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MANAGERIAL ECONOMICS

MANAGERIAL ECONOMICS
1. Managerial economics is a a) Science b) Arts c) Both a and b d) None Ans. a 2. Managerial economics is the integration of economic theory with business practice for the purpose of facilitating decision making and forward planning by the management it is expressed by a) Spencer and seigelman b) Mc Nair c) Merian d) None Ans. a 3. Main objective of the firm is a) Social welfare b) Profit maximization c) Survive d) All Ans. b 4. --------- planning implies planning in advance for the future a) Forward b) Backward c) Future d) None Ans. a 5. Managerial economics is a --------- subject a) Mathematic b) Practical c) Theoretical d) None a) b) c) d) Ans. d Industry leadership Market share expansion Social responsibilities All

8. Managerial economics helps in forecasting of a) b) c) d) Ans. d Supply Price Profit All

9. Managerial economics is mainly a -------- science a) b) c) d) Ans. a Prescriptive Subjective Objective None

10. Managerial economics is makes an attempt to explain how various economic concepts are usefully employed in --------a) b) c) d) Ans. c Management Staff management Business management All

11. ---------- is basically a branch of ----------? a) Economics, science b) Economics, arts c) Managerial economics, microeconomics d) Managerial economics, macroeconomics Ans. c 12. The managerial economics also use the services of many other sister science like a) Mathematics b) Operation research c) Psychology d) All Ans. d 13. Production implies ------------- of inputs into --------a) Transformation, output b) Raw material, WIP c) Both a and b d) None Ans. a 14. The term scope indicates the

Ans. b 6. Managerial economics helps in the --------- use of scarce resources of a firm to maximize its profits a) Maximum b) Optimum c) According to cost d) All Ans. b 7. Managerial economics also helps in

MANAGERIAL ECONOMICS
a) b) c) d) Ans. d Area of study Boundaries Subject matter All b) Managerial economics, realistic, modern business c) Managerial economics, realistic, modern d) None of the above Ans. b 20. State which statement is true? 1. The word decision suggests a deliberate choice made out of several possible alternative 2. Decision making is essentially a process of selecting 3. decision making is a staff function a) b) c) d) Ans. a Only 1 1,2 2,3 All

15. Success of any business depends on adequate---------and proper------------a) Capital, finance b) Capital, management c) Raw material, finance d) Raw material, management Ans. b 16. Two major functions of a managerial economist are ------ and --------a) Decision making, forward planning b) Forecasting, selling c) Production and cost d) All Ans. a 17. State which statement is true for features of managerial economics? 1. It is a new discipline and of recent origin 2. it is a highly specialized 3. It is mainly a normative science and as such it is a goal oriented and prescriptive science a) b) c) d) Ans. d 18. Match the following Set - A 1. Objectives of a firm 2. Demand analysis and forecasting 3. Production and cost analysis Set - B a) How much to produce b) How to produce c) Profit maximization A) B) C) D) Ans. A 1-c,2-a,3-b 1-a,2-c,3-b 1-b,2-a,3-c None Only 1 is true 1,2 are true 1,3 are true All are true

21. Demand = a) b) c) d) Ans. d 22. The called a) b) c) d) Ans. c

Desire to buy Ability to pay Willingness to pay All

graphical presentation of the demand schedule is Demand Demand graph Demand curve None

23. The demand curve has a ----------- slope a) Positive b) Negative c) Equal to horizontal axis d) All Ans. b 24. D= a) b) c) d) Ans. a F(P) F(I) F(G) None

19. ------------ Helps the business executives to become much more responsive, ------------ and competent to face the ever changing challenges in the ------------- word a) Economics, realistic, modern business

25. The operation of the law is conditioned by the phrase a) Other things being equal b) Other things being change c) Other things being increased d) None Ans. a 26. Demand is a strengthened with a rise in price or weakened with a fall in price this paradox is given by

MANAGERIAL ECONOMICS
a) b) c) d) Ans. b Veblen Giffen Robbinson None Ans. a 34. Pe = a) A/L b) U/L c) L/U d) None Ans. c Question 28. Perfectly inelastic Demand Symbolized by a) ED = b) ED = 0 c) ED>1 d) None Ans. b 29. Relatively inelastic demand is symbolized by a) ED = b) ED>1 c) ED<1 d) None Ans. c 30. ----------- goods are those that are considered to be economically interchangeable by buyers a) Durable b) Single use c) Substitute d) Complementary Ans. c 31. The total quantity of a commodity demanded at different prices in a market by the whole body consumers at a particular period of time is called a) Market demand schedule b) Individual demand schedule c) Both a and b d) None of the above Ans. a 32. A fall in price leads to ----------- in demand and a rise in price leads to --------- in demand a) Expansion, contraction b) Contraction, expansion c) All of the above d) None of the above Ans. a 33. Advertising elasticity refers to the ------------ to change of demand or --------- to change in advertising expenses e) f) g) h) Responsiveness, sales Passiveness, order Both a and b None

27. When elasticity is measured over an interval of a demand curve the elasticity is called as an a) Interval elasticity b) Arc elasticity c) Point elasticity d) Both a and b Ans. d

35. In the above diagram D1 means e) Demand f) Backward shift g) Forward shift h) None Ans. c 36. In the above diagram D2 means a) Demand b) Backward shift c) Forward shift d) None Ans. b 37. If demand = 20 and it rise up to 60 and price = 6 and price decrease up to 4. What is the price elasticity? i) 6 j) -6 k) 8 l) -8 Ans. b 38.

MANAGERIAL ECONOMICS
40. Price of tea rises from 4 to 6 per cup and demand for coffee rises from 50 cups to 80 cups, then the cross elasticity of coffee is a) 1 b) 2 c) 3 d) 1.6 Ans. d 41. Demand forecasting refers to an ------------- of most likely future demand for a product under given condition a) Estimation b) Hypothesis c) Both a and b d) None Ans. a 42. Demand forecasting helps in estimating -------financial requirements a) Long run b) Short run c) Both a and b d) None Ans. c 43. Level of demand forecasting is a) Micro level b) Firm level c) Industry level d) All Ans. d 44. Demand forecast for cotton textile industry supply information to the most likely demand for textile a) Machinery b) Colour c) Dye stuff d) All Ans. d Match the following according to the above diagram Set - A 1. A 2. B 3. C Set B a) E<1 b) E>1 c) E=1 A) 1-a,2-c,3-b B) 1-b,2-a,3-c C) 1-b,2-c,3-a D) None Ans. c 45. In the long run forecasting for a period of a) 3 to 5 years b) 10 years c) 1 year d) Both a and b Ans. d 46. National income is Macro level Industry level Micro level All Ans. a 47. Delphi method is developed by Olaf helmer

