Elasticity of Substitution (s) is defined as:
Percentage change in capital-labor ratio dividing by percentage change in 
Percentage change in dividing by percentage change in capital-labor ratio
Percentage change in inputs dividing by percentage change in outputs
None of the above
Correct Answer :
A. Percentage change in capital-labor ratio dividing by percentage change in
Elasticity of Substitution (s) = %? (K/L) / %?
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Related Questions
Quantity demanded or supplied is measured in:
Monetary units
Physical units
Relative units
Constant units
Contraction in demand occurs when:
Price increases and demand decreases
Price increases but demand also increases
Price remains constant but demand falls down
Price falls down but demand remains constant
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
In cournot model, at equuilibrium when MC = MR, the elasticity of demand is:
equal to one
zero
negative
equal to 2
In Nash equilibrium, a player:
Deviates from his strategy
Does not deviate from his strategy
Does not think in a good way
None of the above
The firm is at equilibrium where:
Output is maximum
Profit is maximum
Revenues are maximum
Profit is minimum
Formulation of an economic theory involves:
Statements of various assumptions or postulates
Logical deductions from the assumptions made
Testing the hypothesis against empirical evidence
All of the above
In the theory of firm, Chamberline presented the idea of:
Rising cost
Falling cost
Rising input
Falling input
According to law of Equi-Marginal Utility when price of commodity falls then we bought:
More units
Less units
Same units
Zero units
An increase in the price of the good measured on the horizontal axis causes:
The budget line to get steeper
The budget line to shift parallel to the right
The indifference curve to shift up
The budget line to get flatter
The main contribution of Adam Smith is in the field of:
Economics of state
Wealth of Nations
Value and price
Theory of demand
Marginal utility means:
Utility derived from the last unit of production
Utility derived from the last unit of a commodity which is being consumed
Total utility- Average utility
None of the above
In the immediate run:
Supply curves are inelastic
Supply curves are perfectly elastic
Demand curves are elastic
Supply curves are elastic
Indifference curves reflect:
Preferences
Income
Prices
Consumption
We can find total utility by:
Multiplying the number of unit by its marginal utility
Adding up the marginal utility of all units
Multiplying price by number of units
None of the above
In income effect, we:
Move to another indifference curve
Move along given indifference curve
Move to lower indifference curve
Move to upper indifference curve
The fixed cost of a firm:
Are fixed even in the long period
When expressed as an average, show a continuous decline with increase of output
Do not reflect diminishing marginal returns
None of the above
In modern theory of costs, a firm normally utilizes:
2/3 of capacity of its plants
3/4 of capacity of its plants
1/3 of capacity of its plants
1/2 of capacity of its plants
The name of the system of direct exchange is:
Price system
Barter system
Islamic economic system
Socialistic system
We can obtain consumers demand curve from:
Income Consumption Curve (ICC)
Engels Curve
Price Consumption Curve (PCC)
Production Possibility Curve (PPC)
In context of oligopoly, the kinky demand curve (kinked demand curve) hypothesis is designed to explain:
Price and output determination
Price rigidity (price stickness)
Price leadership
Collusion among rivals
In case of giffin good, price effect is:
Positive
Negative
Neutral
Infinite
The cost curves of the firm shift due to changes in:
Input prices
Technological innovations
Both of them
None of them
When was Adam Smiths major work An Enquiry into the Nature and Causes of Wealth of Nations published?
1756
1777
1776
1801
When the income of consumer increases then budget line will:
Get steeper
Shift parallel to right
To get flatter
To shift upward
According to translog production function, elasticity of substitution is:
Greater than one
Less than one
Zero
Equal to one
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
In Revealed Preference Theory, a consumer reveals preference for bundle of:
Two goods
A few goods
One good
Many goods
In discriminating monopoly (price discrimination), the cost of production in two markets are:
Different
Same
Zero
None of the above
The arc elasticity is the measure of average elasticity at the mid-point of the chord and connects:
Two points on demand curve
Two points on supply curve
Many points on demand curve
Many points on demand curve