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4

Each short run average cost curve:

A. Has to touch the long run cost curve

B. Has to cross the long run cost curve

C. Has to lie above all points on the long run cost curve

D. Coincides with the long run cost curve at some point

Correct Answer :

D. Coincides with the long run cost curve at some point


Related Questions

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4

In Bertrand model, the entry of new firms is:

A. banned

B. allowed

C. partially allowed

D. none of the above

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4

The competitive equilibrium leads to:

A. The firms producing with excess capacity

B. The firms producing at their minimum costs

C. Firms producing at a cost higher than the minimum

D. Some firms producing under decreasing costs and others under increasing costs

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4

An inferior good/ commodity is inferior for:

A. Every consumer

B. Most consumers

C. All consumers

D. Some consumers and not for others

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4

The demand curve slopes downwards due to:

A. Income effect(I.E)

B. Substitution effect(S.E)

C. Taste effect

D. Both a and b

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4

Economics is a:

A. Exact science

B. Inexact science

C. Pure science

D. All of the above

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4

When elasticity of demand is less than one (e<1), then following the formula MR=P[1-1/e], the MR will:

A. Positive

B. Negative

C. Zero

D. None of the above

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4

In second degree price discrimination, monopolist takes away :

A. All of the consumer surplus

B. All of the producer surplus

C. Some part of the consumer surplus

D. None of them

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4

Supply curves are most elastic:

A. In the long-run

B. In the short-run

C. For luxuries

D. In the immediate-run

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4

The point on which the average cost is minimum in a firm, short run average cost curve will also be the minimum cost point on the firms long-run average cost curve. This is true:

A. Always

B. Never

C. When LAC is falling

D. Only at that level of output when LAC is at its minimum

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4

Most of the supply curves with which the average consumer deals are:

A. Vertical

B. Horizontal

C. Controlled by the largest producers

D. Unaffected by inflation

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4

All money costs can be regarded as:

A. Social costs

B. Opportunity costs

C. Explicit costs

D. Implicit costs

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4

Other things remaining the same, when a consumers income increases his equilibrium point moves to:

A. A lower indifference curve

B. A lower PPC curve

C. Remains on same indifference curve

D. A higher indifference curve

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4

Which of the following is not characteristic of perfect competition?

A. Freedom of entry and exit

B. Each seller is a price taker

C. Perfect information about prices

D. Heterogeneous products

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4

Under the law of variable proportions, the average and the marginal product of the variable factor would ultimately:

A. Become equal

B. Decrease

C. Become constant

D. Increase

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4

The main contribution of David Ricardo is in the field of:

A. Wages of labor

B. Factor pricing

C. Theory of rent

D. Determination of the rate of interest

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4

A monopolist is able to maximize his profit when:

A. His output is maximum

B. He charges a high price

C. His average cost is minimum

D. His marginal revenue is equal to marginal cost

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4

J.R.Hicks was:

A. Neo-classical economist

B. Classical economist

C. Keynesian economist

D. Post-Keynesian economist

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4

Under perfect competition, the average revenue, marginal revenue and price are shown:

A. By a same single curve

B. By three different curves

C. By downward sloping curve

D. None of the above

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4

In the case of superior (normal) commodity, the income elasticity of demand is:

A. Positive

B. Unitary

C. Negative

D. Infinite

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4

The critics of Sweezy model say that kink generates:

A. Frustration

B. Poverty

C. Uncertainty

D. Integrity

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4

Which is the other name that is given to the average revenue curve?

A. Profit curve

B. Demand curve

C. Average cost curve

D. Indifference curve

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4

In joint-profit maximization cartel, the distribution of profit is:

A. Made by agency

B. Not made by agency

C. Made by people

D. None of the above

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4

Demand of a commodity is elastic when:

A. Change in its price causes a proportionately greater change in its quantity demanded

B. Change in its price does not change its quantity demanded

C. Change in consumers income causes change in demand

D. None of the above

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4

The factors of production in perfect competition are:

A. Stagnant

B. Mobile

C. Immobile

D. Rare

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4

In case of straight-line isoquant, the factors are not substituted because they are each others:

A. Imperfect substitutes

B. Perfect substitutes

C. Complements

D. None of the above

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4

Karl Marx:

A. Led the Russian Revolution

B. Provided the theoretical basis for socialism(communism)

C. Developed his theory in response to the Great Depression of the 1930s

D. None of the above

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4

The addition or increment to the total cost involvesd in expanding or contracting output by one unit is called:

A. Fixed cost per unit

B. Variable cost per unit

C. Total cost per unit

D. Marginal cost

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4

Of the following commodities, which has the lowest price-elasticity of demand?

A. Car

B. Salt

C. Tea

D. House

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4

With which of the following concepts is the name of J.M.Keynes particularly associated?

A. Marginal propensity to consume

B. Marginal propensity to save

C. Liquidity preference

D. All of the above

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4

Cross-elasticity of demand or cross-price elasticity between two substitutes will be:

A. Negative

B. Positive

C. Infinite

D. Zero