Match the following according to the above diagram Set - A 1. A 2. B 3. C 4. D 5. E Set - B a) ED = b) ED = 0 c) ED >1 d) ED<1 e) ED = 1 A) B) C) D) Ans. d 39. 1-b,2-a,3-c,4-d,5-e 1-a,2-b,3-d,4-c,5-e 1-a,2-c,3-b,4-d,5-e 1-a,2-b,3-e,4-d,5-c

MANAGERIAL ECONOMICS
Dalky Gordon All Ans. d 48. The straight line equation is used in a) Trend method b) Moving average method c) Least squares method d) None Ans. c 49. Yc = a) a + b b) a + cx c) a + bx d) none Ans. c 50. An Automobile Co., while introducing a new version of a car will study the level of demand for the existing car it is the example of a) Opinion poll approach b) Growth curve approach c) Both a and b d) None Ans. b 51. In the diagram given below what is the means of A Ans. c 54. In --------- method, the sale of the product under consideration is projected on the basis of demand surveys of the industries using the given product as an intermediate product. a) End use b) Input output c) Both a and b d) None Ans. c 55. ------------- Movements indicate the general conditions and direction in which graph of a time series move in relatively a ---------- of time a) Secular, Long period b) Long run, long period c) Long run, short period d) Both a and b Ans. d 56. xy =

e) ax + bx2 f) ax + bx g) ax + x2
h) none Ans. a

e) f) g) h) Ans. a

Trend line Sales Forecasting All

52. ---------- method, efforts are made to collect the relevant information directly from the consumers with regard to their future purchase plans Survey method Consumer interview method Both a and b None Ans. b 53. Survey of buyers intentions also called Survey of buyers preference Opinion surveys Both a and b None

57. Match the following according to the above diagram Set - A 1. A 2. B 3. C 4. D Set - B a) Trend projection method b) Collective opinion method c) Consumers interview method d) Economic indicators A) 1-d,2-b,3-c,4-a B) 1-c,2-b,3-a,4-d C) 1-a,2-c,3-b,4-d D) None of the above Ans. b Question

MANAGERIAL ECONOMICS
Years sales 1990 30 1991 40 1992 35 1993 50 1994 45 65. Supply curve is a) negative slope b) upward slope c) positive slope d) both b and c Ans. d 66. Stock is --------------a) Supply b) Potential supply c) Demand d) Potential demand Ans. b 67. Supply is different from a) Production b) Stock c) Both a and b d) None Ans. c 68. Supply schedule is a ---------- representation of different quantities of a commodity supplied a) Graphical b) Diagrammatical c) Tabular d) All Ans. c 69. There will be a change is supply when the change in a) Cost of production b) Monopoly c) No. of sellers d) All Ans. d 70. Modern economics is sometimes called a) Demand analysis b) Supply analysis c) Equilibrium analysis d) All Ans. c 71. Stock is the ----------- of a commodity which can be brought into the market for sale at a short notice and supply means the quantity which is ----------- in the market a) Total volume, actually brought b) Actual supplied, actually safe c) Both a and b d) None Ans. a 72. According to the law of supply when price falls, supply will ---------- and when price rises, supply will ----a) Contract, no change

58. In the above question Yc for the year 1993 is a) 32 b) 36 c) 44 d) 48 Ans. c 59. In the above question Yc for the year 1996 is a) 52 b) 44 c) 48 d) 56 Ans. d 60. An ---------- indicates change in the magnitude of an economic --------. It gives the signal about the -------- of change in an economic--------a) Economic indicator, variable, direction, variable b) Economics , variable, direction, variable c) Economic indicator, variable, amount, variable d) None Ans. a 61. The supply of goods is the quantity offered for sale in a given, market at a given time at various prices this definition is given by a) Thomas b) Prof. Macconnel c) Both a and b d) None Ans. a 62. In fish and fruits, supply and stock are the a) Different b) Same c) For fish it is different and for fruits it is same d) None Ans. b 63. S = a) b) c) d) Ans. a F(P) F(X) F(D) None

64. Political conditions may disrupt production of a product. In that case, supply tends to become ---------a) Perfectly elastic b) Perfectly inelastic c) Inelastic d) None Ans. c

MANAGERIAL ECONOMICS
b) Contract, extend c) No change, extend d) None Ans. b 73. The supply curve is a ------------- representation of the supply ---------a) Geometrical, curve b) Geometrical, schedule c) Geographical, schedule d) None Ans. b 74. The changes in equilibrium price will occur when there will be shift either in a) Demand curve b) Supply curve c) Both demand and supply shift d) Shift in equilibrium Ans. c 75. Supply would be more --------- in the ---------a) Elastic, long run b) Inelastic, long run c) Elastic, short run d) None Ans. a 76. The --------- of a commodity depends upon the --------of demand and supply a) Price, degree of elasticity b) Cost, degree of elasticity c) Sale, degree of supply d) Purchase, degree of demand Ans. a e) A) B) C) D) Ans. C 78. ES =0 1-a,2-c,3-b,4-d,5-e 1-a,2-b,3-c,4-d,5-e 1-d,2-e,3-c,4-a,5-b 1-a,2-b,3-c,4-e,5-d

Match the following according the above diagram Set - A 1. A 2. B 3. C Set - B a) Equilibrium b) Supply c) Demand A) 1-a,2-b,3-c B) 1-c,2-b,3-a C) 1-b,2-a,3-c D) None Ans. d

79.

77. Match the following according the above diagram Set - A 1. A 2. B 3. C 4. D 5. E Set - B a) ES =1 b) ES >1 c) ES <1 d) ES =

In the above diagram a) There is a change in market equilibrium b) There is no change in market equilibrium c) Supply is increase demand is decrease d) Supply is decrease demand is increase Ans. b

MANAGERIAL ECONOMICS
d) None Ans. b 80. 86. Each ISO-Quant curve represents ------- particular level of output a) 1 b) 2 c) 3 d) 4 Ans. a 87. Expand MRTS a) Marginal ratio of technical substitution b) Marginal rate of technical substitution c) Marginal rate of technical solution d) None of the above Ans. b 88. The ISO Quant curve will---------- either X or Y axis a) Touch b) May be touch c) May be touch only Y axis d) Not touch Ans. d 89. ------- arise with in or inside the firm a) Internal economies b) Real economies c) Both a and b d) None Ans. c 90. Cost is analyzed from the --------- point of view a) Producers b) Managers c) Share holders d) All Ans. a 91. ----------- input are those factors the quantity of which remains constant irrespective of the level of output produced by a firm e) Fixed f) Variable g) Both a and b h) None Ans. a 92. In, the Law of diminishing returns, that in the beginning ------- will be higher than --------a) AP,MP b) MP, AP c) TP, AP d) MP, TP Ans. b

