11th class Economics chapter 11 online mcq test with answers for ICS part 1 Economics chapter 11 (Scale of Production and Laws of Returns)

Question # 1

The maximum point of TP curve is at quantity of labour where

Average physical product of labour is equal to 1 A
MPP of labour is at its maximum B
curves of APP and MPP of labour intersect C
MPP of labour is zero D

Question # 2

Which of the following saying describes diminishing marginal returns in the short run?

When the cat is away, the mouse will play A
Too many cooks spoil the broth B
A rolling stone gathers no moss C
A stitch in time saves nine D

Question # 3

The production function relates to

cost of output A
cost of input B
output to input C
demand to output D

Question # 4

Law of diminishing returns is a universal law as:

It does apply in all aspects of an economy. A
Basically it applies in agriculture. B
It is hard to check it. C
It applies in industry as well D

Question # 5

The law of variable proportions was presented by.

Jevens A
Rayon B
Hicks C
Valentine D

Question # 6

The law of increasing returns is also known as:

Law of increasing cost A
Law of diminishing cost B
Law of constant cost C
None of the three D

Question # 7

Which one will determine scale of production .

Financial resources A
Production techniques B
Extant of the market C
All the above D

Question # 8

during short period, diminishing returns may follow because

quantity of labour is fixed A
quality of labour is fixed B
quantity of capital is fixed C
quantity of any one factor is fixed D

Question # 9

Which of the following is example of external economies of scale?

Discount on purchases of raw materials A
Technical progress leads to development of machines at low price B
Hiring of specialized staff due to increase in scale of production C
A firm starts producing by products D

Question # 10

Economies and diseconomies of scale determine the shape of

long run AC curve A
short run AC B
average fixed cost C
none of the above D

Question # 11

Marginal product curve intersects average product curve when AP curve is

minimum A
maximum B
rising C
falling D

Question # 12

In production of goods, negative returns in the short run imply that

average product is negative A
total product is negative B
marginal product is negative C
marginal cost is falling D

Question # 13

Commercial economics are a pat of:

Internal economics A
External economics B
Economies of scale C
None of the three D

Question # 14

Which one is the third stage of production under law of variable proportions

Decreasing average returns A
Increasing average return B
Negative marginal return C
Increasing marginal return D

Question # 15

Marginal product indicates rate of change of

total product A
average product B
variable product C
all of the above D

Question # 16

In law of diminishing returns at least one factor

must be constant A
must be owned by the firm B
must be purchasable C
must be efficient D

Question # 17

The government constructed a new water reservoir for the purpose of irrigation; this might be taken as

increase in supply of capital A
increase in supply of land B
increase in supply of land and supply of capital C
none of these D

Question # 18

When average product falls marginal product

Rises A
Also falls B
Remain equal to average product C
Does not change D

Question # 19

Economics of scale are of two kinds

temporary and permanent A
internal and external B
managerial and industrial C
natural and artificial D

Question # 20

When total product rises marginal product.

Remains the same A
Falls B
Also rises C
None of the three D

Sr.#	Question	Answer
1	When average product (AP) and marginal product (MP) are rising.	A. AP > MP B. AP = MP C. AP < MP D. AP = MP = 0
2	Marginal product indicates rate of change of	A. total product B. average product C. variable product D. all of the above
3	In production of goods, negative returns in the short run imply that	A. average product is negative B. total product is negative C. marginal product is negative D. marginal cost is falling
4	Commercial economics are a pat of:	A. Internal economics B. External economics C. Economies of scale D. None of the three
5	When total product (TP) reaches its maximum, Marginal product (MP) is_	A. Zero B. Positive C. Negative D. Rising
6	The maximum point of TP curve is at quantity of labour where	A. Average physical product of labour is equal to 1 B. MPP of labour is at its maximum C. curves of APP and MPP of labour intersect D. MPP of labour is zero
7	Which of the following saying describes diminishing marginal returns in the short run?	A. When the cat is away, the mouse will play B. Too many cooks spoil the broth C. A rolling stone gathers no moss D. A stitch in time saves nine
8	Which of the following is example of external economies of scale?	A. Discount on purchases of raw materials B. Technical progress leads to development of machines at low price C. Hiring of specialized staff due to increase in scale of production D. A firm starts producing by products
9	In the second stage of the law of variable of proportions the average product:	A. Rises B. Remains constant C. Falls D. None of the three
10	When a firm using a fixed amount of land and capital takes on more workers, it finds that marginal product(MP) of labour falls but the average product(AP) of labour rises. This can be explained by the factors that	A. MP of labour is grater than AP of labour B. additional workers are more efficient C. MP and AP are equal D. AP is maximum

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