Micro Economics Analysis Set 2 MCQs

Q1 | The importance of time element in price determination was firstlyanalyzed by

adam smith

alfred marshall

david ricardo

j m keynes

Q2 | In the market period, price determination in the case of aperishable commodity is influenced by its

demand

supply

demand as well as the supply

none of the above

Q3 | In the short-period,

all factors are fixed

some factors are fixed and others are variable

all factors are variable

none of the above

Q4 | In the long-period,

all factors are fixed

some factors are fixed and others are variable

all factors are variable

none of the above

Q5 | Zero economic profit arises in the long run in the case of

perfect competition

monopoly

monopolistic competition

oligopoly

Q6 | Zero economic profit includes

zero normal profit

normal profit

super normal profit

average profit

Q7 | Economic efficiency is achieved in the long run in the case of

perfect competition

monopoly

monopolistic competition

oligopoly

Q8 | Consumer surplus will be maximum in the case of

perfect competition

monopoly

monopolistic competition

oligopoly

Q9 | At the optimum short-run level of output, the firm will be

maximizing total profit

minimizing total losses

either maximizing total profit or minimizing total losses

maximizing profit per unit

Q10 | The short-run supply curve of a perfectly competitive firm is given by

rising portion of the mc curve over and above the shut-down point

rising portion of the mc curve over and above the break-even point

rising portion of the mc curve over and above the ac curve

rising portion of the mc curve

Q11 | When the perfectly competitive firm and industry are both in longrun equilibrium

p = mr = smc = lmc

p = mr = sac = lac

p = mr =lowest point on the lac curve

all of the above

Q12 | Monopolistic competition is characterized by

few firms’ selling differentiated products

many firms selling homogeneous product

few firms selling homogeneous product

many firms selling differentiated products

Q13 | The theory of monopolistic competition was popularized by

marshall

keynes

chamberlin

pigou

Q14 | A monopolistically competitive market is distinguished from perfectcompetition by the fact that

few sellers

it has few buyers

it deals with differentiated products

none of the above

Q15 | Excess capacity is a hallmark of

perfect competition

monopoly

oligopoly

monopolistic competition

Q16 | Monopolistically competitive firms

are small in size

have small share in the market

are large in the size

both a and b

Q17 | Selling cost assumes paramount importance in

perfect competition

monopoly

monopolistic competition

none of the above

Q18 | Under monopolistic competition, there can be freedom of entry inthe sense that there is freedom to produce

close substitutes

perfect substitutes

complements

none of the above

Q19 | A firm under monopolistic competition advertise because

to compete successfully with rival

to lower cost of production

to increase revenue and sales

since it cannot raise price

Q20 | In the case of monopolistic competition,

short run supply curve cannot be defined

mr curve cannot be defined

ar curve cannot be defined

none of the above

Q21 | Under monopolistic competition, super normal profit arise when

ar=ac

mr=mc

ar>ac

ar

Q22 | Which of the following condition are met in the long run equilibriumof the monopolistic competitor earning only normal profit

mc=ac

p=ac

p=mr

p=mc

Q23 | The term group equilibrium is referred to

duopoly

monopolistic competition

perfect competition

oligopoly

Q24 | Increase or decrease in the level of production by a monopolistically competitive firm have ------- impact on price and output decisionsof other firms

very significant

significant

small

negligible

Q25 | Monopolistic competitive firm fixes the price of its product

independent of the price of close substitutes

close to the prices of close substitutes

at a very high level

none of the above