MCQS ON ECONOMICS Chater-1 A. Micro Economics 1. Principle of maximum social advantage is concerned with: a. Public expenditure b. Taxation only c. Public debt d. Above a & b ✓ Ans: d 2. If marginal propensity to import is 0.1 and Marginal propensity to consume is 0.7, the value of income multiplier will be... a.<1 b. >1✓ c.=0 d=1 Ans: 1/{=1-(MPI+MPC)} From above question MPI=0.1, and MPC=0.7 1/{1-(0.1+0.7)} 1/1-0.8. 1/0.2 10/2 5 Ans: b. 3. A toll tax is a tax based on which of the folowing: a. Horizontal equality . The benifit principle✓ c. Vertical Equality d. Tax progressively Ans: b 4.which of the following factors is Not the cause for Market Failure a. Public goods b. Externality c. Lack of Demand ✓ d. Symmetric information Ans: c 5. Liquidity approach is also known by the name:- a. Gurle...
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