Roll Number:

Group:

Name
Thapar University Patiala
School of Humanities and Social Sciences

Quiz 2, Nov 28, 2015

Time: 10 Minutes;

Max. Marks: 10

PME-101: Micro Economics

Name of Faculty: RKS

1. If a change in all inputs leads to a proportional

change in the output, it is a case of
a. Increasing returns to scale
b. Constant returns to scale
c. Diminishing returns to scale
d. Variable returns to scale
e. Inefficient returns to scale.
2. If more output is produced with the same
inputs or same output is produced with less
inputs, then it is an example of
a. Product innovation
b. Process innovation
c. Increasing returns to scale
d. Both (a) and (c) above
e. Both (b) and (c) above.

7. Which of the following cost curves is not U

shaped?
a. Long run average cost curve
b. Long run marginal cost curve
c. Short run average cost curve
d. Average variable cost curve
e. Average fixed cost curve.

3. Isoquants are
a. Equal-cost lines
b. Equal-product lines
c. Equal-revenue lines
d. Equal-total utility lines
e. Equal-marginal utility lines.

9. The demand and supply functions of a product

are given by
Supply function : P = 0.2Qs 20
Demand function: P = 40 0.1Qd

4. Average product is defined as

a. Total cost divided by the total units of input
b. Total output divided by the total units of input
c. Total cost divided by total output
d. Total output divided by total cost of input
e. Total units of input divided by total output.
5. When average product is highest,
a. Total product is maximum
b. Marginal product is maximum
c. Marginal product is zero
d. Marginal product is negative
e. Marginal product is equal to average product.
6. Which of the following is true with respect to
average fixed cost?
a. It is a bell shaped curve.
b. As the quantity increases it approaches zero.
c. If quantity produced tends to zero, average
fixed cost approachs infinity.
d. Both (a) and (b) above.
e. Both (b) and (c) above.

8. Economic profit is
a. Accounting profit + Implicit cost
b. Accounting profit + Implicit cost + Explicit cost
c. Accounting profit Implicit cost
d. Accounting profit Implicit cost Explicit cost
e. Accounting profit Indirect costs.

If the government enforces a price floor of Rs.10

for the product
a. Excess supply of the product will be 150
b. Excess supply of the product will be 300
c. Shortage of the product will be 150
d. Shortage of the product will be 300
e. Price floor will not have any effect on the
market.
10. A price ceiling refers to the
a. Maximum price a seller charges for a
product/service
b. The price at which the profits of the seller are
maximized
c. The legal price a seller may charge for a
product/service
d. The maximum price the consumers are
affordable to pay
e. The maximum price the consumers are willing
to pay.