In the above diagram if the demand shift right it means demand is ---------- If the demand shift left it means demand is ---------- and equilibrium is ---------a) Increase, decrease, changed b) decrease, increase, changed c) Increase, decrease, no change d) None Ans. a 81. Factor of production is a) Land b) Labor c) Capital d) All Ans. d 82. Q = a) b) c) d) Ans. c f(X,Y,Z ---------- etc.) f(A,B,C ---------- etc.) f(L,N,K ---------- etc.) none

83. The law of variable is also called a) Law of fixed returns b) Law of variable returns c) Law of diminishing returns d) None Ans. c 84. As the proportion of one factor in a combination of factors is increased after a point, first the marginal and then the average product of that factor will diminish this is defined by a) Prof. Benham b) Prof. Marshall c) Prof. A.L. bowley d) None Ans. a 85. Average output is denoted by a) AO b) AP c) EP

MANAGERIAL ECONOMICS
93. ----------- is a concept to the -------- line of the consumer a) ISO Cost, Demand b) ISO Quant, Budget c) ISO Quant, Price d) ISO Cost, Price Ans. d 94. The following diagram is a diagram of -----------98.

In the above diagram represents a) Production process b) Production function c) Both a and b d) Production analysis Ans. c 99. Match the following Set - A 1. Stage 1 2. Stage 2 3. stage 3 Set - B a) The total output increases at an increasing rate and MP decline after this b) TP Increases at a diminishing rate and both AP and MP declining but they are positive c) TP starts diminishing AP continues to diminish and MP becomes negative A) B) C) D) Ans. B 1-b,2-a,3-c 1-a,2-b,3-c 1-a,2-c,3-b None

a) b) c) d) Ans. a

Constant return to scale Law of diminishing returns Law of variable All

95. When the quantity of all inputs are increased by 10% and output increases by 5%, then we say that --------- is operating a) Returns to scale b) Diminishing returns to scale c) Both a and b d) None Ans. b 96. The advantage or benefits that accrue to a firm as a result of increase in its scale of production are called a) Economies of scale b) Internal economies c) Real economies d) All of the above Ans. a

100. State which statement is true? 1. ISO Quant is also called equal product curve 2. ISO Quant is a curve which shows the different combinations of the two inputs producing the same level of output

97. A firm produces product A and B separately. Cost of producing 100 units of A is Rs. 8000 and cost of producing 100 units of B is Rs. 5000. If the firm produces both products A and B jointly, in that case, its total cost would be Rs. 10000. Find SC a) b) c) d) Ans. c 0 .2 .3 .4

3.

The above is a curve of ISO Cost

a) Only 1 b) Only 2

MANAGERIAL ECONOMICS
c) Only 3 d) Both 1,2 Ans. d 101. The equation U = f(S,M,Id), U means a) Managers utility function b) Managers unlimited functions c) Managers utility factors d) None Ans. a 102. In the q. no. 101, Id stands for a) Discretionary investment b) Discover investment c) Discontinue investment d) All Ans. a 103. Traditional objective of a firm is a) Profit b) Profit maximization c) Both a and b d) Social welfare Ans. b 104. ----------- studies the impact of managerial utility functions on the performance of a firm a) Boumal analysis b) Williamson c) Marris d) None Ans. b 105. Business decisions are made to cope with a) Maintenance b) Change c) Both d) None Ans. b 106. The full form of MR is a) Marginal requirement b) Managerial revenue c) Marginal revenue d) None Ans. c 107. ---------- works as a shock absorber a) Stock payment b) Slack payment c) Cash payment d) None Ans. b 108. In --------- relationship, growth determines profit a) Differentiated diversification b) Dividend diversification c) Diamond desired d) None Ans. a 109. Sales maximization model is an alternative for ----model a) Cyert model b) March model c) Both a and b d) Profit maximization model Ans. d 110. All ----------- are inter connected and supplement on another a) Model b) Theory c) Objectives d) All Ans. d

Question

111. In the above diagram loss area is a) A b) B c) N1,N2 d) Both A and B Ans. d 112. In the above diagram max. Profit area is a) A b) B c) N1,N2 d) Both A and B Ans. c

MANAGERIAL ECONOMICS
113. According to the --------- theory, a traditional firm is a group with a particular organizational and management structure having command over its own property rights a) Cyert and marchs b) Economist theory of firm c) Profit maximization d) All Ans. b 114. The management has to keep a high level of retained profits for further expansion and development but it should not displease the shareholders that is a) Profits / total profits (by giving low dividends b) Retained profits / total profits (by giving low dividends c) Retained profits / total profits (by giving low dividends d) None of the above Ans. c

118. Match the following according to the above diagram Set - A 1. A 2. B 3. C Set - B a) TR b) TC c) Profit A) B) C) D) Ans. c 1-a,2-b,3-c 1-c,2-b,3-a 1-b,2-a,3-c None of the above

115. --------------- model highlights that the primary objective of a firm is to maximize its sales rather than profit maximization. It states that the goal of the firm is maximization of sales revenue subject to a minimum profit constraint a) Boumals static b) Dynamic models c) Profit maximization model d) Both a and b Ans. d 116. The managers utility function is expressed as a) S = f(S,M,Id) b) U = f(S,M,Id) c) U = f(S,U,Id) d) None of the above Ans. b 117. A firm will be maximizing its profits when --------and --------- curves cuts -------- curve from --------a) MC = MR, MR, MC, below b) MR = MC, MC, MR, above c) MR = MC, MC, MR, below d) MR = MC, MC, AR, below Ans. c

119. Match the following according to the above diagram Set - A 1. OD output level 2. OF output level 3. Mid of DE output level Set - B a) Profit is maximum and TR is much in excess of TC b) Profit will fall TR is still in excess of TC c) Profit constraint is less A) 1-a,2-b,3-c B) 1-b,2-c,3-a C) 1-a,2-c,3-b D) None of the above Ans. a 120. The -------------- model highlights on achieving a balanced growth rate of a firm. --------------- (g) is equal to two important variables 1. --------------- (gd), 2. --------(gc). Hence, Max---- = --------=-------a) Marris growth maximization, minimum growth rate, the rate of demand for the products, growth rate of capital, g,gd,gc b) Marris growth maximization, maximum growth rate, the rate of demand for the products, growth rate of capital, g,gd,g

