Economics

Economics MCQs with Answers and Explanations | Microeconomics & Macroeconomics Objective Questions.

Strengthen your knowledge of Economics with a rich collection of MCQs with answers and detailed explanations. Topics include microeconomics, macroeconomics, demand and supply, national income, inflation, monetary policy, fiscal policy, international trade, economic growth, and development economics. These multiple-choice questions are designed for students, teachers, and candidates preparing for competitive exams (CSS, PMS, NTS, FPSC, PPSC, UPSC, MBA, BBA, etc.). Each MCQ is supported by a clear solution and explanation to improve conceptual clarity, analytical ability, and exam performance. Perfect for self-assessment, practice, and revision in the field of Economics.

22. Which one of the following is true about Planning Commission?

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A) It is a Ministry
B) It is a Government Department
C) It is an Advisory Body
D) It is an Autonomous Corporation
✅ ANSWER: C
Planning Commission is an Advisory Body. The Planning Commission is a non-constitutional and non-statutory body and is responsible to formulate five years plan for social and economic development in India.

23. Supply curve is

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A) Vertical in long run
B) Flatter in long run
C) Same in long and short run
D) Horizontal in both short and long run
✅ ANSWER: B
Supply curve is Flatter in long run. All firms have identical cost conditions. Hence, in the case of a constant cost industry, the long-run supply curve LSC is a horizontal straight line (i.e., perfectly elastic) at the price OP, which is equal to the minimum average cost. This means that whatever the output supplied, the price would remain the same.

24. The major difference between perfect competition and monopolistic competition is

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A) Number of firms
B) Differentiated product
C) Rate of profit
D) Free exit and entry
✅ ANSWER: B
The major difference between perfect competition and monopolistic competition is differentiated product. Product differentiation (or simply differentiation) is the process of distinguishing a product or service from others, to make it more attractive to a particular target market. This involves differentiating it from competitors’ products as well as a firm’s own products.

29. “The real price of everything, what every thing really costs to the man who wants to require it, is the toil and trouble of acquiring it. Who made this statement?

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A) Karl Marx
B) Adam Smith
C) David Ricardo
D) J.S.Mill
✅ ANSWER: C
“The real price of everything, what every thing really costs to the man who wants to require it, is the toil and trouble of acquiring it. David Ricardo made this statement.