An optimum level of a firms output is:
Where marginal cost is minimum
Where average cost is minimum
Where both the marginal and the average cost curves are at their respective minimum
Where the firm earns the maximum profits
Correct Answer :
B. Where average cost is minimum
Related Questions
A significant property of the Cobb-Douglas production function is that the elasticity of substitution between inputs is:
Greater than one
Less than one
Zero
Equal to one
The factors of production in perfect competition are:
Stagnant
Mobile
Immobile
Rare
Under monopolistic competition, the firms compete alongwith:
Supreme powers
Discretionary powers
Low powers
None of the above
Normal profits are considered as:
Explicit costs
Implicit costs
Social costs
Private cost
If the consumers expect that the price of computers will decrease in next year then:
Current demand for computers will fall
Current demand for computers will rise
Current demand will change unpredictably
Current supply of computers will rise
A fall in demand for the product under monopolistic competition will likely result in:
A fall in price
A decrease in the number of firms in the long-run
A decrease in the output of each firm
All of the above
Because the price elasticity of demand for OPEC oil is approximately .08, in order to increase revenues OPEC should:
Lower price in order to increase revenues
Lower price in order to decrease the amount of oil sold
Rise price in order to increase the amount of oil sold
Raise price in order to increase revenues
An optimum level of a firms output is:
Where marginal cost is minimum
Where average cost is minimum
Where both the marginal and the average cost curves are at their respective minimum
Where the firm earns the maximum profits
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
Law of Variable Proportions is regarding in:
Short-Run
Long-Run
Medium-Run
None of the above
At low prices, demand is likely to be:
More elastic
Less elastic
Unit elastic
Perfectly inelastic
Which of the following does not have a uniform elasticity of demand at all points?
A vertical demand curve
A horizontal demand curve
A rectangular hyperbola demand curve
A downward sloping demand curve
In real life, brand loyalty is a barrier to:
Enter the new firms
Exit the new firms
Both a and b
None of the above
Marshallian demand function is also known as:
Utility demand function
Compensated demand function
Collective demand function
Relative demand function
Any straight line supply which cuts the x-axis will have:
Zero elasticity
An elasticity greater than one
Unitary elasticity of supply
An elasticity less than one
Elasticity of demand is equal to unity while marginal revenue is:
Positive
Zero
Negative
Indeterminate
Price elasticity of demand is best defines as:
Change in the tastes of consumers at different prices
The rate of response of demand to a change in supply
The change in costs when output is increased by one unit
The responsiveness of demand to a change in price
Change in demand (rise and fall of demand) is:
Due to change in price while other factors remain constant
Due to change in factors other than price
Both a and b
None of the above
The imaginary differentiation is attributed to difference in:
Style
Salesmanship
Locality
All of these
In monopolistic competition (also in kinked demand curve model), a firm sells the amount where:
Individual demand curve (IDC) is equal to proportional demand curve (PDC)
Individual demand curve (IDC) is greater than proportional demand curve (PDC)
Individual demand curve (IDC) is less than proportional demand curve (PDC)
None of the above
The slope of marshallian demand curve is:
Upward
Vertical
Downward
Horizontal
Change in quantity demanded (expansion and contraction of demand) is:
Due to change in price while other factors remain constant
Due to change in factors other than price
Both a and b
None of the above
In substitution effect and income effect:
The substitution effect is more certain
The income effect is more certain
The substitution effect is uncertain
The income effect is always positive
The Lambda or Langrange Multiplier is a:
Analyst
Catalyst
Pessimist
Optimist
The number of firms in monopolistic competition normally range between:
14 to 28
14 to 80
14 to 38
14 to 60
Labor Saving Technological Progress can be defined as:
Technological progress that causes to raise the marginal product of capital and labor in the same proportion
Technological progress that causes the marginal product of capital to increase relative to the marginal product of labor
Technological progress that causes the marginal product of labor to increase relative to the marginal product of capital
None of the above
Microeconomics deals with the:
Allocation of resources of the economy as between production of different goods and services
Determination of prices of goods and services
Behavior of industrial decision makers
All of the above
If a straight line supply curve makes an intercept on the X-axis, the elasticity of supply is:
Equal to unity
Less than unity
More than unity
Zero
In the long run:
All factors can be used in different proportions
Management can be re-organized
A firm can experience returns to scale
All of the above
Which form of market structure is characterized by interdependence in decision-making as between the different competing firms?
Oligopoly
Perfect competition
Imperfect competition
None of the above