Question # 1

If the estimated values of Y and Py in 1987 are Rs. 20,000 and Rs. 6 respectively, what is the maximum price of X.

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Rs.420

Rs.240

Rs.300

Rs.360

If the price of an apple increased from 50 to 60 the quantity demanded will decrease because of.

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The substitution effect only

The income effect only

A change in income

The substitution and income effects.

Extension and contraction of demand mean

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Movement on the same demand curve

Movement to high demand curve

Movement to lower demand curve

Movement to another demand curve

If leisure is an inferior good the individuals supply curve for labor is.

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Back ward bending

Completely inelastic

Upward sloping

Perfectly elastic

Holding all other things constant a higher price for ski lift tickets would.

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Increase the number of skiers

Increase the price of skis

Decrease the number of skis sold

Decrease the demand for other winter recreational activities

If average variable cos tis less then marginal cost then certainly.

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Per unit total cost is rising

Per unit total cost is constant

Per unit total cost is falling

Per unit variable cost is rising

The Isoquant curve shows different combinations of two factors of production which give the producer.

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Different level of output

High level of output

low level of output

Same level of output

A price cross elasticity of 0.81 between X and Y shows that.

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They are complementary goods

They are competitive substitutes

They are not substitutes

a reduction in the price of one would cause an increase in the consumption of the other.

If a simultaneous and equal percentage decrease in the use of all physical inputs leads to a larger percentage decrease in physical output a firm's production function is said to exhibit.

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Decreasing returns to scale

Constant returns to scale

Increasing returns to scale

Diseconomies of scale

As the opportunity cost of a good falls, ceteris paribus the substitution effect implies that people buy

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Less of the good and more of its substitutes

More of that good and less of its substitutes

Less of that good and less of its substitutes

More of that good and more of its substitutes

In price discrimination, which section of the market is charged the higher price.

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The section with the richest people

The section with the oldest people

The section with the most inelastic demand

The section with the most elastic demand

the ouput where diminishing return to production begin is also the ouput where

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Marginal cost is at a minimum.

Average total cost is at a minimum

Average variable cost is at a minimum

Marginal and average

If a good is normal then the demand curve for that good must be.

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Downward sloping

Upward sloping

Perfectly elastic

Completely inelastic

When the demand curve is a straight line the elasticity of demand at the center point will be.

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Equal to zero

infinite

More than one

Equal to one

If A is preferred to B and B is preferred to C and there is indifference between A and D

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D is preferred to C

B is preferred to D

There is indifference between C and D

There is indifference between B and D

Naveed purchases product M for which his income elasticity of demand is negative Apparently product M is.

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A necessity

An independent good

An inferior good

A luxury good

The price elasticity of demand is teh same thing as the negative of the

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Slope

Reciprocal of slope

The first derivative of the demand function

Reciprocal of slope times the ratio of price to quantity

Which of the following does not apply to pareto efficiency.

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Consumptive efficiency

Productional efficiency

Allocative efficiency

Equity

If the price elasticity of demand for a non giffen good is inelastic are decreased in its price result in.

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Increase in demand

Decrease in demand

Increase in total revenue

Decrease in total revenue

Skills that embodied in a person are called.

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Human capital

Embodied skills

Physical capital

Experience skills

When due to change in price of commodity x demand of commodity y is charged it is called.

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Income elasticity

Price elasticity

More elastic

Cross elasticity

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