A firm under perfect competition has:
An AR curve which is a horizontal straight line
An AR curve which slopes downward
An AR curve which has a kink
An AR curve shape of which cannot be predicted
Correct Answer :
A. An AR curve which is a horizontal straight line
Related Questions
In case of monopoly, the slope of MR is:
Always three times than the slope of AR
Always double than the slope of AR
Always equal to the slope of AR
None of the above
Under monopoly and imperfect competition MC is:
More than the price
Less than the price
Equal to the price
Less than or equal to the price
The pay-off matrix shows:
Possible outcomes
Possible benefits
Possible losses
None of them
Income-demand curve shows:
Income-expenditure relationship
Income-cost relationship
Income-price relationship
Income-quantity relationship
Micro economics is concerned with:
Product markets
Factor markets
Supply and demand
a, b and c
Demand for a commodity is elastic when it has
Only one use
Many uses
Uses which cannot be postponed
Uses very essential for the consumer
The Purchasing Power Parity (PPP) Theory is presented by:
J.M.Keynes
E.D.Domar
Adam Smith
Gustav Cassel
When elasticity of demand is greater than one (e >1), then following the formula MR=P[1-1/e], the MR will:
Positive
Negative
Zero
None of the above
Income effect operates through an increase
In nominal income
In money income
In wages
In real income because of the fall of price of a commodity
Traditionally, the study of determination of price is called:
Theory of price
Theory of value
Theory of labor
Theory of cost
If at the unchanged price, the demand for a commodity goes up, or the quantity demanded remains the same when its price goes up, it is called:
Contraction of demand
Decrease in demand
Increase in demand
Extension of demand
When marginal costs curve cuts average costs curve, average costs are:
Maximum
Zero
Minimum
Equal to one
Which of the following formula determine the income elasticity of demand?:
Proportionate change in demand Proportionate change in price
Proportional change in the purchase of Y Proportional change in the price of X
Proportionate change in demand Proportionate change in income
Proportionate change in demand Proportionate change in price
In joint-profit maximization cartel, the distribution of profit is:
Made by agency
Not made by agency
Made by people
None of the above
With an increase in income, consumer is expected to buy more of:
An inferior good
A giffen good
A normal(or superior) good
None of the above
The reaction curve of a firm is attained by joining the:
Isoprofit curve
Super profit curve
Normal profit curve
Indoprofit curve
When the consumer is in equilibrium not only his income is fully spent, but the ratio of marginal utility and price is:
Increased
Equalized
Prominent
Zero
The main objective of the firm is to:
Face losses
Avoid losses
Bear losses
Make economic decisions
Efficient allocation of resources is likely to be achieved under:
Monopoly
Monopolistic competition
Perfect competition
Any market form
If the demand curve is inelastic then:
It may be nearly vertical
Quantity demanded is very sensitive to income
Demand is hardly affected by income
Close substitutes for the good are abundant
The ordinary demand curve is also called:
Marshallian demand curve
Hicksian demand curve
Slutsky demand curve
All the above
The addition or increment to the total cost involvesd in expanding or contracting output by one unit is called:
Fixed cost per unit
Variable cost per unit
Total cost per unit
Marginal cost
The elliptical isoquant represents the:
Economic combinations of labor and capital
Uneconomic combinations of labor and capital
Both a and b
None of the above
Cross-demand curve shows:
The effect of a change in price of X on its demand
The effect of a change in price of X on the demand for Y
The effect of a change in price of Y on its demand
None of the above
Price mechanism has also given the name:
Labor theory
Production theory
Laisseze-faire
None of the above
To attain maximum profits during short-run a firm should produce the output that will:
Yield maximum total revenue
Minimize marginal cost
Maximize marginal cost
Equate marginal revenue with marginal cost
A demand curve is not related to:
The price of the commodity
The time period
The price of substitutes
Any of the above
The budget-line is also known as the:
Iso-utility curve
Production possibility line
Isoquant
Consumption possibility line
External economies are witnessed in:
A rising supply curve
A rising demand curve
A falling supply curve
A falling demand curve
A mixed economy is characterized by the coexistence of:
Modern and traditional industries
Public and private sectors
Foreign and domestic investments
Commercial and subsistence farming