
change

about production The

s t a t e m e n t is true
s a m e level of
satisfaction 36.
31. Which of these which yield
c o m b i n a t i o n s of
two goods
various can produce with i.
(a) It shows
combination of two goods
which an economy
a
given amoun
It shows various
(b)
resources and technology. can produce with a given
() It shows various
combination of two goods
which an economy

can produce with a qgiven ti

udget
which an economy
It shows various combination
of two goods Good X
>X
(d)
Frontier is generally: (b) Destruction of Resources
32. The Production Possibility (b) Concave Shaped Downward Sloping
(a) Massive Unemployment

(d) Fuller Utilisation of Resources

Shaped Downward Sloping
Resources
Convex in
(a) (d) Neither (a) nor (b) (c)
Increase
Of "Underutilisation' and 'Unattain:
(c) Either (a) or (b) of sequence, the pointS are:
27 In the order
it will lead to the following.oh
33. Due to Make in India', there has been large inflow of foreign capital. ange
in PPC:
Y C

D
--- E
-- >X
--- Good X
---
(b) Fand E
(a) A and F
(d) Eand F
X >X X (c) DandE
Good X Good X GoodX Good X Frontier?
is an assumption of Production Possibility
38. Which of the following
(a) (6) (C) (d) Resources are not fully employed.
(a)
34. The shift in PPC is caused due to: are not efficient for production of the two goods.
equally
(b) Resources

(c) Resources are not efficiently employed.

Resources available are not fixed.
(d)
- 39. Macroeconomics focuses on all of
the following except:
(6) Infilation in the Economy
(a) Allocation of Resources (d) Jute Industry
() Aggregate Demand

example of a Positive Economy:

40. Which of the following is an
income in our economy
(b) There are inequalities of
X (a) India is taking steps to control rising prices should be reduced
Butter (units) (d) Income inequalities
(a) Increase in resources for (C) India should not be an overpopulated country
(b) Increase
production of both the goods
pollution' or Unemploymentinthe economy ougnt
to De
in resources for
production of butter only h e statements like 'Economy should control
(c) Increase in resources for reduced' fall within the scope of:
production of guns only (b) Positive Statements
(d) None of these
(a) Normative Statements
None of these
35. In case of (d)
decreasing MRI, the shape of PPC will be (c) Both (a) and (b)
resources: (0 20X + 1Y, Or () toA T

depicted by the foliuwing has 2 alternatives of production from

the available
Y diagram: eConomy
then whatis the MOC of producing
chooses the second alternative,
n e economy (b) 2X
(a) 1X
(d) None of these
(c) 1Y
43. The alternatives

Opportunity Cost arises: (b) When there

are two or
more

(a) When there is just one alternative these

None of
X (d)
Good X
Good x (c)Either(a) or (b)
44. made by tWo people
(a) Good X n th statements are
b)
Good X x t of rising prices, following
C) Udit: Prices in the economy are continuously rising
(d)
 1.38 control rising prices.
steps to
Government should
take reasonable Introduction

The
Shivam:
Statement and
Normative
Statement. Good Y 1.39
statements as Positive
ldentify the Udit: Normative; Shivam: Positive
Normative
(b)
(a) Udit: Positive; Shivam: are Normative Statements
(d) Both
(c) Both are Positive Statements

45. Production Possibility Frontier is: (b) Concave Shaped

(a) Downward Sloping
(d) Either (a) or (b) O Good X
(c) Both (a) and (b)
the production possibly from point
Curve from
point A
A to
to
46. In the given figure, the movement on
point (a)
Decrease in r e s o u r c e s (b) Increase in resources
shows (Choose the correct alternative) (c) Full and
eficient utilisation of resources (d) Wastage of resources
Good Y qiven fiqure X,Y, and XY2 are Production Possibility Curves in two different time periods T,
Traspectively. A, and A represent actual outputs in T, and
T periods respectively. P, and P
are potential outputs in l, andl2 periods respectively.
Good Y

Y2
Good X
Y
(a) Growth of all the resources in the economy.
A
(b) Underutilisation of resources. A
(c) Production of more units of Good X and less units of Good Y. Good X
(d) Production of more units of Good Y and less units of
Good X The change in potential production over the two periods would be represented by a shift from
47. In the given figure X,Y, and (Choose the correct alternative)
X,Y2 are Production Possibility Curves in two different
respectively for Good X and Good Y. A, and A, period T, and T (a) P to Az (b) A, to A
represent actual outputs and P, and P2 (c) Ag to A (d) P, to P2
potential outputs respectively in the two time
periods.
represen
50. Positive Economic analysis is concerned with:
Good Y (a) Opinions (b) Value Judgements
(c) Facts and Figures (d) ldeals

51, Fit India Movement launched by the Indian Governmentwilleadto:

(a) Leftward Shift in PPC (b) Rightward Shift in PPC
(c) Forward Rotation on X-axis (d) No Change in PPC
Ap
52. Out of the following, which one is Macro variable?
Motors
A (a) Production of Food Grains in India (b) Pricing decision by Tata
in Petrol Prices
X, XGood X () Measurement of General Price Level (d) Fall
The change in actual output of Goods X 63. Which of the following is the salient feature of resources?
from
and Y over the alternative uses
(Fill up the blank) two periods (a) They are limited as compared to wants (b) They have
would be
(a) A, to Pa2 represented by movOvemen
(c) Both (a) and (b) (d) They are
unlimited
the PPC.
(o) P, to A (6) A, to P2 t n e r e in unemployment in the economy, then we would be producing
(a) Below (b) Above
48. Shift from Point on
A ProductionF (d) A, to
Ag None of the above.
(Choose the correct alternative) Possibilitly Curve X,Y, to Point B on
(c) On (d)
9. (a); 11. (D).
10. (c); 12. (C), 13. (C).
Ans 2. (c); 3. (a), (d); 4. (c); 5. (b); 6. (b); 7. (a); 8. (a). (d);
X,Y, in the given
give figure indicate 15. (a), (b); 16. (c); 17. (b); 18. (a);
19. (i d, ii -a,ii-c);20.
-
(a); 21. (a). (d); 22. (d);
28. (d); 29. (c); 30. (b)
4(D); 27. (c);
26. (i d, ii a, ii -C,iv-b);
-

(a), (C), (d); 24. (d); 25. (c);

-

E0.
 Introductory Microeconomics

O.(D) 32. (b); 33. (b);34. (a); 35. (d):36.(cl: 37 (d): 38, (b); 39. (a), (d);*
48. (D); 49. (d);
* . (a); 42.
(b); 43. (b); 44. (a): 45 (c): 46. (c); 47. (d); 53. (c); 54. (a).
50. (c); 51. (b); 52. (c);