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This set of Economics of Business and Finance Multiple Choice Questions & Answers (MCQs) focuses on Economics Of Business And Finance Set 2

Q1 | A fall in the price of the commodity whose demand curve is a rectangularhyperbola causes total expenditure on the commodity
  • increases
  • decreases
  • remains unchanged
  • none of the above
Q2 | If the quantity demanded remains unchanged as the price of thecommodity falls, the coefficient of price elasticity of demand is
  • greater than
  • one equal to one
  • smaller than one
  • zero
Q3 | An increase in the price of the commodity when demand is inelasticcauses the total expenditure of consumers of the commodity to
  • increase
  • decrease
  • remains unchanged
  • any of the above
Q4 | A negative income elasticity of demand for a commodity indicates that asincome falls, the amount of the commodity purchased
  • rises
  • falls
  • remains unchanged
  • none of the above
Q5 | Most common form of price discrimination is
  • first degree price discrimination
  • second degree price discrimination
  • third degree price discrimination
  • fourth degree price discrimination
Q6 | If the income elasticity of demand is greater than one, then thecommodity is
  • necessity
  • luxury
  • inferior
  • non-related commodity
Q7 | If the income elasticity of demand for a commodity is found to be 0.4,then the commodity concerned is
  • luxury
  • necessity
  • giffen’s goods
  • independent good
Q8 | A fall in income of the consumer, other things being equal, causes
  • increase in demand
  • decrease in demand
  • increase in quantity demanded
  • decease in quantity demanded
Q9 | Which of the following Elasticities measure movement along a curve,rather than a shift in the curve
  • price elasticity of demand
  • income elasticity of demand
  • cross elasticity of demand
  • none of the above
Q10 | Cross elasticity of demand in the case of substitutes
  • zero
  • negative
  • positive
  • infinity
Q11 | A movement down the given demand curve shows
  • increase in demand
  • decrease in demand
  • extension in demand
  • contraction in demand
Q12 | Which of the following results in an increase in an increase in demand
  • fall in prices of substitutes
  • increase in price of complementary goods
  • fall in consumer’s income
  • none of the above
Q13 | When total product is maximum, marginal product is
  • maximum
  • positive
  • zero
  • negative
Q14 | Who popularized the degrees of price discrimination
  • alfred marshall
  • pigou
  • keynes
  • jevons
Q15 | As a result of a fall in the price total expenditure on the commoditydecreases, the coefficient of elasticity will be
  • equal to one
  • greater than one
  • less than one
  • cannot sa
Q16 | If a small change in price leads to infinitely large change in quantitydemanded, then the demand is
  • perfectly elastic
  • perfectly inelastic
  • elastic
  • inelastic
Q17 | When demand curve is rectangular hyperbola, the value of priceelasticity of demand will be
  • zero
  • one
  • greater than one
  • infinity
Q18 | Consumers are denied of any consumer surplus in ------- degree of pricediscrimination
  • first
  • second
  • third
  • fourth degree price discrimination
Q19 | On a linear demand curve, the coefficient of price elasticity is unity, thenthe value of MR will be
  • positive
  • zero
  • negative
  • one
Q20 | Business economics lie at the borderline between economics and ------
  • political science
  • commerce
  • management
  • statistics
Q21 | Planning for future is also called
  • logistic planning
  • capital planning
  • forward planning
  • none of the above
Q22 | Economics is concerned with allocation of --------- resources
  • abundant
  • unlimited
  • scarce
  • redundant
Q23 | The cost of next best alternative is called ---------
  • opportunity cost
  • marginal cost
  • total cost
  • sink cost
Q24 | The most important objective of the producer is -----
  • maximum sales
  • maximum profit
  • maximum revenue
  • maximum cost
Q25 | Who is the author Principles of Economics
  • adam smith
  • alfred marshall
  • j m keynes
  • friedman