Basics of Economics MCQ Question with Answer

Basics of Economics MCQ with detailed explanation for interview, entrance and competitive exams. Explanation are given for understanding.

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Question No : 15
In the immediate run:

Supply curves are inelastic
Supply curves are perfectly elastic
Demand curves are elastic
Supply curves are elastic

Question No : 16
The difference between accounting profits and economic profits is:

Implicit costs
Explicit costs
Fixed costs
Variable costs

Question No : 17
Increase in demand occurs when:

The price falls and the demand also falls down
The price increases but demand falls down
The price increases the demand remains constant and when the price remains constant the demand goes up
The price remains constant but demand falls

Question No : 18
In modern cost theory, AVC= b1 and MC= b1 in the range of:

Excess capacity
Reserve capacity
Limited capacity
None of the above

Question No : 19
In monopolistic competition, the firm compete on the basis of:

Both a and b
None of the above

Question No : 20
If as a result of an increase in prices, total outlay (expenditures) on a commodity decreases, its price-elasticity of demand is:

Perfect elastic (infinitely elastic)
Relatively elastic (greater than one elasticity)
Unit elastic
Relatively inelastic (less than one elasticity)

Question No : 21
The marginal revenues are derivatives of:

TR function
AR function
MR function
AP function