Question # 1

Economists tend to disagree primarily about.

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The implications of scarcity for our economy

Which resources are free

Topics in positive economics

Issues of normative economics

The income elasticity of demand

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Is negative for normal goods

Is positive for normal goods

Equals the relative change in demand for a good divided by the relative change in the iincome of consumers all else being equal

Is correctly described by all of the above

MC = MR= AR=AC = Price shows the longs run

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Monopolist firm

Oligopolistic firm

Competitive firm

Both a and b

In order to constitute an oligopolistic market structure.

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There must be a few firms in a given relevant market

There must be a few firms selling in a national market

There must be more than 20 firms selling in the international market

There must be fewer than 15 firm is any given market

Which of the following would cause the demand curve for an input to shift.

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A change in technology

A change in demand for the product being produced

An increase in the number of firms in the industry

All of the above

A Market situation where the number of buyers is very large and the number of sellers are very small is called.

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Perfect competition

Duopoly

Oligopoly

In perfect competition

Under perfect competition, the price system automatically result in efficient output selection when

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MC = MR

MC = MU

P = ATC

P > AVC

An elasticity coefficient of -1 means that

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The demand curve is perfectly inelastic

The demand curve is parfectly elastic

The relative changes in price and quantity are equal

Expenditures on the good would increase if price were reduced.

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

If both supply and demand for a good increase at the same time which of the following must also increase

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The equilibrium price

The use of substitutes

The equilibrium quantity

All of the above

Which of the following is a characteristic of monopolistic competition.

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One seller serving the entire market

When each firm sells an identical product

When firms do not compete on a product quality price and marketing

When firms are free is enter and exit the market

If the estimated values of Y and Py in 1987 are Rs. 30,000 and Rs. 8 respectively the marginal revenue of X is.

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260 - 160 x

420 - 4Qx

240 - 16 Px

80 - 4Qx

Price discrimination is possible

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Oligopoly

Duopoly

Perfect competition

Monopoly

In the short run a competitive firm's supply curve is.

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Its average variable cost cure to the right of the marginal cost curve.

Its marginal cost curve above the average variable cost curve.

It marginal cost curves above its average cost curve.

The horizontal summation of the marginal cost curves

Price discrimination occurs when

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A commodity has different elasticity in different markets

Same elasticity in different markets

Unitary elasticity different markets

Noe of these

In the short run, the supply of farm commodities is.

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Inelastic

Less elastic

More elastic

Undetermined

Average fixed cost

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Is U shaped

Declines over the entire output range.

Is a long run concept only

Is influenced by diminishing returns to production

Law of variable proportion is also called.

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Law of non proportion returns

Law of substitution

Law of casts

Law of demand

The arc income elasticity of demand is approximately

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0.02

1.9

3.3

0.5

Micro economics is the study of.

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Economy on the whole

Large units of the economy

Individual units of the economy

General economics

How much will a speculator invest now if he expects to earn Rs. 144 two years from now assuming the nominal rate of interest is 20%

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Rs.1654.29

Rs.100.00

Rs.94.00

Rs.68.00

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