MANAGERIAL ECONOMICS
Cyert and marchs, maximum growth rate, the rate of demand for the products, growth rate of capital, g,gd,gc d) Marris growth maximization, maximum growth rate, the rate of demand for the products, growth rate of capital, g,gd,gc Ans. d 121. The -------------, which the firm receives by the sale of its output in the market, is known as its revenue a) Profit b) Net profit c) Amount of money d) All Ans. c 122. Total revenue is also called a) TR b) Gross revenue c) Net revenue d) Both a and b Ans. d 123. AR means a) b) c) d) Ans. a Price Profit Revenue All c) 128. In perfect competition a) JR = MR = Price b) AR = MR = Price c) AR = MR = Demand d) None Ans. b 129. In the diagram below it is the diagram under

a) b) c) d) Ans. b

Perfect competition Imperfect competition Both a and b None

124. --------- is a modified form of full cost pricing a) Rate of return pricing b) Skimming pricing c) Both a and b d) None Ans. a 125. TR = a) P*Q b) P+Q c) P-Q d) None Ans. a 126. MR= a) TR / P b) TC Q c) TR / Q d) None Ans. c 127. ---------- is the highest when MR is zero a) TR b) TC c) AR d) AC Ans. a

130. ------------ refers to the share of a firms sales of a particular product in the total sales of all firms in the market a) Market share b) Firm share c) Industry share d) Country share Ans. a 131. If a firm can sell 10 units at Rs. 20 each or 11 units at Rs. 19 each, then the MR from the eleventh unit is a) 9 b) 19 c) 20 d) 11 Ans. a 132. The diagram given below is

a) b) c) d) Ans. a

Under perfect market Under monopoly Oligopoly None

Question Production = 8000 units, TFC = 30000, TVC = 50000, 20% net profit margin

MANAGERIAL ECONOMICS
133. In the above question what is the per unit cost a) 10 b) 2 c) 20 d) 30 Ans. a 134. In the above question what is the selling price a) 10 b) 20 c) 30 d) 12 Ans. d 135. Capital employed by a firm is Rs. 16 Lacks and the total cost is Rs. 12 Lacks with a planned rate of return of 30%. Find what the selling price is a) 40 b) 12 c) 52 d) None Ans. c 136. Under ----------- a firm, fix its --------- according to the --------- fixed by the leader a) Pricing, price, price b) Going rate pricing, price, price c) Going rate pricing, demand, demand d) None of the above Ans. b Question D) None Ans. b 138. It is clear for the above diagram that a) (RM / RQ) = RM / (RM RM) b) (RM / RQ) = RM / (RQ QM) c) (RQ / RM) = RM / (RM QM) d) (RM / RQ) = RM / (RM QM) Ans. d 139. Suppose that the price of a product is Rs. 4 and the elasticity coefficient is 2 then the corresponding MR will be a) 1 b) 6 c) 0 d) 2 Ans. a 140. Match the following Set - A 1. Marginal cost pricing 2. Customary pricing 3. skimming price policy 4. penetration price policy Set - B a) Instead of setting a high price, the firm may set a low price for a new product by adding a low mark up to the full cost. b) The system of charging high prices for new products c) Prices of certain goods are more or less fixed in the minds of consumers these are known as charm prices also d) Price is determined on the basis of MC which refers to the cost of producing additional units A) B) C) D) Ans. d 1-a,2-b,3-d,4-c 1-b,2-a,3-c,4-d 1-a,2-b,3-c,4-d 1-d,2-c,3-b,4-a

137. Match the following according to the above diagram Set - A 1. A 2. B 3. C Set - B a) MR b) AR c) Price A) 1-a,2-b,3-c B) 1-b,2-a,3-c C) 1-a,2-c,3-a

141. A market structure is characterized by the a) No. of sellers b) No. of buyers c) Scope for entry and exit d) All Ans. d 142. Perfect competition exhibits an ------ market situation a) Ideal b) Idle c) Normal d) None Ans. a

MANAGERIAL ECONOMICS
Ans. b 143. In long term and in perfect competition a firm earn a) Profit b) Normal profit c) Super normal profit d) Any of above Ans. b 145. In perfect competition a firm is price a) Maker b) Taker c) Both a and b d) None Ans. b 146. What is the means of MONO a) Single b) Minus c) Buyer d) Seller Ans. a 147. A monopolist is the only producer of a product that has no close substitute it is defined by a) Prof. Wilson b) Prof. Watson c) Prof. Williamsons d) None Ans. b 148. ---------- is a situation in which there are a few large buyers a) Oligopsony b) Monopoly c) Bilateral d) None Ans. a 149. In perfect competition commodity is a) Heterogeneous b) Substitute c) Homogeneous d) All Ans. c 150. In monopoly there is ------- seller a) 1 b) 2 c) 3 d) Many Ans. a 151. -------- is a situation where a monopolist faces a -----a) Bilateral, oligopolies b) Bilateral monopoly, monopsonist c) Both a and b d) None Question

152. In the above diagram B and C means a) Monopoly, Imperfect competition b) Oligopoly, Imperfect competition c) Both a and b d) None Ans. a 153. In the above diagram D means a) Monopolistic competition b) Duopsony c) Bilateral monopoly d) All Ans. d 154. --------- is a situation of a few big buyers controlling the market, industry analysis explains how the entire market is closely knit and how the structure of the market a) Oligopoly b) Oligopsony c) Both a and b d) None Ans. b 155. ------ is an economic condition similar to a ----------in which there are only --------- large buyers for a specific product or service a) Duopsony, Duopoly, two or three b) Monopsony, Duopoly, two c) Duopsony, Duopoly, two d) None of the above Ans. c 156. A ----------- too can adopt price discrimination paying different prices to different sellers according to the ----------a) Monopolist, Elasticity of supply b) Monopsonist, elasticity of supply c) Both a and b d) None Ans. b 157. In the diagram given below we get

MANAGERIAL ECONOMICS
a) Policy of price discrimination, different prices,
different customers, different commodity, differences b) Policy of price discrimination, same prices, same customers, same commodity, differences c) Policy of demand discrimination, different prices, different customers, different commodity, differences d) Policy of price discrimination, different prices, different customers, same commodity, differences Ans. d 161. The concept of consumers surplus was first invented by a ---------- in the year 1944 a) French Engineer Dupuit b) English Engineer Dupuit c) Roman economist Dupuit d) None Ans. a 162. The volume of consumers surplus varies with variations in a) Demand b) Price c) Both a and b d) None Ans. b a) b) c) d) Ans. c Normal profit Super normal profit Losses None 163. When price rise consumers surplus is a) Falls b) Rise c) No change d) None Ans. a 164. The total amount of consumers surplus is the area below the ---------- and above the price line a) Supply curve b) Demand curve c) Both a and b d) None Ans. b 165. ---------- is a parallel concept to consumers surplus a) Production b) Production concept c) Producers surplus d) All Ans. c 166. The direct or indirect payment by government to producers or consumers to defray part of the cost of economic activity is called a) Dead weight loss b) Surplus c) Income

a) b) c) d) Ans. b

Normal profit Super normal profit Loss None

158. In the diagram given below we get

159. Match the following Set - A 1. AR> AC 2. AR=AC 3. AR<AC Set B a) Normal profit b) Super normal profits c) Losses A) B) C) D) Ans. B 1-c,2-b,3-a 1-b,2-a,3-c 1-a,2-b,3-c None of the above

