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This set of Micro economics 2 Multiple Choice Questions & Answers (MCQs) focuses on Micro Economics 2 Set 16

Q1 | Monopolist can fix
  • Both price and output
  • Neither price and output
  • Either price and output
  • None of the above
Q2 | A discrimination monopolist charges in a market
  • Lower prices if it has lower elasticity
  • Higher prices if it has lower elasticity
  • Lower prices if it has higher elasticity
  • Cannot say
Q3 | A firm practicing price discrimination will be
  • Changing qualities of the product
  • Buying from the cheapest market
  • Buying from firms
  • Charging different prices in different markets
Q4 | The best level of output for the monopolist is
  • AC is minimum
  • TC=TR
  • TR and TC are parallel
  • TR is maximum
Q5 | If the monopolist faces identical demand for his commodity in the two separate markets, by practicing third degree pricediscrimination
  • Will increase his TR and total profit
  • Can increase his TR and profit
  • Cannot increase his TR and profit
  • Will charge different prices in different market
Q6 | Under pure monopoly, there will be
  • No distinction between firm and industry
  • One firm no industry
  • No firm one industry
  • Very few firms
Q7 | Monopolist will not produce that portion of demand curve where theelasticity of demand
  • Equal to unity
  • Less than unity
  • Greater than zero
  • None of the above
Q8 | Under monopoly, the equilibrium price is
  • Equal to MC
  • Less than MC
  • More than MC
  • Equal to AC
Q9 | The cross elasticity of demand for the monopolist product is
  • Very low
  • Moderate
  • High
  • Very high
Q10 | Which of the following is known as the perfect price discrimination
  • First degree price discrimination
  • Second degree price discrimination
  • Third degree price discrimination
  • Nine of the above
Q11 | A monopolist usually earns
  • Economic profit
  • Only normal profit
  • Losses
  • Profit and losses, which are uncertain
Q12 | Price discrimination is possible
  • Under any market form
  • Only under monopoly
  • Only under monopolistic competition
  • Only in perfect competition
Q13 | Who introduced various types of price discrimination
  • Alfred Marshall
  • Adam Smith
  • A C Pigou
  • J B Say
Q14 | Oligopoly is a market situation characterized by
  • Large number of buyers and sellers
  • A single seller
  • Fairly large number of buyers and sellers
  • A few sellers
Q15 | Price leadership can be in the form of
  • Price leadership by a low cost firm
  • Price leadership by a dominant firm
  • A barometric price leadership
  • All of the above
Q16 | Assertion (A) Many oligopolistic industries exhibit an appreciabledegree of Price rigidity or stability Reason (R) Oligopolists face a demand curve that is highly elastic for price increases and less elastic for price reductions
  • (A) is true but (R) is false.
  • Both (A) and (R) are false
  • Both (A) and (R) are true and (R) is the correct explanation of (A)
  • Both (A) and (R) are true but (R) is not the correct explanation of (A)
Q17 | The equilibrium level of output for a perfectly competitive marketis
  • MC = AC
  • MC = MR
  • TC = TR
  • None of the above
Q18 | The term ‘monopsony’ refers to
  • a single seller
  • a single buyer
  • a single buyer and a single seller
  • None of the above
Q19 | In Chamberlin and Kinked demand curve model, the oligoposist
  • Recognize their interdependence
  • Do not collude
  • Tend to keep prices constant
  • All of the above
Q20 | If an oligopolist incurs losses in the short run, then in the longrun
  • The oligopolist will go out of business
  • The oligopolist will stay in business
  • The oligopolist will break-even
  • Any of the above
Q21 | Existence of large number of buyers and sellers andhomogenous product is a feature of :
  • Monopoly
  • Duopoly
  • Perfect Competition
  • Oligopoly
Q22 | Product differentiation is a characteristic of:
  • Monopoly
  • Perfect Competition
  • Monopolistic Competition
  • Oligopoly
Q23 | A firm under Perfect Competition is a:
  • Price maker
  • Price taker
  • Monopolist
  • None of these
Q24 | Selling cost is a feature of :
  • Perfect Competition
  • Monopoly
  • Monopolistic Competition
  • Oligopoly
Q25 | Oligopoly is characterized by:
  • A few Sellers
  • One seller
  • Large Sellers
  • All of these