Principles of Economics Exam Questions
| SECTION | QUESTIONS |
|---|---|
| SECTION A: FOUNDATIONS OF ECONOMICS (1–8) | 1. Define economics and explain its scope. 2. Explain the problem of scarcity and choice. 3. Describe opportunity cost with examples. 4. Distinguish between microeconomics and macroeconomics. 5. Explain the production possibility curve (PPC) and its assumptions. 6. Differentiate between positive and normative economics. 7. Compare planned, free market and mixed economies. 8. Explain consumer sovereignty and its limitations. |
| SECTION B: DEMAND, SUPPLY & ELASTICITY (9–18) | 9. State and explain the law of demand. 10. Explain factors affecting demand. 11. Distinguish between movement and shift in the demand curve. 12. Define elasticity of demand and explain its types. 13. Calculate price elasticity of demand. 14. Explain factors affecting elasticity of demand. 15. Define supply and explain determinants of supply. 16. Explain elasticity of supply and its importance. 17. Determine equilibrium price using demand and supply functions. 18. Explain effects of taxes and subsidies on equilibrium. |
| SECTION C: CONSUMER BEHAVIOUR (19–25) | 19. Explain the law of diminishing marginal utility. 20. Distinguish between cardinal and ordinal utility approaches. 21. Explain indifference curves and their properties. 22. Define consumer equilibrium using indifference curve analysis. 23. Explain income and substitution effects. 24. Derive a demand curve using indifference curves. 55. Explain consumer surplus and its significance. |
| SECTION D: PRODUCTION THEORY (26–32) | 26. Define factors of production and explain their mobility. 27. Explain the law of diminishing returns. 28. Distinguish between short run and long run production. 29. Explain isoquants and isocost lines. 30. Determine producer equilibrium. 31. Explain returns to scale. 32. Describe wage determination using demand and supply of labour. |
| SECTION E: COST THEORY (33–36) | 33. Define and distinguish fixed and variable costs. 34. Explain short-run cost curves. 35. Explain long-run cost curves. 36. Describe economies and diseconomies of scale. |
| SECTION F: MARKET STRUCTURES (37–42) | 37. Define a market and classify market structures. 38. Explain characteristics of perfect competition. 39. Explain monopoly and its pricing decisions. 40. Distinguish between monopoly and monopolistic competition 41. Explain oligopoly and its features. 42. Determine profit maximization using TR and TC approach. |
| SECTION G: MACROECONOMICS (43–50) | 43. Define national income and explain methods of measurement. 44. Distinguish between GDP, GNP and NNP. 45. Explain the circular flow of income. 46. Explain consumption, saving and investment functions. 47. Define inflation and explain its causes and control measures. 48. Explain unemployment and its types. 49. Describe functions of money and demand for money theories. 50.Explain the role of the central bank and monetary policy tools. |
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- At least 70% of these questions appear in one form or another
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