Question # 1

If a monopolist faces a downward sloping market demand curve its.

Choose an answer

Average revenue is always less than marginal revenue

Marginal revenue is greeter than the price of the units it sells.

Average revenue is less than the price of its product.

Marginal revenue is always less than the price of the units it sells

A situation in which firms choose their best strategy given the strategies chosen by the other firms in the market is called.

Choose an answer

a competitive equilibrium

An open market solution

The Nash equilibrium

The cartel equilibrium

Which of the following will not be a determinant of the price elasticity of demand for a commodity.

Choose an answer

The absence of substitute for the good.

The presence of substitutes for the good.

The importance of the commodity in consumers budgets

The cost of producing the commodity

In perfect competition a firm is.

Choose an answer

Price taker

Price setter

Independent

Dependent

The price of Ketchup at a market increases by 12.5% per can, which results in a decrease in quantity purchased by 40% per week, the demand is.

Choose an answer

Relatively elastic

Relatively inelastic

Perfectly elastic

Perfectly iinelastic

Cross -elasticity following commodities is very high

Choose an answer

Compliments

Normal

Goods substitutes

Good compliments

If a price floor of Rs.15 is imposed, the governments cost is.

Choose an answer

Rs.150

Rs.300

Rs.750

Rs.450

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

Choose an answer

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

If a monopolist's demand curve is downward sloping and linear, then its total revenue curve must be.

Choose an answer

Identical to the demand curve

A ray from the origin with a slope equal to price

negative sloped with twice the slope of the demand curve

A rising function of output that increases at a decreasing rate , reaches a maximum, then falls.

A consumer is said to be in equilibrium when the marginla utility and price of a commodity

Choose an answer

More

Less

Irrelevant

Equal

Labour has the following characteristics accept one.

Choose an answer

It cannot be separated form labourer

It cannot be stored

Its supply cannot be increase at once

Bargaining power of laborer is very strong

Law of demand is not applicable on

Choose an answer

Daily goods

Scarce goods

Consumer goods

Producer goods

A firm's long run average total cost lineis

Choose an answer

Identical to its long run marginal cost line

Also its long run supply curve

In fact the average total cost curve of the optimal plant

Tangent to all the curve of short run average total cost

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

Choose an answer

The equilibrium price

The use of substitutes

The equilibrium quantity

All of the above

The most important determinant of price elasticity is.

Choose an answer

The slope of the demand curve

The availability of substitutes

The price of other goods

The income of the consumer

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

Choose an answer

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 law of diminishing marginal returns to a factor of production is.

Choose an answer

Not applicable

Another explanation of economies of scale

A principle of scales

None of these

Projects A,B,C,D,E cost Rs. 100, Rs, 200, Rs. 300, Rs. 400, and Rs. 500 with MEC's of 0.07, 0.06,0.09 ,0.10 and 0.11 respectively. The market rate of interest is 8% Total investment spending is

Choose an answer

Rs. 1500

Rs.1300

Rs.1200

Rs.300

The "compensated" demand curve is the demand curve that.

Choose an answer

Shows only the income effect

Shows only the substitution effect

Shows both the income and substitution effects

Shows the Geffen good demand curve

In contract to perfectly competitive markets monopolists

Choose an answer

Do no have to worry about market demand

Sell only if demand is inelastic

Can never incur an economic loss

Can earn an economic profit indefinitely

Which of the following shifts the demand curve for hot dogs leftward.

Choose an answer

An increase in the price of a hot dog bun

A decreases in the price of a hot dog bun

An increased in the price of a hamburger

An increases in the price of a hot dog

More Classes

Other Links

PPSC Economics Chapter 2 Micro Economics MCQs With Answers

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer

Choose an answer