📊Economics MCQs
Economics MCQs
451 MCQs1
Which of the following is not true about how people make decisions ?
Apeople give too much weight to a small number of vivid observations
BPeople are sometimes too sure of their own abilities
CAll of these answers are actually true statements about how people make decisions.
DPeople are always rational maximizers E. People are reluctant to change their minds in the face of new information
2
Suppose that 40 percent of the voting population wish to spent Rs1,000 for artwork in City Hall, 25 percent wish to spent Rs20,000 and 35 percent wish to spend Rs 22,000 What is the median preferred outcome, the average preferred outcome and the modal preferred outcome ?
ARs20,000; Rs20,000; Rs22,000
BRs1,000; Rs14,333; Rs1,000
CRs20,000; Rs13,100; Rs1,000
DRs1,000; Rs20,000; Rs22,000
3
Which of the following best demonstrates the problem of moral hazard ?
AJosephine doesn’t buy health insurance because it is too expensive, and she is healthy
BA life insurance company forces Enzo to have a medical examination prior to selling him insurance
CEnzo drives more recklessly after he buys car insurance
DFatima chooses to attend a well-respected college
4
Which of the following must be true about a signal that is used to reveal private information in order for the signal to be effective ?
AIt must be “as seen on TV”
BIt must be free to the signaling party
CIt must be costly to the signaling party but less costly to the party with higher-quality product
DIt must be applied to an inexpensive product
5
Nicole wants to avoid buying a car that is a lemon. She takes a car she would like to buy to her mechanic before she purchases it. This is known as ?
Ascreening
Bsignaling
Cmoral hazard
Dadverse selection
6
Privatization is the transfer of ?
Acorporately owned businesses to individuals
Bpublicly held stock to private individuals.
Cgovernment businesses to the private sector
Dprivately owned businesses to the government sector
7
A firm charging different buyers’ different prices for the same product is practicing ?
ACompetitive pricing.
BPrice discrimination
Cprice discounting.
Dprice fixing.
8
A merger in which firms at various stages in a production process combine is a ?
Aproduction merger
Bvertical merger
Cconglomerate merger.
Dhorizontal merger
9
A merger between a paper producer and a book publisher is an example of?
Aa conglomerate merger.
Ba horizontal merger
Ca complementary products merger.
Da vertical merger
10
A horizontal merger is a merger of?
Afirms producing unrelated products
Bfirms producing complementary products
Cfirms at various stages in a production process.
Dfirms producing the same product