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This set of Managerial Economics 1 Multiple Choice Questions & Answers (MCQs) focuses on Managerial Economics 1 Set 11

Q1 | The condition for the long run equilibrium of a perfectly competitive firm
  • Price=MC=AC
  • Price=TC
  • MC=AVC
  • MC=MR
Q2 | Product differentiation is the important feature of
  • monopoly
  • perfect competition
  • monopolistic competition
  • monophony
Q3 | The no. of firms under oligopoly is
  • 1
  • 2
  • many
  • few
Q4 | The law of diminishing returns applies more to
  • agriculture
  • industry
  • services
  • commerce
Q5 | The opportunity cost of a given activity is
  • the value of next best activity
  • the value of material used
  • the cost of input used
  • none of these
Q6 | The function of combining the other factors of production is done by
  • land
  • labour
  • Capital
  • Entrepreneurship
Q7 | The factors used in the production
  • Land and labor
  • capital & entrepreneurship
  • both a&b
  • only capital
Q8 | In a perfect market both buyers and sellers are
  • price maker
  • price giver
  • price taker
  • all the above
Q9 | Which is the determinant of the pricing policy of a firm?
  • Channel of distribution
  • Age of product
  • Consumer association
  • All of these
Q10 | Information for pricing decisions involves:
  • Product information
  • Market information
  • Information at the micro level
  • All of these
Q11 | Which is the reason of skimming price?
  • Inelastic demand
  • Diversion of market
  • Safer price policy
  • All of these
Q12 | Which is the condition of for market penetration?
  • High price elasticity of demand in the short run
  • Savings in production costs
  • Threat of potential competition
  • All of these
Q13 | Production may be defined as an act of:
  • Creating utility
  • Earning profit
  • Destroying utility
  • Providing services
Q14 | The demand curve of a firm in the case of perfect competition is:
  • Parallel to output axis
  • Increasing with the output axis
  • Decreasing with the output axis
  • Complete
Q15 | The implication of the kinked demand curve is reflected in a discontinuity in the:
  • Marginal revenue curve
  • Marginal cost curve
  • Total revenue curve
  • Total cost curve
Q16 | A firm that is the sole seller of a product without close substitutes called:
  • Monopoly
  • Oligopoly
  • Competition
  • Bureaucracy
Q17 | When all the productive services are increased in a given proportion, the product isincreased in the same proportion. This situation is called:
  • Law of increasing
  • Situation of constant returns
  • Fixed cost
  • Variable cost
Q18 | Which factors is/are influencing price policy?
  • Cost of product
  • Time factor
  • Government policy
  • All of these
Q19 | Pricing methods are:
  • Standard cost method
  • Learning curve method
  • Marginal cost method
  • All of these
Q20 | Which is the feature of perfect competition?
  • Large number of buyers and sellers
  • Freedom of entry and exit
  • Normal profit in the long run
  • All of these
Q21 | Which is/are the salient features of monopolistic competition?
  • Large number of sellers
  • Normal profit
  • Free entry and exit of firms in industry
  • All of these
Q22 | Which are the characteristics of monopoly?
  • Single seller or producer
  • No close substitutes
  • Inelastic demand curve
  • All of these
Q23 | The causes of emergence of monopoly is/are:
  • Concentration of ownership of raw materials
  • State regulation
  • Public utility services
  • All of these
Q24 | Which are not the features of oligopoly?
  • Few sellers
  • Advertising and sales promotion
  • One firm
  • Conflicting attitudes of firms
Q25 | The monopoly can be controlled by:
  • Social boycott
  • Antimonopoly legislation
  • Public ownership
  • All of these