PPSC Economics Chapter 11 Assess Your Basics With Answers

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PPSC Economics Chapter 11 Assess Your Basics

Sr. # Questions Answers Choice
1 In a competitive industry each buyer and seller. Is a price taker Produce different products Believes that can influence price Prevents the entry of competitors
2 Holding all factors constant except one and increasing a variable factor is expected to lead to steadily decreasing marginal product of the factor this is an example of. Decreasing returns to scale The law of diminishing returns Constant returns to scale an inefficient production technique
3 The short run marginal cost curve cuts the short run total cost curve and short run average variable cost curve. At their lowest points When they are declining When they are increasing. When marginal revenue is zero
4 Short run average total costs are equal to the sum of _______ and______ Short run opportunity costs, profit Short run average variable costs, profit short run average variable costs, profit. Short run average variable costs short run average fixed costs
5 The firms long run output decision will be where. Long run average cost a lowest Marginal revenue equals output Marginal revenue equals long run marginal cost Marginal cost equals output
6 If a firm not operating at the output necessary to achieve al scale economies it has not achieved its. Efficient scale Average efficient scale Maximum efficient scale Minimum efficient scale
7 If a long average cost rises, output rises from left to right this is an example of. Increasing returns to scale Decreasing returns to scale. Constant returns to scale the minimum efficient scale
8 A production technique is technically efficient if. Output is maximized Input are minimized there is no way to make a given output using less of one input and no more of the other inputs. costs are minimized
9 If both Marginal cost and marginal revenue increase, a firm. Should increase output Should reduce output Will require further information on how to respond should not change output
10 A firm that breaks even after all economic costs are paid is earning. Economic profit Accounting profit Normal profit Supernormal profit
11 An upward shift in marginal cost ___________ output and an upward shift in _____ marginal revenue __ output. Reduce , reduce Reduce , increase Increased, increased Increases, reduces
12 Marginal revenue is the ________ when output is. Change in average revenue, inversed. change in total revenue, increased by one unit change in average revenue, increased by one unit Change in total revenue, incresed.
13 The increase in total cost when one more units is produced is known as. Marginal cost Opportunity cost Limited cost Average cost
14 Firms are assumed to ____ costs and to _______ profit. Incur , desire Pay ; make Change ;earn Minimize ; maximize
15 Adding up the quantities demanded of a good by different people facing the same price gives us the. Supply curve Market demand curve Demand curve Market supply curve
16 The extra utility from consuming one more unit of a good is called. Marginal utility Additional utility surplus utility Bonus utility
17 Economics assumes that people consume goods and services to achieve. Status Prestige Utility Self esteem
18 The opportunity cost of a student is. Course fees and rent A loan from the bank What the student could have earned in the best job available by not studying. What the student will earn after graduation.
19 If your income doubles and the prices of the goods you buy double, then your demand for these goods will likely Increase Not change Decrease Shift
20 Positive cross elasticities suggest that goods are ______ and negative cross elasticities that goods are. Substitutes, interior Normal, complements Substitutes, complements Normal , interior
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