Q1. Laws of
production does not include …………
production does not include …………
(a) returns
to scale.
to scale.
(b) law of
diminishing returns to a factor
diminishing returns to a factor
(c) law of
variable proportions.
variable proportions.
(d) least
cost combination of factors.
cost combination of factors.
Q2. Identify
the fixed cost from the following:
the fixed cost from the following:
(a) Labour
cost.
cost.
(b) Electricity
bill
bill
(c) Salary
of watchman
of watchman
(d) Cost of
machines
machines
Q3. Which of the following is not
as assumption of the law of variable proportions
as assumption of the law of variable proportions
(a) Only one
factor is variable.
factor is variable.
(b) Technique
of production remains constant.
of production remains constant.
(c) Proportion
of factors of production remains same.
of factors of production remains same.
(d) Units of
variable factor are homogeneous.
variable factor are homogeneous.
Q4. Which of
the following statements is correct?
the following statements is correct?
(a) Supply
of land is perfectly elastic.
of land is perfectly elastic.
(b) Fertility
of land cannot change.
of land cannot change.
(c) Land
does not yield any result unless human efforts are employed.
does not yield any result unless human efforts are employed.
(d) Supply
of land can be increased.
of land can be increased.
Q5. Which of
the following is a variable cost in the short run?
the following is a variable cost in the short run?
(a) rent of
the factory
the factory
(b) wages
paid to the factory labour
paid to the factory labour
(c) interest
payments on borrowed financial capital
payments on borrowed financial capital
(d) payment for
factory equipment
factory equipment
Q6. The
efficient scale of production is the quantity of output that minimizes
efficient scale of production is the quantity of output that minimizes
(a) average
fixed cost
fixed cost
(b) average
total cost
total cost
(c) average
variable cost
variable cost
(d) marginal
cost
cost
Q7. If
marginal cost equals average total cost,
marginal cost equals average total cost,
(a) average
total cost is constant
total cost is constant
(b) average
total cost is rising
total cost is rising
(c) average
total cost is maximized
total cost is maximized
(d) average
total cost is minimized
total cost is minimized
Q8. In the
long run
long run
(a) all
inputs are fixed
inputs are fixed
(b) all
inputs are variable
inputs are variable
(c) at least
one input is variable and one input is fixed
one input is variable and one input is fixed
(d) at most
one input is variable and one input is fixed
one input is variable and one input is fixed
Q9. Average
product is defined as
product is defined as
(a) total
product divided by the total cost
product divided by the total cost
(b) total
product divided by marginal product
product divided by marginal product
(c) total
product divided by the variable input
product divided by the variable input
(d) marginal
product divided by the variable input
product divided by the variable input
Q10. The
change in the total product resulting from a change in a variable input is
change in the total product resulting from a change in a variable input is
(a) average
cost
cost
(b) average
product
product
(c) marginal
cost
cost
(d) marginal
product
product
Q11.
Under which of the following forms of market structure does a firm have no
control over the price of its product?
Under which of the following forms of market structure does a firm have no
control over the price of its product?
(a) Monopoly
(b)
Monopolistic competition
Monopolistic competition
(c)
Oligopoly
Oligopoly
(d) Perfect
competition
competition
Q12.
Discriminating monopoly implies that the monopolist charges different prices
for his commodity:
Discriminating monopoly implies that the monopolist charges different prices
for his commodity:
(a) from
different groups of consumers
different groups of consumers
(b) for
different uses
different uses
(c) at
different places
different places
(d) any of
the above
the above
Q13. Price discrimination
will be profitable only if the elasticity of demand in different sub markets:
will be profitable only if the elasticity of demand in different sub markets:
(a) uniform
(b)
different
different
(c) less
(d) zero
Q14. In the context of oligopoly, the Kinked demand hypothesis is designed to
explain
(a) Price
and output determination
and output determination
(b) Price
rigidity
rigidity
(c) Price
leadership
leadership
(d)
Collusion among rivals.
Collusion among rivals.
Q15. The
firm in a perfectly competitive market is a price taker. This designation as a
price taker is based on the assumption that
firm in a perfectly competitive market is a price taker. This designation as a
price taker is based on the assumption that
(a) the firm
has some, but not complete, control over its product price.
has some, but not complete, control over its product price.
(b) there
are so many buyers and sellers in the market that any individual firm cannot
affect the market.
are so many buyers and sellers in the market that any individual firm cannot
affect the market.
(c) each
firm produces a homogeneous product.
firm produces a homogeneous product.
(d) there is
easy entry into or exit from the market place.
easy entry into or exit from the market place.
SOLUTIONS
S1. Ans.(d)
Sol.
S2. Ans.(d)
Sol.
S3. Ans.(c)
Sol.
S4. Ans.(a)
Sol.
S5. Ans.(b)
Sol.
S6. Ans.(b)
Sol.
S7. Ans.(a)
Sol.
S8. Ans.(b)
Sol.
S9. Ans.(c)
Sol.
S10. Ans.(d)
Sol.
S11. Ans.(d)
Sol.
S12. Ans.(d)
Sol.
S13. Ans.(b)
Sol.
S14. Ans.(b)
Sol.
S15. Ans.(b)
Sol.
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