Economics · General Awareness

Economics Concepts and Theories

1,710 Questions

Review fundamental and advanced economics concepts through this structured question bank. The topics include macroeconomics, fiscal policy, international trade theories, and economic regulation. These questions are ideal for candidates preparing for civil services and other administrative competitive examinations.

Macroeconomics fundamentalsInternational trade theoriesFiscal policy debatesEconomic regulationLabor theory of value

Economics Concepts and Theories Questions

Multiple choice

Being skilled at a particular job

  1. farming

  2. art

  3. specialization

  4. tools
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Specialization refers to the development of skills in a specific area of work, which becomes possible when a society has a food surplus.

Multiple choice

What is the most influential and famous economics book ever?

  1. Wealth of Nations - Adam Smith

  2. Das Kapital - Karl Marx

  3. Leviathan - John Hobbes

  4. Principles of Political Economy and Taxation - David Ricardo
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Adam Smith's 'The Wealth of Nations' (1776) is widely considered the foundational text of modern economics and the first work to describe the principles of free-market capitalism.

Multiple choice

What does the term 'economic factors' include?

  1. Shoe size and height

  2. Weight

  3. Their job and money

  4. Yoga
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Economic factors relate to financial status and employment, which directly influence access to resources and quality of life.

Multiple choice

A false economy is when something appears .....

  1. cheaper but works out more expensive

  2. expensive but works out cheaper

  3. a fake country

  4. cheap and works out cheaper
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

A false economy occurs when an item is purchased because it is cheap, but it requires frequent replacement or repair, making it more expensive in the long run.

Multiple choice

What does prosperity mean?

  1. To lose your money

  2. To be wealthy

  3. To be proper

Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Prosperity is the state of being successful, flourishing, or wealthy. Losing money is the opposite, and being proper relates to behavior rather than financial status.

Multiple choice organisation of commerce and management constraints in economic development of rajasthan programmes for poverty eradication poverty : challenge facing india poverty as a challenge

Which of the following can be regarded as the laws of economics?

  1. There is a direct proportionate change in the price level with a change in the supply of money.

  2. Prices are determined by total demand and total supply in the market

  3. After a point the marginal increase in output shows a falling tendency with every increase in one or more of the factors of production.

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Economics laws are based on various assumptions which are necessary to follow while applying the law is as well as these laws can be applied only is some specific situation with given set of conditions. Moreover,  these economic laws are not rigid statements but their application depends upon the tendency of their implementation. Therefore, all of the above can be regarded as economic laws. 

Multiple choice economics constraints in economic development of rajasthan programmes for poverty eradication poverty : challenge facing india poverty as a challenge

Dr. Amartya Sen, an Indian Economist, won the Noble Prize for economics in $1998$ for ___________.

  1. welfare economics and social choice theory

  2. wealth concept of economics

  3. scarcity definition of economics

  4. political thoughts on economics
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Dr. Amartya Sen, an Indian Economist, won the Noble Prize for economics in 1998 for welfare economics and social choice theory. He had an interest in the lives of the poorest section of the society. He worked on human rights, poverty and inequality and tried to improve the well-being of the community.

Multiple choice economics constraints in economic development of rajasthan programmes for poverty eradication poverty : challenge facing india poverty as a challenge

Modern economist define economics as __________.

  1. science of growth and efficiency

  2. art of understanding consumer behaviour

  3. art of taking ration decisions

  4. science of rational behvaiour
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Modern economists define economics as the science of growth and efficiency as in the contemporary world economics focuses the rate of growth and how much the scarce resources are efficiently  used,that is, without wastage in order to derive the maximum utility.

Multiple choice economics constraints in economic development of rajasthan programmes for poverty eradication poverty : challenge facing india poverty as a challenge

Arrange the following in proper from: Stages as Economics developed as a subject:-
I.Material Welfare Definition
II.Wealth Definition
III.Development and Growth Definition
IV.Scarcity and Choice Definition
Select the correct answer from the options given below -

  1. II, I, IV, III

  2. I, II, III, IV

  3. IV, III, II, I

  4. II, III, I, IV
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

  • Adam Smith was a Scottish economist who described economics as a science which deals with the creation of wealth where wealth generation focused on the personal gains of the individual which was more of capitalist economy.
  • Alfred Marshall was a British economist who proposed the definition of welfare according to which material welfare focused on the materialistic gains in the economy.
  • Paul A Samuelson was an American economists who proposed many theories on income and its even distribution and how these two factors leads to growth and development of the nation. Development and growth is the modern macroeconomics which focuses on personal gain with social welfare.
  • Lionel Robbins was a British economist who proposed a very scientific definition on  economics where he described the importance of effective relationship between scarcity and choice is the modern microeconomics which focuses on unlimited wants and scarcity of resources.

Multiple choice economics constraints in economic development of rajasthan programmes for poverty eradication poverty : challenge facing india poverty as a challenge

Economics is the study of ___________.

  1. how society manages its unlimited resources

  2. how to reduce our wants until we are satisfied

  3. how society manages its scarce resources

  4. how to fully satisfy our unlimited wants
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Economics is the study that establishes an effective relationship between unlimited wants and scarce resources so that all the unlimited wants are mostly satisfied by the use of scarce resources. 
At micro level it deals with individual variables like consumer or producer and how they influence the market. 

At macro level it deals with the overall economic policies, aggregate variables of the economy.

Multiple choice geography basic problems of an economy introduction to natural resources (eco) understanding development: perspectives, measurement and sustainability resources - types and conservation

An economy can spend all its present resources on current consumption only.

  1. True

  2. False

  3. Partially True

  4. Cannot be commended at all
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

An economy must allocate resources between current consumption and investment (saving) to ensure future growth. Spending all resources on current consumption would leave nothing for capital formation, which is unsustainable.

Multiple choice geography basic problems of an economy introduction to natural resources (eco) understanding development: perspectives, measurement and sustainability resources - types and conservation

If there are adequate resources in an economy, then there is no economic problem at all. This statement is?

  1. True

  2. False

  3. Partially True

  4. Cannot be commented at all
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The economic problem arises because human wants are unlimited while resources are limited. Even if resources were abundant, the problem of choice would persist as long as wants remain unsatisfied.