Economics MCQs
Topic Notes: Economics
MCQs and preparation resources for competitive exams, covering important concepts, past papers, and detailed explanations.
Plato
- Biography: Ancient Greek philosopher (427–347 BCE), student of Socrates and teacher of Aristotle, founder of the Academy in Athens.
- Important Ideas:
- Theory of Forms
- Philosopher-King
- Ideal State
31
Which characteristics are commonly associated with female-headed households?
Answer:
all of the above
Female-headed households have seen a significant rise since 1970 due to various social and economic factors. These households frequently face economic challenges, including lower median incomes compared to dual-parent families, and often report higher levels of emotional and psychological stress as the primary caregiver manages both financial responsibilities and child-rearing duties independently.
32
According to the provided figure, what is the total size of the labor force?
Answer:
98.0 million
The labor force is defined as the sum of all individuals who are currently employed and those who are unemployed but actively seeking work. It excludes those who are not looking for work, such as retirees, students, or discouraged workers. The figure provided indicates a labor force of 98.0 million.
33
When employment levels fluctuate due to predictable changes in demand based on the time of year, what is this type of unemployment called?
Answer:
seasonal
Seasonal unemployment occurs when industries or sectors experience predictable fluctuations in demand based on the time of year. For example, tourism, agriculture, and retail often see hiring spikes and subsequent layoffs tied to specific seasons, leaving workers temporarily without employment during the off-peak periods.
34
What is a potential unintended consequence of increasing industrial production to boost urban employment, as suggested by the Harris-Todaro model?
Answer:
leads to the adoption of capital-intensive technologies
The Harris-Todaro model highlights that urban wage rigidities and the migration response can lead to persistent unemployment. If industrial expansion is accompanied by policies that make capital relatively cheaper or labor more expensive, firms may shift toward capital-intensive production methods. This reduces the labor-absorptive capacity of the industrial sector, potentially worsening urban unemployment despite increased output.
35
Which of the following scenarios is encompassed by the term 'unemployed'?
Answer:
All of them
In broad economic terms, unemployment can include underemployment, where individuals are working in jobs that do not fully utilize their skills or provide sufficient hours. While standard definitions often focus on those actively seeking work, the term is frequently used to describe various forms of labor underutilization.
36
Which of the following best describes the economic definition of unemployment?
Answer:
at the going wage rate, there are people who want to work but cannot find work.
Unemployment occurs when individuals who are actively seeking employment and are willing to work at the prevailing market wage rate are unable to secure a job. This represents a failure of the labor market to clear, meaning the quantity of labor supplied exceeds the quantity of labor demanded at that specific wage level.