All Free Economics MCQs with Answers

• A. encourages mechanization
• B. allows the farmers to set the prices for their agricultural products
• C. enables farmers to escape the problem of diminishing return
• D. makes farmers owners of the land instead of tenants and owners' farmers are more productive than tenant farmers

Explanation: Land reform can raise output by giving cultivators secure ownership, making them more willing to invest effort and resources in the land.

• A. shortages of inputs including land
• B. an over-investment in farm equipment
• C. migration from rural areas to urban areas
• D. a lack of effective demand for food products

Explanation: Agricultural productivity is commonly limited by inadequate inputs such as improved seeds, fertiliser, irrigation, credit and suitable…

• A. stress agricultural development over industrial development
• B. promote industrial development over agriculture
• C. use a balanced strategy that promotes both agricultural and industrial development
• D. stress the importation of agricultural products and the export of manufactured goods

Explanation: Development requires complementary growth in agriculture and industry: agriculture supplies food, employment and raw materials, while…

• A. the vicious circle of poverty hypothesis
• B. the dependency theory
• C. neo-colonialism
• D. the under-consumptionist hypothesis

Explanation: The vicious circle of poverty describes how low income leads to low saving and investment, which keeps productivity and income low.

• A. export promotion
• B. industrial promotion
• C. import substitution
• D. unbalanced growth

Explanation: Import substitution means producing domestically the goods that were previously imported, usually through protection or other support for…

• A. 40%
• B. 10%
• C. 20%
• D. 30%

Explanation: The 85% figure refers to the population of developing countries receiving only about one-fifth of global income, highlighting the severe…

• A. the newly industrialized countries like Korea, Taiwan Malaysia
• B. The republics of the former Soviet Union
• C. Countries that still have a communist government like China and Cuba
• D. countries that have fallen far behind the economic advances of the rest of the world

Explanation: The Fourth World refers to countries or populations left far behind even the broader group of developing countries in economic and social…

• A. The brain drain
• B. human capital deterioration
• C. productivity
• D. labor degradation

Explanation: The migration of doctors, engineers, scientists and other highly trained workers from poorer to richer countries is called brain drain.

• A. natural resources
• B. body of knowledge
• C. land
• D. quantity of labor

Explanation: Kuznets emphasized that advanced economies depend mainly on accumulated knowledge, skills and technology rather than merely on physical…

• A. Public expenditure per student for higher education is about ten times as high as for primary education
• B. The expansion of primary education redistributes benefits from the rich to the poor
• C. Economists unanimously agree that LDCs should put greater priority on primary education
• D. Boys are sent to schools far more often than girls

Explanation: Economists recognize the importance of primary education, but they do not agree unanimously on every education-priority policy in LDCs.

• A. About 18 percent of the world's deaths are among children less than five years old
• B. More than 98 percent of child deaths were in LDCs
• C. World-wide child mortality rates increased from 1990 to 2002
• D. 19 of the 20 countries with the highest child mortality were in Africa

Explanation: Global child mortality generally declined between 1990 and 2002, although progress was uneven across countries.

• A. 17 million, 7 million
• B. 7 million, 0.7 million
• C. 3 million, 1 million
• D. 0.5 million, 5 million

Explanation: In 2002, stroke and heart disease accounted for roughly 17 million deaths worldwide, while cancer caused about 7 million.

• A. due to a lack of education
• B. a class system in which the elite are contemptuous of manual work
• C. upper-and middle-class westerners
• D. The lack of bargaining power y cheap labor

Explanation: Myrdal argued that social attitudes can suppress productivity when elites look down on manual work and fail to encourage improvements in…

• A. 30 to 40 years, about the same as in 1995
• B. 30 to 40 years, a fall of more than 10 years from 1995
• C. 50 to 60 years, about the same as in 1995
• D. 70 years, an increase from 1995

Explanation: The forecast reflected the severe impact of HIV/AIDS in southern Africa: life expectancy in Botswana and South Africa was expected to fall…

• A. high formal education and training
• B. better health and physical condition of the labor force
• C. Both a and b are correct
• D. None of the above is correct

Explanation: Higher formal education and training improve workers’ skills, while better health raises their physical and mental capacity to work.

• A. mortality-adjusted lifelong
• B. premature living age
• C. life mortality-fertility ratio
• D. disability-adjusted life years

Explanation: A disability-adjusted life year, or DALY, combines years lost because of premature death with years lived with disability.

• A. individuals pay the full cost of their education
• B. government subsidizes schooling
• C. education persons migrate more
• D. capital and unskilled labor are complements

Explanation: The marginal product model treats education as an investment whose cost is borne by the individual, justified by the higher future…

• A. 60 million
• B. 10 million
• C. 3 million
• D. million

Explanation: The estimate was about 3 million African internet users out of roughly 360 million worldwide users in 2000.

• A. when marginal revenue productivity of labor is zero
• B. the same as seasonal unemployment of LDC agricultural
• C. the rigid factor proportions in LDC agriculture and industry
• D. due to capital formation and the level of technology remaining constant.

Explanation: Disguised unemployment exists when some workers add nothing to total output, so their marginal revenue product is zero.

• A. disguised unemployed
• B. cyclical unemployed
• C. seasonally unemployed
• D. voluntarily unemployed

Explanation: Disguised unemployment can include workers pushed into jobs below their skills or previous level of employment, a pattern seen during…