Contraction of demand means:
Less quantity demanded at the same price
Less quantity demanded at a higher price
Less quantity demanded at a lower price
None of the above
Correct Answer :
B. Less quantity demanded at a higher price
Related Questions
The total utility (TU) curve is:
Concave to X-axis
Convex to X-axis
Concave to Y-axis
Convex to Y-axis
The general markets results from the imposition of price ceilings has been:
Higher prices
Increased prices
Increased consumption
Shortage of products
The number of firms in monopolistic competition normally range between:
14 to 28
14 to 80
14 to 38
14 to 60
The cost of production is faced by a:
Producer
Consumer
Seller
Firm
From analysis, it is clear that both Marshal and Walras market models are:
Unstable
Stable
Variable
Fluctuating
Regarding economic decisions, economics of uncertainty identifies:
No risks
Risks
Safety
None of the above
The isoquant approach is:
Classical approach
Keynesian approach
Neo-classical approach
Modern approach
Increasing returns imply:
Constant average cost
Diminishing cost per unit of output
Optimum use of capital and factor
External economies
In real life firms:
Loss because of past
Learn from past
Destroy because of past
None of the above
The difference between average total cost and average fixed cost shows:
Normal profits
Implicit costs
Variable costs
Opportunity costs
The study of economics just in theoretical way is called:
Positive Economics
Normative Economics
Micro Economics
Development Economics
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
For the equilibrium of the firm and the industry in the short period in a competitive market, the condition is:
P = AC
P = MC
AC = MC
MC = TR
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
The imaginary differentiation is attributed to difference in:
Style
Salesmanship
Locality
All of these
The firm producing at the minimum point of the AC curve is said to be:
Operating under diminishing cost
Making optimum use of plant capacity
Operating at excess capacity
Operating under increasing costs
In sweezy model (kinked demand curve model), the role of MC curve:
Can be ignored
Cannot be ignored
Partially be ignored
None of the above
According to Marshallian approach, utility:
Can be added
Can be subtracted
Can be multiplied
Can be divided
Demand of a commodity is elastic when:
Change in its price causes a proportionately greater change in its quantity demanded
Change in its price does not change its quantity demanded
Change in consumers income causes change in demand
None of the above
The products, under monopolistic competition are differentiated, yet they are:
Complements
Close substitutes
Both a and b
None of the above
The model which gives us information about price and output changes in different periods is:
Stable cobweb model
Perpetual oscillation
Both(a) and(b)
None of them
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
In the case of a giffen good, the income effect:
Is equal to the substitution effect
More than offsets the substitution effect
Reinforces the substitution effect
Only partially offsets the substitution effect
The standard form of demand function is:
Q = a- bP
Y = a- bP
Q = a+ bP
If production increases under increasing returns to scale, the cost will:
Increase at decreasing rate
Increase at constant rate
Decrease at increasing rate
Increase at increasing rate
The slutsky demand curve includes:
Income effect
Price effect
Substitution effect
None of the above
The main contribution of Prof. R.G.D.Allen is in the field of:
fixation of price
Arc elasticity of demand
Cross elasticity of demand
Wage theory
If a new production technology for producing compact discs is developed and new firms are attracted to this field:
The supply curve will shift down or right
The supply curve will shift up or left
Both demand and supply curve shifts would occur
None of the above
In perfect cartel, the:
Perfect competition price is charged
Monopoly price is charged
Monopoly price is not charged
None of the above
The marginal revenues are derivatives of:
TR function
AR function
MR function
AP function