General Economics 1 Set 4
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This set of General Economics 1 Multiple Choice Questions & Answers (MCQs) focuses on General Economics 1 Set 4
Q1 | A market:
- Necessarily refers to a meeting place between buyer and sellers
- Does not necessarily refers to a meeting place between buyer and sellers
- Extends over the entire country
- Extends over a city
Q2 | Net addition to total cost is called:
- Marginal cost
- Average cost
- Fixed cost
- Variable cost
Q3 | The market equilibrium for a commodity is determined by :
- Market demand
- Market supply
- Balancing of the forces of demand and supply
- Any of the above
Q4 | When there are only few sellers of the commodity, the market is called:
- Monopoly
- Duopoly
- Oligopoly
- Monopsony
Q5 | If the supply curve of the commodity is having a positive slope, a rise in the price of the commodity, results in:
- Increase in supply
- Increase in quantity supplied
- Decrease in supply
- Decrease in quantity supplied
Q6 | From the position of stable equilibrium, the market supply of a commodity decreases, while the market demand remains unchanged, then:
- Equilibrium price falls
- Equilibrium quantity rises
- Both equilibrium price and equilibrium quantity decreases
- Equilibrium price rises, but equilibrium quantity falls
Q7 | Elasticity of supply for a positively sloped straight line supply curve that intersects the price axis is:
- Equal to zero
- Equal to one
- Greater than one
- Constant
Q8 | In which of the following market, advertisement is absent:
- Monopolistic competition
- Perfect competition
- Oligopoly
- None of the above
Q9 | -------------- cost can never become zero.
- Variable cost
- Fixed cost
- Marginal cost
- Average cost
Q10 | If a positively sloped linear supply curve crosses the quantity axis, the elasticity of supply is:
- Inelastic
- Elastic
- Unitary elastic
- Perfectly elastic
Q11 | If a positively sloped linear supply curve passes through the origin, the elasticity of supply is
- Inelastic
- Elastic
- Unitary elastic
- Perfectly elastic
Q12 | Average cost is the sum of AVC and
- MC
- TC
- AFC
- ATC
Q13 | The horizontal supply curve parallel to quantity axis represents
- Elastic supply
- Inelastic supply
- Perfectly elastic supply
- Perfectly inelastic supply
Q14 | When output is zero, variable cost is --------
- Maximum
- Minimum
- Infinity
- Zero
Q15 | Change in quantity supplied of a product can result from
- Changes in own price
- Changes in cost of production
- Change in technology
- Change in price of related products
Q16 | At prices above the equilibrium price
- Quantity supplied exceeds quantity demanded
- Quantity demanded exceeds quantity supplied
- There is shortage
- All of the above is possible
Q17 | When MC cuts AC, AC is at its ------------
- Maximum
- Minimum
- Zero
- Negative
Q18 | An increase in market supply, demand remaining the same causes
- Increase in equilibrium price
- Decrease in equilibrium quantity
- Decrease in equilibrium price and increase in equilibrium quantity
- Both equilibrium price and quantity rises
Q19 | Cost function relates cost to
- Input
- Output
- Raw material
- Machines
Q20 | An increase in market demand, supply remaining the same results in
- Decrease in equilibrium price
- Decrease in equilibrium quantity
- Decrease in equilibrium price and increase in equilibrium quantity
- Both equilibrium price and quantity rises
Q21 | There is no distinction between firm and industry in
- Perfect competition
- Monopoly
- Monopolistic competition
- Oligopoly
Q22 | A fall in the market demand, supply remaining the same results in
- Increase in equilibrium price
- Increase in equilibrium quantity
- Increase in equilibrium price and decrease in equilibrium quantity
- Both equilibrium price and quantity falls
Q23 | The cost of next best alternative is called
- Marginal cost
- Average cost
- Opportunity cost
- Direct cost
Q24 | When MC is greater than AC, AC
- Rises
- Falls
- Maximum
- Minimum
Q25 | There is ------- relationship between price and quantity supplied
- Positive
- Negative
- Constant
- Inverse