160. The --------- refers to the practice of a seller to charge ------------ for ---------- for the -------------, produced under a single control without corresponding ---------- in cost

MANAGERIAL ECONOMICS
d) Subsidies Ans. d 167. According to the Dr. ---------The government should adopt those economic policies which promote consumers surplus a) Pattel b) Little c) Mittal d) None Ans. b 168. The consumers surplus concept used in a) Conjectural advantage b) Cost benefit analysis c) Public finance d) All Ans. d 169. The living standards of the people of USA are certainly more when compared to India because the national output and percapita income is high. This is the example of a) Cost benefit b) Conjectural advantage c) Public finance d) None Ans. b 170. Vivek is a seller and is ready to sell at 20 and actually sell at Rs. 30. Then producers surplus is a) 20 b) 30 c) 50 d) 10 Ans. d 171. Consumers surplus = e) What we are prepared to use what we actually pay f) What we are prepared to pay what we actually use g) What we are prepared to pay what we actually pay h) None Ans. c QUESTION 172. In at a) b) c) d) Ans. c the above question Demand and supply are equal d s e none

173. In the above question RDE is a a) Consumers surplus b) Producers surplus c) Both a and b d) None Ans. a 174. In the above question SRE is a a) Consumers surplus b) Producers surplus c) Both a and b d) None Ans. b 175. Producer surplus = a) What the seller is actually receiving what the seller ready to receive b) What the seller is actually selling what the seller ready to receive c) What the seller is actually receiving what the seller ready to sell d) None of the above Ans. a 176. If total units sold 5, total price receive 75, total price expected 25 then producer surplus = a) 50 b) 25 c) 100 d) 150 Ans. a 177. If total units purchased 5, total utility 200, total price paid 150 then consumers surplus = a) 100 b) 80 c) 50 d) 60 Ans. c

MANAGERIAL ECONOMICS
178. Match the following according to the above diagram Set - A 1. A 2. B 3. C Set B a) MU b) Consumers surplus c) Area of expenditure A) 1-a,2-b,3-c B) 1-b,2-c,3-a C) 1-b,2-a,3-c D) None Ans. B 179. Match the following according to the above diagram Set A 1. OD * OQ = ODPQ 2. OR * OQ =OPPQ 3. ODPQ ORPQ = RDP 4. OR Set - A a) C.S. b) Actual expenditure incurred by the consumer c) Total expenditure willing to incur d) Actual market price A) B) C) D) Ans. D 1-b,2-a,3-c,4-d 1-a,2-c,3-b,4-d 1-a,2-b,3-d,4-c 1-c,2-b,3-a,4-d C) 1-a,2-b,3-c,4-d D) 1-a,2-c,3-b,4-d Ans. C 181. Macroeconomics is also called a) Aggregative economics b) Lumping method c) Both a and b d) None Ans. a 182. Macroeconomics covers the topics are a) The theory of economics and employment b) The general theory of price level c) The theory of growth d) All Ans. d 183. When values of a variable are to be determined with in the system is called a) Endogenous b) Exogenous c) Both a and b d) None Ans. a 184. Macroeconomic variables deal with a) National product b) Consumption function c) Saving function d) All Ans. d 185. Flow variable has a a) Time dimension b) Demand dimension c) Price dimension d) All Ans. a 186. When a no. of commodities and their prices at two different periods are arranged in a tabular form, it is called as an a) Consumers price index b) Index number c) Both a and b d) None Ans. b 187. ---------- tells us the percentage of consumption out of a given level of income a) Saving income ration b) Consumption income ration c) Income ration d) None Ans. b

180. Match the following according to the diagram given below

Set - A 1. 2. 3. 4. Set - B a) b) c) d) OQ OM * OQ = OMNQ OS * OQ = OSNQ OMNQ OSNQ = SNM

Actual sales Total price received Price expected to get P.S.

A) 1-b,2-a,3-c,4-d B) 1-a,2-b,3-d,4-c

MANAGERIAL ECONOMICS
188. The days of ------- are gone a) Money b) Kingdom c) Barter d) None Ans. c 189. Expand CPI a) Customers price index b) Consumers price index c) Both a and b d) None Ans. b 190. Expand WPI a) Whole sale price index b) Whole price index c) Both a and b d) None Ans. a 191. ----------- is that branch of economics, which deals with the study of aggregative or average behavior of the entire -------? a) Macroeconomics, industry b) Macroeconomics, firm c) Macroeconomics, economy d) None Ans. c 192. The amount that the people actually save in a particular time is called a) Ex ante b) Ex post c) Both a and b d) None Ans. b 193. Out of Rs. 100 a person can consume Rs. 80 and save Rs. 20. In this case consumption income ratio is a) 8:2 b) 1:08 c) 1:02 d) None Ans. b 194. When we say that COR is 4:1 it implies that a capital investment of Rs. --- is required to produce ------ unit of output. a) 4,1 b) 1,4 c) Both a and b d) None Ans. a 195. GNP Deflator = a) b) c) d) Ans. b GNP of the chosen year / 100 PIN of the chosen year / 100 PIN of the chosen year * 100 / GNP None

196. The GNP deflator acts fas an adjustment factor which is used to convert -------------- into -----------a) Nominal GNP, Real GNP b) Real GNP, Nominal GNP c) GNP, Real GNP d) None Ans. a

197. Nominal GNP for the year 2005-06 = Rs. 1500000, WPI for the year is 120, base year PIN 100. then what is the real GNP for 2005-06 a) 1500000 b) 150000 c) 1250000 d) None Ans. c 198. If we calculate GNP at --------- market prices, it is called as -----------GNP and if we measure GNP at -------prices, i.e., prices prevailing at the base year, it is described as ----------- GNP a) Base year, nominal, constant, real b) Current, real, constant, nominal c) Current, nominal, current, real d) Current, nominal, constant, real Ans. d 199. The concept of ----------- ratio explains the relationship between the ------------- and --------------. It is a ratio of ------------ in output or real income to an ------in capital a) Capital output, value of capital investment, value of output, decrease, increase b) Capital output, value of capital investment, value of output, increase, decrease c) Capital output, value of capital investment, value of output, increase, increase d) Capital output, value of capital input, value of output, increase, increase Ans. c 200. Match the following Set - A 1. APS 2. APC 3. Liquidity ratio 4. leverage ratio Set - B

