RAHUL’S CA ACADEMY
Business Economics – Test No - 1
Topic Covered: Introduction to Business Economics Nature, Scope,
Basic Problems and Role of Price Mechanism
1. Business Economics applies economic tools in the process of
(a) Decision making (b) Allocation of resources (c) Micro aspects (d) Macro Aspects
2. Who defined Business economics as the use of economic analysis in the formulation of business policies.
(a) Marshall (b) Joel Dean (c) Robinson (d) Keynes
3. Business Economics is essentially a component of applied economics as it includes application of selected quantitative
techniques. Which technique is not included in it?
(a) cost analysis (b) break even analysis (c)Economic analysis (d) linear programming
4. Economics today not only deals with scarce resources and their allocation but management of
(a) Prices (b)Fluctuations (c) Capital (d) Savings
5. Business Economics integrates
(a) Economic theory with business practice (b) Society and economic theory
(c) Business and politics (d) Business Economics and Social Sciences
6. Which among the following is not a part of business Economics?
(a)Accounting Standards (b) Capital Budgeting (c)Business Cycles (d) Risk Analysis
7. Micro Economics was popularized by
(a) Joel Dean (b) Alfred Marshall (c) Schumpeter (d) Benham
8. The level of employment and rate of economic growth
(a) Growth Concepts (b) Macro Concepts (c) Micro Concepts (d) Planning Concepts
9. Other things remaining constant – Its equivalent in Latin is
(a)Vis-a-vis (b) Ceteris Paribus (c) Sine qua non (d) Laissez Faire
10. Macro Economics was popularized by
(a) M. Keynes (b) Joel Dean (c) Alfred Marshall (d) Schumpeter
11. Location of industry is studied included under
(a) Micro Economics (b) Macro Economics (c) Managerial Economics (d) Business Economics
12. Business Economics is pragmatic in its approach as it tackles business problems
(a) Practically (b) Methodically (c) Scientifically (d) Systematically
13. Identify the normative sentence.
(a) Robins definition is accepted universally (b) Samuelsson’s is the most superior definition.
(c) Welfare is superior to the Wealth definition. (d) Smith should have emphasized less on wealth.
14. Goods which satisfy human wants indirectly
(a)Consumption Goods (b)Personal Goods (c) Impersonal Goods (d)Producer Goods
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15. The concept of Command Economy was profounded by
(a) Karl Marx (b)Bohm Bewerk (c) Marshall (d)Benham
16. ____________ economics explain economic phenomenon according to their cause and effects.
(a) Applied (b) Empirical (c) Positive (d) Normative
17. A capital surplus country uses which technology?
(a) Capital –intensive (b) Labour-intensive (c) Both (d) Neither
18. Co-existence of Public and private sector is the feature of which economy
(a) Capitalist (b) Socialist (c) Mixed (d) Command
19. Absence of consumer choice is a feature of ____________
(a) Socialism (b) Capitalism (c) Mixed (d) Both a and b
20. Which is the heart of capitalism?
(a) Profit (b) Price (c) Private Property (d) Competition
21. Spot the odd one out.
(a) Factor pricing (b) Balance of trade. (C) Money (d) National Income
22. Due to recession, employment rate and output
(a)Rises ; rises (b)Rises ; falls (c)Falls; rises (d)Falls ; falls
23. What “ ought to be” Is studied under
(a) Micro (b) Macro (c) Positive (d) Normative
24. The economic system in which the government has complete control over the prices
(a) Market (b)Mixed Economy (c) Command economy (d) Regulated economy
25. Inequalities is the demerit of
(a) Free Market Economy (b)Mixed Economy (c) Command economy (d) Regulated economy
26. Indian economy is a
(a) Market (b) Mixed Economy (c) Command economy (d) Regulated economy
27. Macro-Economics is also called
(a) Applied Economics (b) Experimental Economics
(c) Aggregate Economics (d) None of the above
28. In a mixed economy there are _________ sector of industries
(a) Three (b) Two (c) Four (d) Five
29. Economics concerned with welfare propositions is called
(a) Socialist economics (b) Normative Economics
(c) Positive Economics (d) Capitalistic economics
30. Scarcity Definition in economics is given by
(a)Robbins (b) J B Say (c) Adams smith (d) Samuelson.
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31. In which economy, all economic decisions are guided by self-interest and price mechanism?
(a) Command Economy (b) Laissez Faire (c) Planned Economy (d) Classless Economy
32. Socialist Economy is also called
(a) Command Economy (b) Laissez Faire (c) Free market Economy (d) Perfectly Competitive Economy
33. Identify the Micro Economic aspect
(a) The type of economic system (b) The stage of business cycle
(c) Trends in national income, employment, saving, investment and pricing (d) Risk and uncertainty analysis
34. Identify the Macro Economic aspect
(a) Resource allocation (b) Demand forecasting (c) Inventory Management (d) Business Cycles
35. Micro Economics is applied to
(a) External issues (b) Operational issues (c) Environmental issues (d) None
36. Predicting the future demand based on past consumer behavior is
(a) Supply function (b) Demand function (c) Demand Schedule (d) Demand Forecasting
37. Proper allocation of funds forms the subject matter of
(a) Micro (b) Macro (c) Deductive (d) Inductive
38. Administered prices refer to
(a) Prices determined by demand and supply (b) Price determined by market economy
(c) Prices determined by external forces like government (d) Prices at the ration shops
39. Exploitation and inequality are minimal under
(a) Capitalism (b) Socialism (c) Mixed Economy (d) Free market economy
40. Freedom of choice is the advantage of
(a) Capitalism (b) Socialism (c) Mixed Economy (d) Command economy
41. The economic system which has both profit and welfare as its goals
(a) Capitalism (b) Socialism (c) Mixed Economy (d) Free market economy
42. Which of the following statements is incorrect
(a) Business Economics is normative in nature (b) Business Economics has close connections with Statistics
(c) Business economist need not worry about Micro economic variables
(d) Business Economics is also called Managerial Economics
43. Larger production of which goods lead to higher production in future
(a) Consumer Goods (b) Capital Goods (c) Agricultural Goods (d) Public Goods
44. The central problem of Economics is
(a) Optimum production
(b) Command versus market economies
(c) Allocating the scarce resources such that society’s unlimited wants are satisfied in the best possible manner
(d) Guaranteeing a minimum standard for citizens
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45. Which of the following is not the central problem of Economics
(a) Who produces what (b) When are goods produced (c) How to produce (d) For whom to produce
46. The most important demerit of capitalism is
(a) Inequalities (b) Absence of greater freedom (c) Classless society (d) Absence of welfare motive
47. Who defined economics in terms of Dynamic growth and development?
(a) Alfred Marshall (b) Robbins (c) Adams smith (d) Paul.A.Samuelson
48. Which of the following is not in the scope of Micro Economics
(a) Should the firm be in business? (b) How much should be produced?
(c) At what price? (d) How to decrease unemployment?
49. Business Economics
(a) Applies the tools of Micro Economics (b) Incorporates tools from multiple disciplines
(c) Practical application of economic theory (d) All of the above
50. Economic laws are
(a) Statement of economic tendencies (b) Statement of consumer behavior
(c) Accepted norms in a society (d) Guidelines of a free market economy
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