Question # 1

A firm will be in equilibrium where.

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Its total profit is high

Its cot is minimum

It produces at a level of output which its profit is minimum or loss in minimum

None of the three

A firm attains sub-normal profit when:

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AR = AC

AR < AC

AR > AC

TR < TC

Profit = ?

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TR - TC

TR - MC

TC - MC

TR + TC

When a competitive firm faces loss the slop of its MR curve is:

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Negative

Positive

Zero

Unity

A firm decides to shut down production temporarily when

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MC start rising

AC stat rising

price = AC

price falls below AVC

The necessary condition for equilibrium position of a firm is

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MC > MR

MC > price

MC = MR

MC = AC

In the long run under perfect competition a firm produces at a point where

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LAC is minimum

SAC is minimum

both LAC and SAC are minimum

none is minimum

profit is a maximum when

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TC and TR curves are parallel

MC and MR curves are parallel

AC and AR curves are parallel

TFC and TVC are parallel

In the long-run a competitive firms attains only:

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Normal profit

Super Normal profit

Sub-Normal profit

Marginal cost

We establish ______ conditions for equilibrium

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2

3

4

5

A firm attains sub-normal profit under perfect competition when its:

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AR = P (Price)

AR < P

AC = P

AC < P

Compare with monopoly price, the competitive price ids always:

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Less than monopoly price

More than monopoly pruce

Equal to monopoly price

Non of the three

The basic goal of a firm is to

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maximize revenues

maximize employees' welfare

maximize profit

maximize output

Normal profit is

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part of total cost

part of economic profit

part of fixed cost

total revenue minus total cost

When TR of a competitive firm is equal to its TC, the firm attains.

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Normal profit

Super normal profit

Sub-normal profit

Shutdown point

Profit is maximum when

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distance between TR and TC is maximum

distance between AR and AC is maximum

distance between MR and MC is maximum

distance between MR and AR is maximum

A competitive firm is in equilibrium in the long-run where:

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ME = AR = LMC = P

MR = AR = LMC = LAC

MR < AR = LMC <LAC

None of the three

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Economics Ics Part 1 English Medium Chapter 14 Online Test MCQs With Answers

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