Micro Economics 2 Set 16 MCQs

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