1-Demand is determined by
a. Price of the product
b. Relative prices of other goods
c. Tastes and habits
d. All of the above
(Ans: d)
2-When a firms average revenue is equal to its average cost, it gets ________.
a. Super profit
b. Normal profit
c. Sub normal profit
d. None of the above
(Ans: b)
4-Given the price, if the cost of production increases because of higher price of raw
materials, the supply
a. Decreases
b. Increases
c. Remains same
d. Any of the above
(Ans: a)
6-A Joint Stock Company is managed by the Board of Directors elected by _____ .
a. Top management
b. Shareholders
c. Employees of company
d. None of the above
(Ans: b)
7-Under ______, price is determined by the interaction of total demand and total supply
in the market.
a. Perfect competition
b. Monopoly
c. Imperfect competition
d. All of the above
(Ans: a)
8-Under perfect competition, price is determined by the interaction of total demand and
________.
a. Total supply
b. Total cost
c. Total utility
d. Total production
(Ans: a)
11-Distinction between private sector and public sector is determined on the basis of
a. Economic system
b. Motive
c. Principle of pricing
d. All of the above
(Ans: d)
1:
The concept of supply curve as used in economic theory is relevant only for the case of
A. Oligopoly competition
B. Perfect or pure competition
C. Monopolistic competition
D. Monopoly
Answer Report Discuss
Option: B
Explanation :
2:
Match the following :
Explanation :
3:
Other things being equal, an increase in supply can be caused by
Explanation :
4:
Match the following :
(B) Decreasing cost industry 2. Positively sloped long run supply curve
(C) Constant cost industry 3. Negatively sloped long run supply curve
3 2 1
B.(A) (B) (C)
1 2 3
C.(A) (B) (C)
2 3 1
D.(A) (B) (C)
2 1 3
Answer Report Discuss
Option: C
Explanation :
5:
Direct regulation of business has the potential to yield economic benefits to society when
Explanation :
6:
The Revealed Preference Theory is based on
A.Introspection
B.Utility and demand
C.The assumption of indifference
D.Observed consumer
behaviour
Answer Report Discuss
Option: D
Explanation :
7:
One would expect a firm to close down rather than continue producing in the short-period if
Explanation :
8:
Marginal Utility (MU) curve is always
A.Parallel to X-axis
B.Falling
C.Rising
D.Parallel to Y-axis
Answer Report Discuss
Option: B
Explanation :
9:
The Law of Diminishing Returns depends on the assumption that
Explanation :
10:
MRn = TRn - TRn_1 is the algebraic expression of
A Information is insufficient
.
B.Marginal Revenue, the change in total revenue when there is a change in
quantity sold of the product.
C The addition to TR earned by selling n units of product instead of (n-1) units
.
D None of the above
.
Answer Report Discuss
Option: B
Explanation :
1:
Under perfect competition a firm can produce with
Explanation :
12:
If marginal cost is above average variable at a time when output is rising, then
Explanation :
13:
Equilibrium of monopolist will never lie below the middle point of the average revenue curve
because below the middle point
Explanation :
14:
The concept of indifference curve analysis was given scientific touch by
A.Slutsky in 1915
B.F. Y. Edgeworth in 1881
C.Irving Fisher in 1982
D.Alfred Marshall in 1921
Answer Report Discuss
Option: B
Explanation :
15:
In monopoly, the relationship between average revenue and marginal revenue curves is as follows :
Explanation :
16:
Any supply curve which is a straight line passing through the origin whatever its slopes will
possess
Explanation :
17:
A monopoly producer has
Explanation :
18:
On an indifference map, higher indifference curves show
Explanation :
19:
Which of the following is the correct statement?
(3) The elasticity of substitution between two inputs x and y is proportionate change in the ratio of
two inputs divided by proportionate change in the MRTS.
(4) If degree of homogeneity is greater than one, the production function is increasing returns to
fixed factor
A.2, 3 and 4
B.1, 3 and 4
C.1, 2, 3
D.1, 2 and 3
Answer Report Discuss
Option: D
Explanation :
20:
When the TR curve and TC curve are parallel and TR exceeds TC
Explanation :
21:
A circumstance in which it might pay a monopolist to cut the price of his product is where
A.MC is falling
B.MR is greater than MC
C.His advertising costs are
increasing
D.Average costs seem about to fall
Answer Report Discuss
Option: A
Explanation :
22:
From the resource allocation view point, perfect competition is preferable because
Explanation :
23:
Put into chronological order on the basis of development:
1. Law of demand
2. Law of indifference
5. Indifference curve
A.1 3 4 2 5
B.1 5 3 4 2
C.1 3 2 5 4
D.1 2 3 4 5
Answer Report Discuss
Option: C
Explanation :
24:
The falling part of a TU curve shows
Explanation :
25:
Given the cost conditions
A.Monopoly output will be higher and prices lower than under pure
competition
B.Monopoly output will be lower and price higher than under pure competition
C.Monopoly output and price will be higher than under pure competition
D.Monopoly output and price will be lower than under pure competition
Answer Report Discuss
Option: B
Explanation :
27:
'The increasing returns to scale occurs because larger scale provides greater specialisation to
various factors' according to
A.Paul A. Samuelson
B.Alfred Marshall
C.Chamberlain
D.Joan Robinson
Answer Report Discuss
Option: C
Explanation :
28:
The change in TR resulting from the sale of one unit more of output, means
Explanation :
29:
Price effect in indifference curve analysis arises
A When the consumer becomes either better off or worse off because price
. change is not compensated by income change.
B.When the consumer is better off due to a change in income and price
C When income and price change
.
D None of the above
.
Answer Report Discuss
Option: A
Explanation :
30:
Marginal revenue will be positive if elasticity of demand is
A.Equal to one
B.More than one
C.Less than one
D.Equal to zero
Answer Report Discuss
Option: B
Explanation :
31:
The degree of monopoly power can be measured by the formula
A.P MC/P
B.MR/AR - MR
C.AR/AR MR
D.AR MR/MR
Answer Report Discuss
Option: A
Explanation :
32:
The supply curve for the short-run competitive firm is the same as
Explanation :
33:
A centralised cartel
Explanation :
34:
Match the following :
(A) Various combinations of two commodities that a consumer can purchase 1. Indifference map
(B) Various combinations of two commodities that give consumer equal satisfaction 2.
Indifference curve
(D) Point of tangency of a budget line and an indifference curve 4. Consumer's equilibrium
2 3 4 1
B.(A) (B) (C) (D)
4 3 2 1
C.(A) (B) (C) (D)
1 2 4 3
D.(A) (B) (C) (D)
3 2 1 4
Answer Report Discuss
Option: D
Explanation :