Economics MCQs
Economics MCQs for CSS, PMS, and competitive exams covering microeconomics, macroeconomics, market structures, fiscal and monetary policy, development, and trade. Test conceptual clarity, analytical skills, and real-world application of economic principles.
Q: Elasticity of demand measures
A) Income level
B) Production rate
C) Supply increase
D) Responsiveness to price
✅ Correct Answer: D
Explanation: It quantifies how much demand changes in response to a price change.
Q: Opportunity cost refers to
A) Next best alternative
B) Extra expense
C) Total cost
D) Production cost
✅ Correct Answer: A
Explanation: It is the cost of forgoing the next best alternative when making a choice.
Q: An example of a fixed cost is
A) Raw material
B) Fuel cost
C) Rent
D) Electricity bill
✅ Correct Answer: C
Explanation: Fixed costs do not vary with production level and include rent.
Q: Macroeconomics studies
A) Consumer habits
B) Firm decisions
C) National economy
D) Individual choices
✅ Correct Answer: C
Explanation: It focuses on broad economic factors like inflation, GDP, and unemployment.
Q: GDP stands for
A) Global Domestic Policy
B) Gross Domestic Product
C) Government Development Plan
D) General Demand Price
✅ Correct Answer: B
Explanation: It represents the total market value of all goods and services produced in a country.