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Economics Mcqs 4423 MCQs [All-Courses]

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Economics MCQs cover fundamental concepts of microeconomics and macroeconomics, including demand and supply, inflation, national income, and economic policies.
This section is designed to strengthen analytical skills and conceptual understanding for competitive examinations.
Highly useful for PPSC, FPSC, NTS, OTS, KPPSC, and other testing services preparation.

All Topics  4423

The average tax rate is ?
A total taxes paid divided by total income
B the extra taxes paid on an additional dollar or income.
C the taxes paid by the marginal worker
D total income divided by total taxes paid
Correct Answer: total taxes paid divided by total income
The marginal tax rate is ?
A the taxes paid by the marginal worker
B total income divided by total taxes paid
C the extra taxes paid on an additional unit of income
D total taxes paid divided by total income
Correct Answer: the extra taxes paid on an additional unit of income
A tax for which high income taxpayers pay a smaller fraction of their income than do low income taxpayers is known as ?
A a proportional tax
B a regressive tax
C an equitable tax
D a progressive tax
Correct Answer: a regressive tax
If the Pakistani government runs a budget surplus there is ?
A an excess of government receipts over government spending.
B an equality of government spending and receipts.
C a surplus of government workers.
D an excess of government spending over government receipts.
Correct Answer: an excess of government receipts over government spending.
The reduction of tax ?
A will have no impact on tax revenue.
B will always reduce tax revenue regardless of the prior size of the tax
C could increase tax revenue if the tax had been extremely high
D causes a market to become less efficient
Correct Answer: could increase tax revenue if the tax had been extremely high
The graph that shows the relationship between the size of a tax and the tax revenue collected by the government is known as a ?
A none of these answers
B Reagan curve
C Keynesian curve
D Laffer curve
Correct Answer: Laffer curve
Which of the following is true with regard to a tax on labor income? Taxes on labor income tend to encourage ?
A the unscrupulous to enter the underground economy
B the elderly to retire early.
C all the things described in these answers.
D second earners to stay home.
Correct Answer: all the things described in these answers.
Deadweight loss is greatest when ?
A supply is elastic, and demand is perfectly inelastic
B demand is elastic, and demand is perfectly inelastic
C both supply and demand are relatively inelastic
D both supply and demand are relatively elastic
Correct Answer: both supply and demand are relatively elastic
Which of the following would likely cause the greatest deadweight loss ?
A a tax on salt
B a tax on cigarettes
C a tax on petrol
D a tax on cruise line tickets
Correct Answer: a tax on cruise line tickets
Refer to Exhibit 4. If a tax is placed on the product in this market. deadweight loss is the area ?
A B + C + E + F
B E + F
C B + C
D A + B + C + D
Correct Answer: E + F
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