Adam smith’s invisible hand concept suggests that a competitive market outcome ?

Related Mcqs:

1. The Ultimate effect of the invisible hand of Adam Smith is that in a competitive economy everyone ?

   A. benefits if each acts in his/her own interest
   B. will increase their profits in a free market
   C. should act to maximize economic growth
   D. should act to promote the public interest

2. Suppose that 40 percent of the voting population wish to spent Rs1,000 for artwork in City Hall, 25 percent wish to spent Rs20,000 and 35 percent wish to spend Rs 22,000 What is the median preferred outcome, the average preferred outcome and the modal preferred outcome ?

   A. Rs20,000; Rs20,000; Rs22,000
   B. Rs1,000; Rs14,333; Rs1,000
   C. Rs20,000; Rs13,100; Rs1,000
   D. Rs1,000; Rs20,000; Rs22,000

3. Which of the following is true under pairwise majority rule if people vote for the outcome closest to their most preferred outcome ?

   A. The average preferred outcome wins
   B. There is no clear winner due to Arrow’s Impossibility Theorem.
   C. The outcome preferred by the median voter wins
   D. The outcome preferred by the greatest number of voters wins.

4. Adam Smith advocated ?

   I- laissez faire
   II- the invisible hand
   III- free trade policy
   IV- competitive markets

   A. I and II only
   B. II and III only
   C. I , II and III only
   D. I , II , III and IV

5. Adam Smith was __________?

   A. An Economist
   B. A scientist
   C. A philosopher
   D. None of these

   Submitted by: Shahbaz Jiskani

6. The market for hand tools (such as hammers and screwdrivers) is dominated by Draper Stanley, and Craftsman This market is best described as ?

   A. monopolistically competitive
   B. a monopoly
   C. an oligopoly
   D. competitive

7. When one firm in the breakfast cereal market started an advertising campaign that stressed the nutritional value of its cereals, all other cereal manufacturers started similar advertising campaign This suggests that the breakfast cereal market is ?

   A. monopolistically competitive
   B. oligopolistic
   C. perfectly competitive
   D. indeterminate from this information

8. Compared to a perfectly competitive market a monopoly market will usually generate ?

   A. higher prices and lower output
   B. higher prices and higher output
   C. lower prices and lower output
   D. lower prices and higher output

9. Which of the following market would most closely satisfy the requirements for a competitive market ?

   A. electricity
   B. cable television
   C. cola
   D. milk
   E. All of these answers represent competitive markets

10. Which of the following is true regarding the production and pricing decisions of monopolistically competitive firms? Monopolistically competitive firms choose the quantity at which marginal cost equals ?

    A. marginal revenue and then use the demand curve to determine the price consistent with this quantity
    B. average total cost and then use the supply curve to determine the price consistent with this quantity
    C. marginal revenue and then use the supply curve to determine the price consistent with this quantity
    D. average total cost and then use the demand curve to determine the price consistent with this quantity