Identify the coefficient of price-elasticity of demand when the percentage increase in the quantity of a commodity demanded is smaller than the percentage fall in its price:
Equal to one
Greater than one
Smaller than one
Zero
Correct Answer :
C. Smaller than one
Related Questions
Along an isoquant, output remains same, and capital labor ratio:
Is also same
Is different
Is constant
Is zero
In Bertrand model, the entry of new firms is:
banned
allowed
partially allowed
none of the above
When was Adam Smiths major work An Enquiry into the Nature and Causes of Wealth of Nations published?
1756
1777
1776
1801
A budget line shows:
Price of commodity X in terms of Y
Price of commodity Y in term of X
Income of the consumer
All of the above
The elasticity of demand is equal to slope of demand function divided by:
Average demand function
Qualified demand function
Constructive demand function
Relative demand function
The competitive equilibrium leads to:
The firms producing with excess capacity
The firms producing at their minimum costs
Firms producing at a cost higher than the minimum
Some firms producing under decreasing costs and others under increasing costs
When the slope of a demand curve is zero (also known as vertical demand curve) then elasticity will be:
Zero (perfectly inelastic)
Equal to one (unitary elastic)
Infinite (perfectly elastic)
None 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
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
In short run, a firm can change its:
Total production
Fixed production
Variable production
None of the above
The isoquant approach is based upon:
One output
One input
Two outputs
Two inputs
If two goods are perfect substitutes then IC will be:
Concave to the origin
Convex to the origin
Positively sloped
Negatively sloped
7.In an economy based on the price system the decision on what shall be produced is made by:
Government
Consumer
Producer
Stock holder
The long-run average cost is based on the fact that:
None of the factors are variable in the long-run
All factors are perfectly divisible in the long-run
None of the factors is divisible
Management factor is indivisible while all other factors are divisible and can be varied in long-run
In the long-run competitive equilibrium, the theory predicts that:
TC = TR and MC = MR
Firms operate at a minimum average total cost
There is no incentive for entry or exit of firms
All these conditions exist
Marginal utility equals:
Slope of total utility curve
Slope of average utility curve
Slope of marginal utility curve
Slope of total revenue curve
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
One common definition of a luxury good is a good with income elasticity:
Greater than one
Equal to one
Less than one but more than zero
None of the above
If production increases under constant returns to scale, the cost will:
Increase at a constant rate
Decrease at a constant rate
Increase at a variable rate
Decrease at a variable rate
The critics of Sweezy model say that kink generates:
Frustration
Poverty
Uncertainty
Integrity
Economic problems arise because:
Wants are unlimited
Resources are scarce
Scarce resources have alternative uses
All of the above
Extension (expansion) of demand means:
More quantity demanded at a lower price
More quantity demanded at a higher price
More quantity demanded at the same price
None of the above
The marginal revenue of a perfectly competitive firm is:
Equal to the prices of its products
Positively related to output
Negatively related to output
Always higher than marginal cost
Identify the economist who first developed the theory of income determination in its modern form:
Paul A.Samuelson
J.M.Keynes
Joan Robinson
Dr.mehboob ul Haq
At a point where a straight line demand curve meets the price axis (Y-axis), the elasticity of demand is:
Equal to one
Less than one
Equal to zero
Equal to infinite
Airlines that try to lower fares in order to increase revenues believe that demand for airline services is:
Price elastic
Price inelastic
Income elastic
Income inelastic
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
In non-constant sum game (non-zero sum game), if there are two parties then:
Both parties make better-off
Both parties make worse-off
Both parties become Neutral
Both parties can become better off or worse off
In the case where two commodities are good substitutes then cross elasticity will be:
Positive
Unitary
Negative
Infinite
Money spent by a firm on the purchase of capital equipment is:
Fixed cost
Variable cost
Both fixed and variable costs
None of the above