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100+ Free PSEB SS Economics Practice Questions

Punjab School Education Board (PSEB) Senior Secondary Economics (Class 12 — Economics elective, subject code 026) practice questions are available now; exam metadata is being verified.

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2026 Statistics

Key Facts: PSEB SS Economics Exam

3 hours

PSEB Class 12 Economics theory exam duration

PSEB Class 12 Economics syllabus

80 + 20

Theory marks + Internal Assessment including project work

PSEB Class 12 Economics syllabus / Scheme of Studies

33%

Minimum theory (and aggregate) pass floor under PSEB Scheme of Studies

PSEB Scheme of Studies Senior Secondary

Code 026

Economics subject code on PSEB Senior Secondary scheme

PSEB Scheme of Studies

Micro + Macro

Part A Introductory Microeconomics and Part B Introductory Macroeconomics

PSEB Class 12 Economics syllabus PDF

PSEB Senior Secondary Economics (code 026) is a Class 12 public-exam theory elective of 3 hours (Theory 80 + INA 20) with a 33% scheme pass floor, covering introductory micro and macro — not a pure MCQ board paper. This free 2026 bank is an English MCQ study adaptation for PSEB Class 12 Economics concepts and calculations.

Sample PSEB SS Economics Practice Questions

Try these sample questions to test your PSEB SS Economics exam readiness. Each question includes a detailed explanation. Start the interactive quiz above for the full 100+ question experience with AI tutoring.

1The central problems of an economy arise mainly because:
A.Resources are scarce relative to unlimited wants
B.All goods are free gifts of nature
C.Governments always fix every market price
D.Money supply always exceeds the supply of goods
Explanation: Scarcity of resources against unlimited wants forces every economy to decide what, how, and for whom to produce. These allocation choices are the central economic problems.
2Which of the following is a microeconomic study?
A.Pricing of wheat in a local mandi market
B.Growth rate of national income over a decade
C.Aggregate unemployment rate for the country
D.Overall inflation measured by the consumer price index
Explanation: Microeconomics studies individual units such as a consumer, firm, or product market. Pricing of wheat in one market is a micro topic; the other options are macroeconomic aggregates.
3Opportunity cost of a decision is best defined as:
A.The value of the next-best alternative foregone
B.The total money cost paid for all inputs used
C.Only the explicit accounting cost of production
D.The sum of all past sunk costs already incurred
Explanation: Opportunity cost is the benefit of the best alternative given up when a choice is made. It is a real-cost concept used throughout Class 12 microeconomics.
4A production possibility frontier (PPF) that is concave (bowed out) from the origin reflects:
A.Increasing opportunity cost as resources are reallocated between goods
B.Constant opportunity cost along the entire frontier
C.Decreasing opportunity cost of the good on the horizontal axis only
D.That the economy has unlimited resources
Explanation: Concavity of the PPF shows that resources are not equally suited to all uses, so opportunity cost rises as more of one good is produced. A straight-line PPF would show constant opportunity cost.
5A point inside the production possibility frontier indicates that the economy is:
A.Using resources inefficiently or leaving some resources idle
B.Producing more than is technologically possible
C.Operating with zero opportunity cost for every good
D.Beyond full employment of all resources
Explanation: Feasible points inside the PPF mean the economy can still increase output of one or both goods by using idle resources or improving allocation. Points on the frontier are efficient; points outside are unattainable with current resources and technology.
6An economy produces only food and cloth. Moving from (food 100, cloth 40) to (food 80, cloth 50) along the PPF, the opportunity cost of 10 extra cloth units is:
A.20 units of food
B.10 units of food
C.50 units of food
D.80 units of food
Explanation: Food falls by 20 (100−80) while cloth rises by 10 (50−40). The opportunity cost of the additional 10 cloth is therefore 20 units of food.
7Which statement is a positive economic statement?
A.India’s GDP grew by about 7% last year
B.The government ought to raise the minimum wage
C.Everyone should have free higher education
D.Tax rates on luxury goods should be higher
Explanation: Positive statements describe what is and can be tested with data. Normative statements involve value judgments about what ought to be (options about should/ought).
8In a market economy, the basic economic problems are largely solved by:
A.Price signals and voluntary exchange in markets
B.A central planning authority allocating every input
C.Random distribution of all goods by lottery
D.Complete prohibition of private property
Explanation: In a market economy, prices convey scarcity and preferences; producers and consumers respond, allocating resources through exchange. A centrally planned economy relies primarily on directives rather than price signals.
9According to the law of diminishing marginal utility, as a consumer consumes more units of a good in a given period:
A.Marginal utility from successive units eventually declines
B.Total utility always falls with every extra unit
C.Marginal utility always remains constant
D.Price of the good automatically rises
Explanation: Diminishing MU means each additional unit yields less extra satisfaction than the previous one (after a point). Total utility can still rise while MU falls, as long as MU is positive.
10Under the cardinal utility approach, a consumer buying two goods X and Y maximises satisfaction when:
A.MUx/Px = MUy/Py (and the budget is exhausted)
B.MUx = MUy regardless of prices
C.Px = Py for both goods
D.Total utility of X equals total utility of Y
Explanation: Consumer equilibrium requires equalising marginal utility per rupee across goods (MUx/Px = MUy/Py) while spending the full budget. That equalises bang-for-the-buck on each good.

About the PSEB SS Economics Practice Questions

Verified exam format metadata for Punjab School Education Board (PSEB) Senior Secondary Economics (Class 12 — Economics elective, subject code 026) is pending. The practice questions above remain available while official exam length, timing, passing score, fee, and administrator details are reviewed.