Question # 1

In a typical cartel agreement the cartel maximizes profit when it.

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Behaves like a monopoly

Behaves like a perfectly competitive firm

Behaves like a duopoly

Is flexible in enforcing production targets

When the price of a pizza decreased from 1200 Rupees to 1000 Rupees, it is definitely the case that the.

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Income effect means people buy less pizza

Substitution effect means people buy more pizza

Quantity demanded of pizza will not change

None of the above

"Principles of economics" is the book of

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Robbins

Adam smith

Hicks

Marshall

A negatively sloped isoquant implies

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Products with negative marginal utilities

Products with positive marginal utilities

Inputs with negative marginal products

Inputs with positive marginal products

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

A drop in the price of compact disc shifts the demand curve for prerecord tapes leftward from that you know that compact discs and precorded tapes are.

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Inferior goods

Substitutes

Complements

Normal goods

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

Duopoly is a market situation when there is

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Single seller

Many seller

Two seller

Few seller

Goods which can be consume directly are

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Producer goods

Consumer goods

Free goods

Economics goods

Perfect competition implies

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Homogeneous goods

Inferior goods

Superiors goods

Differential goods

The "Law of demand" states that other things remaining the same the quantity demanded of any good is.

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Directly related to its price

Positively related to its price

Inversely related to its price

Directly elated to the supply of the good

An -increase the expected future price of a good.

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Increases its demand

Decreases its demand

Increases its supply

Has no effect on either its demand or its supply.

The same graph shows that the firm order to maximize profits , should produce.

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30 units charges a price of Rs. 16

20 Units and charge a price of Rs. 22

35 Units and charge a price of Rs. 12

38 units and charge a price or Rs. 10

When the quantity demanded is changed on the same price

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the demand curve shifts upward

The demand curve shifts downward

Movement on the same demand curve

None of these

Which of the following does not characterize monopolistic competition.

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Product differentiation

Many producers

Absence of advertising

Some control over price

If a firm triples all inputs and output triples as well the firm is subject to

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Constant returns to scale

Increasing returns to scale

Economies of scale

Both b and c

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

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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.

An exceptional demand curve is.

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Vertical

Horizontal

Downward sloping

Positive slope

Suppose an individual spends all his income on only two goods, good X and good Y moreover suppose that you were asked to derive his price consumption curve for good Y Which of the following would be allowed to very.

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Money income

The tastes of the consumer

The price of good X

The price of good Y

The marginal rate of substitution of two goods can be obtain from

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Slope of budget line

Slope of demand curve

Slope of indifference curve

None of these

In monopsony there is

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Single seller

Two buyers

Single buyer

Few buyer

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