MANAGERIAL ECONOMICS
a) b) c) d) A) B) C) D) Ans. B Total consumption / total income Liquid assets/ total assets Total savings/total income Value of debts / total assets 1-a,2-b,3-d,4-c 1-c,2-a,3-b,4-d 1-b,2-a,3-c,4-d 1-a,2-c,3-b,4-d 207. ----------- shows the effect of changes in consumption on induced investment and tells us how the volume of investment depends on the level of consumption a) Multiplier b) Accelerator c) Both a and b d) None Ans. b 208. a = a) b) c) d) Ans. c

201. MPC + MPS = a) 0 b) 1 c) 2 d) 3 Ans. b 202. Multiplier concept is developed by a) Prof. Keynes b) Prof. Khan c) Both a and b d) None Ans. b 203. Investment which varies with the changes in the level of national income is called ---------- investment a) Induced b) Autonomous c) Both a and b d) None Ans. a 204. The investment, which is independent of the level of income, is called as -------- investment a) Induced b) Autonomous c) Both a and b d) None Ans. b 205. Autonomous investment is guided by a) Social welfare b) Profit motive c) Both a and b d) None Ans. a 206. Depreciation is part of a) Investment b) Net investment c) Gross investment d) All Ans. c

C/I A/C I/C None

209. Accelerator is called a) Magnification of derived demand b) Magnification of derived supply c) Both a and b d) None Ans. a 210. Consumption function is determined by a number of -------- factors a) Subjective b) Objective c) Both a and b d) None Ans. c 211. If total consumption is Rs. 8000 and Yield is Rs. 10000 then what is the APC? a) 0.8 b) 80% c) Both a and b d) None Ans. c 212. Total income increases from 10000 crore to 20000 crore and total consumption increases from 8000 crore to Rs. 15000 crore then MPC = a) 70% b) 60% c) 0.6 d) None Ans. a 213. What is the name of the curve is given below?

MANAGERIAL ECONOMICS
a) Induced investment b) Autonomous investment c) Simple investment d) All Ans. a 214. If MPC = 2/3 then K = a) 1 b) 3 c) 2 d) 4 Ans. b 215. The value of MPC is always -------- but -------- one a) Positive, less than b) Negative, less than c) Positive, more than d) Negative, more than Ans. a 216. --------- may be defined as a ------------ to a change in investment a) Accelerator, ratio of change in income b) Multiplier, ratio of change in income c) Both a and b d) None Ans. b 217. The supply price of a capital asset is Rs. 3000 and the asset will become useless after two years. Expected yield for first year is 1100 and for second year is 2420. Rate of discount is 10%. Then Cr = a) 2000 b) 3000 c) 4000 d) 2500 Ans. b 218. State which statement is true? 1. MPC is greater than zero 2. MPC goes down as income increases 3. MPC of the poor is greater than that of the rich 4. In the short run MPC is stable a) b) c) d) Ans. d 1,2 2,3 3,4 All c) Neutral

A) 1-b,2-a,3-c B) 1-a,2-c,3-b
C) 1-a,2-b,3-c D) None of the above Ans. C 220. Match the following Set - A 1. Higher the value of MPC 2. When MPS = 0 and MPC = 1 3. When MPS = 1, and MPC = 0 Set B a) There will be a 100% increase in income every time b) What is earned will be saved and the value of multiplier will be 0 c) Higher would be the value of K.

A) 1-c,2-a,3-b
B) 1-a,2-b,3-c C) 1-b,2-a,3-c D) None Ans. A 221. Instrument of economic stability is a) Monetary policy b) Fiscal policy c) Direct controls d) All Ans. d 222. ------ policy deals with the total money supply and its management in an economy. a) Monetary b) Fiscal c) Physical d) All Ans: a 223. According to ----------Monetary policy is the management of the expansion and contraction of the volume of money in circulation for the explicit purpose of attaining a specific objective such as full employment a) RP Kent b) D.C. Rowan c) PR Kent d) C.D. Rowan Ans. a 224. The monetary policy should be neutral in its effects on a) Prices and Income b) Income and output c) Output and employment d) All of the above

219. Match the following Set - A 1. MEC>IR 2. MEC<IR 3. MEC=IR Set - B a) Favorable b) Adverse

MANAGERIAL ECONOMICS
Ans. d 225. The term fisc means a) Finance b) Teasurary c) Both a and b d) None Ans. b 226. Fiscal policy is a package of economic measures of the government regarding its a) Public expenditure b) Public revenue c) Public debt d) All of the above Ans. d 227. The amount of new money printed by the government depends on the -------------- of the economy a) Absorption capacity b) Growth c) Development d) All Ans. a 228. Expand BIS a) Built in stability b) Built in stabilizers c) Bullet in stability d) None Ans. b 229. Physical policy refers to a) Direct control b) Indirect control c) Both a and b d) None Ans. a 230. Investments in certain fields and foreign trade is regulated through a) Licensing b) Fixing of quotas c) Import controls d) All of the above Ans. d 231. A --------- monetary policy may be followed by cutting down the interest rates or a ------------ monetary policy by raising the rate of interest. e) Cheap, Positive f) Dear, positive g) Cheap, dear h) None Ans. c 232. A Higher rate of -------- ensure -------- condition, higher output, income and better living standards to the people a) Economic growth, development b) Growth in demand, full employment c) Economic growth, full employment d) All of the above Ans. c 233. Import controls are executed through a system of ----and ---------a) Quotas and Licenses b) Quotas and rationing c) Both a and b d) None Ans. a 234. --------- policy is the policy of the --------a) Fiscal, central Bank b) Monetary, Central Government c) Monetary, Central Bank d) Fiscal, Judiciary Ans. c 235. The major objective of Fiscal policy is a) Achieve optimum allocation of economic resources b) Bring about equal distribution of Income and wealth c) Maintain price stability d) All of the above Ans. d 236. Tax on individual is called ---------- and tax on commodity is called ----------a) Direct tax, Excise tax b) Direct tax, Indirect tax c) Direct tax, Commodity tax d) Both b and c Ans. d 237. Match the following Set - A 1. Bank rate policy 2. Open market operations 3. variable reserve ratio 4. rationing of credit Set - B a) Borrowing is discourage when its goes up b) This method is sometimes adopted to make the bank rate effective c) Minimum requirement is 3% to 15% d) By limiting the amount available to each applicant A) 1-b,2-a,3-c,4-d B) 1-a,2-b,3-d,4-c

