NET, IAS, State-SET (KSET, WBSET, MPSET, etc.), GATE, CUET, Olympiads etc.: Economics MCQs (Practice_Test 73 of 122)
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- In the theory of production with one variable input, which one of the following will not hold when the Average Product (AP) is at its peak?
- Declining Total Product (TP) curve
- Increasing Total Product (TP) curve
- Declining Marginal Product (MP)
- MP = AP
- Which one of the following is represented by the diagram given above (where, L = labour, K = capital, X = output) ?
- Laws of production
- Decreasing returns to scale
- Diminishing returns to variable factor, labour
- All of the above
- Which one of the following statements is correct?
- A firm՚s long run average cost curve is derived from a series of short run average cost curves
- There is no relationship between shortrun and long-run average cost curves
- A firm՚s short-run average cost curve is derived from its long-run average costcurve
- Long-run total cost is the sum of longrun fixed and long-run average costs
- Which one of the following is represented by a rectangular hyperbola?
- Average fixed cost curve
- Average variable cost curve
- Production possibility curve
- Expansion path
- Consider the following statements:
- Explicit and implicit costs are not included in opportunity cost.
- Explicit and implicit costs are included in opportunity cost.
- The economic costs include both explicit and implicit costs
- The imputed value of the entrepreneur՚s own resources and services is called explicit costs.
- Which of the statements given above are correct?
- 1 and 2
- 2 and 3
- 1 and 3
- 2 and 4
- Match List-I (Type of Isoquant) with List II (Factor Substitutability) and select the correct answer using the code given below the Lists:
Table Supporting: NET, IAS, State-SET (KSET, WBSET, MPSET, Etc.) , GATE, CUET, Olympiads Etc. : Economics MCQs (Practice_Test 73 of 122) List-I List-II - Linear isoquant
- Leontief isoquant
- Kinked isoquant
- Smooth, convex isoquant
- Zero substitutability
- Continuous substitutability
- Perfect substitutability
- Limited substitutability
- A
- B
- C
- D
- 3
- 2
- 4
- 1
- 4
- 1
- 3
- 2
- 3
- 1
- 4
- 2
- 4
- 2
- 3
- 1
- In the Cobb-Douglas production function of the form, X = b0, Lbl, kb2, which one of the following is correct (X = output, L = labour and K = capital) ?
- Elasticity of substitution is equal to unity
- Factor-intensity is measured by the ratio, b1⟋b2
- Organisational and entrepreneurial efficiency is measured by b0
- All the above
- Suppose a consumer is consuming two somewhat substitutable goods X and Y and the price of X increases. What is the nature of consumer՚s demand for X if he decreases his expenditure on X?
- Unitary elastic
- Perfectly inelastic
- Elastic
- Inelastic
- Which one of the following is not the basic assumption of indifference curve approach of consumer theory?
- Consumer is able to set up preference ranking of the combination of goods and services.
- Consumer is able to measure the utility.
- The ranking is consistent.
- Consumer prefers more to less of a commodity.
- Consider the following statements:
- Cross elasticity of demand for petrol with respect to price of diesel is close to zero in the short-run but it may increase in the long run if the price differential between these two products remains high for long.
- Cross elasticity of demand of X with respect to Y would be negative if X and Y are substitutes.
- Cross elasticity of demand of X with respect to Y would be positive if X and Y are complements.
- Cross elasticity of demand of X with respect to Y would be close to zero if X and Y are unrelated products.
- Which of the statements given above are correct?
- 1,3 and 4, only
- 2 and 3, only
- 1 and 4, only
- 1,2, 3 and 4
- Which one of the following is the correct statement? In the case of Giffen goods
- substitution effect is negative
- income effect is negative
- income effect is stronger than the substitution effect
- All the above three
- Which one of the following is the correct statement? Given two parallel straight-line demand curves, the price-elasticity of demand in case of each curve is equal
- at each price level
- at each demand level
- only at points on these demand curves which fall on a straight line emanating from the origin
- in none of the above cases
- Which of the following are the characteristics of the kinked demand curve?
- Equilibrium is defined by the point of kink.
- Price rigidity under oligopoly.
- The upper portion of the kinked demand curve is highly elastic.
- To the point right of kink, marginal cost is larger than marginal revenue.
- Select the correct answer using the code given below:
- 1,2 and 3, only
- 1 and 4, only
- 2,3 and 4, only
- 1,2, 3 and 4
- Consider the following statements regarding determination of factor prices:
- The mechanism of determination of factor prices does not differ fundamentally from that of prices of commodities.
- Factor prices are determined by the forces of demand and supply.
- The difference lies in the determinants of the demand and supply of productive resources.
- Which of the statements given above are correct?
- 1,2 and 3
- 1 and 2, only
- 2 and 3, only
- 1 and 3, only
- Which one of the following is the correct statement? The demand for labour is a derived demand because it depends on
- the elasticity of labour supply
- the demand for other factors of production
- the wage rate
- the demand for goods and services produced by labour