MANAGERIAL ECONOMICS
C) 1-a,2-b,3-c,4-d D) 1-a,2-c,3-b,4-d Ans. C 238. Match the following Set - A 1. Public Revenue 2. Public expenditure policy 3. Public debt or public borrowing policy 4. Deficit financing Set - B a) Tax revenue b) Development c) All loan taken by the government d) It implies printing of fresh and new currency notes by the government A) B) C) D) Ans. B 1-b,2-a,3-c,4-d 1-a,2-b,3-c,4-d 1-a,2-b,3-d,4-c 1-a,2-c,3-b,4-d c) Both a and b d) None Ans. b 242. According to Prof. ------- The business cycle in the general sense may be defined as an alternation of periods of prosperity and depression of good and bad trade a) Haberler b) Haber c) Keynes d) None Ans. a 243. Depression is characterized by a) Falling prices b) Falling profits c) Large scale unemployment d) All Ans. d 244. When economic development starts in full swing and there will be fuller utilization of a) Resources b) Staff c) Output d) All Ans. d 245. The recession phase is characterized by a) Hesitation b) Doubt c) Fear d) All Ans. d 246. Hawtrey gives a) Monetary theory b) Over investment theory c) Profit maximization theory d) None Ans. a 247. Multiplier and accelerator theory is given by a) Hicks b) Samuelson c) Both a and b d) None Ans. c 248. Granting of ----- might help in recovering from slump a) Free food b) Free Houses c) Aid d) All Ans. c

239. State which statement is true regarding direct controls in physical policy? 1. Control over consumption and distribution through price control and rationing 2. Control over investment and production through licensing and fixing of quotas etc. 3. Control over foreign trade through import control, import quotas, export control etc. a) 1,2 b) 2,3 c) 1,3 d) All Ans. d 240. State which statement is true regarding role of fiscal policy in the economic development? 1. To act as a saver 2. To act as an investor 3. To act as growth promoter 4. To act as an income redistributer 5. To act as balancer a) b) c) d) Ans. d 1,2,3 3,4,5 2,3,4 All

241. The term business cycle refers to a -----a) Cycle b) Wave

MANAGERIAL ECONOMICS
249. Country like -------- have used monetary measures to control inflation a) U.K. b) U.S.A. c) India d) All of the above Ans. d 250. --------- is activity a) b) c) d) Ans. a the phase of highest level of economic Boom Recovery Increased Jump 256. The measures which are adopted to mitigate the harmful effects of contraction is e) Quick liquidation of inventories f) Reduction of cost of production g) Improvement in quality h) All of the above Ans. d 257. State which statement is true regarding economic evolution is characterized 1. A period of upswing followed by a period of downswing 2. A period of prosperity alternating with poverty and adversity 3. A period of boom followed by a period of slump 4. A period of recession followed by a period of revival 5. A period of favorable condition by an adverse condition a) b) c) d) Ans. d 258. 1,2,3,4 3,4,5 2,3,4 All

251. The business cycle is nothing but --------- in the ------level of economic activity of a nation e) Rhythmic fluctuations, continuous f) Rhythmic fluctuations, aggregate g) Fluctuations, aggregate h) None of the above Ans. b 252. Cyclical fluctuations have become a ------- feature of a ------- system a) Regular, socialist b) Irregular, capitalist c) Regular, capitalist d) None Ans. c 253. The depression phase comes to an end with the -----programs introduced like--------a) Recovery, Public works b) Recovery, Reduction in the rate of interest c) Both a and b d) None of the above Ans. c 254. According to professor Hayek discrepancy between the ----------- and --------- of interest cause business fluctuation a) Natural, market rate b) Unnatural, market rate c) Natural, flow of money supply d) None Ans. a 255. ---------- policy followed in the ------ during the post war period to fight the prospects of depression a) Price, U.K. b) Price support, U.S.A. c) Price, U.S.A. d) None Ans. b

Match the following according to the diagram Set - A 1. A 2. B 3. C 4. D 5. E Set - B a) Depression b) Recession c) Boom d) Recovery e) Full employment

A) B) C) D)
Ans. C

1-c,2-b,3-a,4-e,5-d 1-a,2-c,3-b,4-d,5-e 1-c,2-b,3-a,4-d,5-e 1-b,2-a,3-c,4-d,5-e

MANAGERIAL ECONOMICS
259. --------is a state of affair in which the -------consumed, produced and level of employment are ------and there are no --------- or unemployed workers. a) Prosperity, real income, high, idle resources b) Full employment, real income, rising, idle resources c) Both a and b d) Prosperity, income, high, idle resources Ans. c 260. Match the following Set - A 1. Schumpeters innovations theory of business cycle 2. Over investment theory of Von Hayek 3. Hawtreys Pure monetary theory of trade cycles 4. Modern theory of Interaction of Multiplier and Acceleration principle Set - B a) Introduction of a new method of production, a new process of production b) There is a natural or equilibrium rate of interest at which the demand for loanable funds is equal to the supply of the same through voluntary savings. c) The main factor affecting the flow of money supply is the credit creation by the banking system d) The changes in the level of income caused by the operation of the super multiplier have been explained in five steps A) B) C) D) Ans. D 1-b,2-a,3-c,4-d 1-a,2-c,3-b,4-d 1-a,2-b,3-d,4-c 1-a,2-b,3-c,4-d c) Both a and b d) None Ans. b 264. According to another approach the sole cause of inflation is the Existence of persistence Excess ----- in the economy a) Supply b) Demand c) Both a and b d) None Ans. b 265. -------- refers to situation where in prices rise on account of increasing cost of production a) Cost pull inflation b) Cost push inflation c) Demand pull inflation d) All Ans. b 266. During the period of war, shortage of essential goods create rise in a) Prices b) Demand c) Both a and b d) None Ans. a 267. The value of money and price level are ------- related a) Positively b) Reversely c) Negatively d) Both b and c Ans. d 268. A state of steady fall in price is called a) Inflation b) Stagflation c) Deflation d) None Ans. c 269. Inflationary gap is a ----- concept a) Phillips b) Pigou c) Keynesian d) All Ans. c 270. Deflation is a state of a) Falling prices b) Falling income c) Falling employment d) All Ans. d

261. Inflation is a sin; every government -------- it a) Denounces b) Practices c) Both a and b d) None Ans. c 262. According to ---------- an inflationary rise in price cannot take place before the point of full employment a) Keynes b) A.C. Pigou c) Both a and b d) None Ans. a 263. The Cambridge economists like Lord Keynes and A.C. Pigou viewed inflation as a phenomenon of a) Monitory b) Full employment

MANAGERIAL ECONOMICS
271. ---------- Inflation may be defined as a situation where the total ----------- persistently exceeds total supply of goods at current prices, so that prices are pulled upwards by the continuous upward shift of the aggregate demand function. a) Demand pull, demand b) Demand push, monetary demand c) Demand pull, monetary demand d) None Ans. c 272. Cost of production increases when a) Demand for higher wages by the labor class b) Fixing up of higher profit margins by the manufactures c) Introduction of new taxes d) All Ans. d 273. According to -------- The ------- is the amount by which aggregate expenditure would exceed aggregate output at the full employment level of income. a) Lipsey, inflationary gap b) Kenyas, demand pull c) Pigou, cost push d) None Ans. a 274. Measures to wipe out inflationary gap is a) Increase in savings to reduce aggregate demand b) Raise the out put to match the disposable income c) Raise the taxes to mop up the excess purchasing power d) All of the above Ans. d 275. ----------- is a portmanteau term in macro economics used to describe a period with a high rate of inflation combined with ------------- and economic recession. a) Stagflation, Employment b) Inflation, employment c) Stagflation, unemployment d) All Ans. c 276. ---------- the British economist was the fist to identify the inverse relationship between the rate of ------- and the rate of increase in --------a) A.W.P. Phillips, unemployment, money wages b) A.W. Phillips, unemployment, money wages c) A.W. Phillips, employment, money wages d) None of the above Ans. b

277. The above is a diagram of a) Demand pull inflation b) Demand push inflation c) Both a and b d) None Ans. a 278. Match the following Set - A 1. Creeping inflation 2. walking inflation 3. running inflation 4. hyper inflation Set - B a) 3% b) 7% c) 15% d) 25% A) B) C) D) Ans. D 1-a,2-c,3-d,4-d 1-a,2-b,3-d,4-c 1-b,2-a,3-c,4-d 1-a,2-b,3-c,4-d

279. State which statements are true for anti-inflationary monetary measures? 1. Restrictions on bank credits 2. Freezing and blocking particular type of assets 3. Increasing bank rate and other interest rates 4. Sale of Govt., securities in the open market by central bank 5. Raising the legal reserve requirements like CRR and SLR 6. Regulation of consumers credit 7. rationing of credit etc. a) b) c) d) Ans. d 1,2,3,4,5 4,5,6,7 3,4,5 All

280. Gross national Income at current prices is 20000, Local Taxes is 5000, Saving of the community is 3000, Gross national product at pre inflation prices is 15000, Govt. Exp. 6000. Calculate the inflationary gap. a) 6000 b) 8000

MANAGERIAL ECONOMICS
c) 9000 d) 3000 Ans. d 281. The term ----------- refer to a benefit or cost associated with an economic transaction, which is not taken into account by those directly involved in making it. a) Positive externality b) Negative externality c) Externality d) None Ans. c 282. MSB = a) MPB + MSC b) MPB + MEC c) MPB + MEB d) None Ans. c 283. MSC = a) MPC + MEC b) MPB + MSC c) MPB + MEC d) None Ans. a 284. ----------- arises as a result of excessive use of fertilizers, soil erosion etc. a) Air pollution b) Soil pollution c) Both a and b d) None Ans. b 285. Natural environment includes a) Land form b) Location aspects c) Topographical conditions d) All of the above Ans. d 286. ---------- has suggested an alternative approach to tackle the problem of externailities a) Prof. Monad H. Coase b) Prof. Ronald H. Coase c) Prof. Ronald P. Coase d) None of the above Ans. b 287. Environmental pollution is an example for ---------a) Negative externailities b) Positive externailities c) Externailities d) All Ans. a 288. The term acid rain was first introduced in a) 1856 b) 1877 c) 1872 d) 1972 Ans. c 289. The factor which contributed for environmental degradation is a) Water b) Soil c) Deforestation d) All Ans. d 290. Markets are purely guided by --------a) Social profit considerations b) Private profit consideration c) All of the above d) None of the above Ans. b 291. Installation of pollution control equipment in factories in a specific way is the example of a) Internalizing externalities b) Direct government regulations c) All of the above d) None of the above Ans. b 292. ------------- is a legal limit on how much -------- a firm can emit a) Emission standard, pollution b) Direct government regulation, externalities c) Both a and b d) None Ans. a 293. ----------- refer to accidents resulting from nuclear device and -------a) Soil accidents, Radio active materials b) Nuclear accidents, Radio materials c) Nuclear accidents, Radio active materials d) None of the above Ans. c 294. Management students should be aware of these -----problems in its right perspective as it helps them to take right decisions as ----------a) Global, their studies b) Global, prospective managers c) Both a and b d) None Ans. b

MANAGERIAL ECONOMICS
295. --------- on earth means progressive warming up of the earths surface due to the blanketing effect of man made carbon dioxide with atmosphere a) Global b) Soil pollution c) Deforestation d) Green house effect Ans. d 296. In --------- accident, half of the nuclear power reactor was completely burnt, releasing ---------a) 28th March, 1978, carbon dioxide b) 18th March, 1979, radioactivity c) 28th March, 1979, radioactivity d) None Ans. c 297. Match the following according to the following diagram b) The government has to subsidize producers c) The government has to tax on producers d) The government has to subsidize consumers A) B) C) D) Ans. C 1-a,2-c,3-b4-d 1-d,2-b,3-c,4-a 1-c,2-b,3-a,4-d 1-a,2-b,3-c,4-d

299. The -------- effect on earth means --------- of the earths surface due to the --------- effect of man made -----in the atmosphere. a) Greenhouse, warming, blanketing, carbon dioxide b) Greenhouse, progressive warming, blanketing, carbon dioxide c) Greenhouse, progressive warming, air polution, carbon dioxide d) None of the above Ans. b 300. Match the following Set - A 1. Positive externality in consumption 2. Negative externality in consumption 3. Positive externality in production 4. negative externality in production Set - B a) Govt. provides various kinds of vaccinations b) A young man rides a noisy motor cycle c) Beekeepers try to put their beehives on farms d) When an industrial unit dumps its industrial wastages in to the near by river A) B) C) D) Ans. D 1-b,2-a,3-c,4-d 1-a,2-b,3-d,4-c 1-a,2-c,3-b,4-d 1-a,2-b,3-c,4-d

Set - A 1. 2. 3. 4. Set - B a) b) c) d) A) B) C) D) Ans. D A B C D

MSB MPB MSC = MPC Net benefit to the society 1-a,2-b,3-c,4-d 1-a,2-c,3-b,4-d 1-a,2-b,3-d,4-c 1-b,2-a,3-c,4-d

298. Match the following Set - A 1. MSC > MPC 2. MSC< MPC 3. MSB < MPB 4. MSB> MPB Set - B a) The government has to tax on consumers

MANAGERIAL ECONOMICS