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4

If the commodity is inferior then:

A. Income effect is positive but substitution effect is negative

B. Income effect is negative but substitution effect is positive

C. Both income effect and substitution effect are negative

D. Both income effect and substitution effect are positive

Correct Answer :

C. Both income effect and substitution effect are negative


Related Questions

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4

Who wrote Mathematical Analysis for Economists?

A. J.P.Lewis

B. R.G.D.Allen

C. Paul A.Samuelson

D. E.D.Domar

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4

The situation in between the extremes of the govt. controlled, planned economy and the perfectly free, unplanned economy is known as:

A. Developed economy

B. Laissez-fair economy

C. Mixed economy

D. Capitalistic economy

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4

For the equilibrium of the firm and the industry in the short period in a competitive market, the condition is:

A. P = AC

B. P = MC

C. AC = MC

D. MC = TR

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

A. Negative

B. Positive

C. Infinite

D. Zero

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The optimum level of output in long run takes place where:

A. LAC = LMC

B. SAC = LMC

C. SAC =MC

D. SAC =LAC

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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

Which of the following formula determine the income elasticity of demand?:

A. Proportionate change in demand Proportionate change in price

B. Proportional change in the purchase of Y Proportional change in the price of X

C. Proportionate change in demand Proportionate change in income

D. Proportionate change in demand Proportionate change in price

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4

MC = MR = AC = AR shows the long run equilibrium position of the:

A. Competitive firm

B. Oligopolistic firm

C. Monopolist firm

D. None of the above

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4

At the point where a straight line demand curve meets the quantity axis (x-axis), elasticity of demand is:

A. Equal to zero

B. Equal to one

C. Equal to infinite

D. More than one

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4

According to Saint Thomas Aquinas value is determined by God, but prices by:

A. Consumers

B. Employees

C. People

D. Labor

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4

If two households have identical preferences but different incomes then:

A. They must consume the same amounts of all goods

B. The wealthier one will have lower marginal utility for most goods

C. The wealthier one will have higher marginal utility for most goods

D. They will enjoy the same level of utility

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4

In respect of which of the following category of goods is consumers surplus highest?

A. Giffen goods

B. Necessities

C. Luxuries

D. Prestige goods

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4

Repetition of a game (Repeated Game):

A. Yields the same outcome over and over

B. Can result in behavior that is different from what it would be if the game were played once

C. Is not possible

D. Makes cooperative games into noncooperative games

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4

Total variable costs in equation form are:

A.

B.

C.

D.

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4

The main contribution of Malthus is in the field of:

A. Consumption expenditure

B. Theory of population

C. Division of labor

D. Theory of demand

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4

In Nash Equilibrium:

A. Each player has a dominant strategy

B. No players have a dominant strategy

C. At least one player has a dominant strategy

D. Players may or may not have dominant strategies

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4

Which of the following is called Gossens first law?

A. Law of production

B. The Law of Equi-Marginal Utility

C. The Law of Diminishing Marginal Utility

D. Law of Variable Proportions

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4

Consumer surplus is the difference between

A. Price demanded and price paid

B. Price quoted and price actually paid

C. Price that a consumer is willing to pay and the price actually paid

D. None of the above

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4

Ordinal approach includes arranging:

A. The different combinations of X and Y in any way the consumer wants

B. The different combinations of X and Y higher and lower and measuring the difference of utility between them

C. The different combinations of X and Y higher and lower and not measuring the difference of utility between them

D. None of above

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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

In case of complementary factors, the isoquants are:

A. L-shaped

B. J-shaped

C. M-shaped

D. V-shaped

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4

A monopolist:

A. Can not influence the market

B. Can influence the market

C. Is a price taker

D. None of the above

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4

Which of the following would be least likely to cause a consumer to eat less beef?

A. An increase in the price of beef

B. An increase in the price of lamb

C. A reduction in the consumers income

D. A reduction in the price of lamb

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4

Which of the following conditions is met in the long-run equilibrium in monopolistic competition, where the firm is earning only normal profits?

A. MC =AC and P

B. MC = AC and P=MR

C. P =MC and P

D. MC=MR and P =AR= ATC

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4

Who is the author of the famous work Asian Drama: An Enquiry intro the Causes of Poverty of Nations?

A. Irving Fisher

B. J.B.Clark

C. J.M.Keynes

D. Gunnar Myrdal

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In case of monopoly, when total revenue is maximum:

A. MR is positive

B. MR falls

C. MR rises

D. MR is zero

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4

If X and Y are close substitutes, a fall in price of X will lead to:

A. Increase in demand for Y

B. Decrease in demand for Y

C. Increase in demand for both X and Y

D. Increase in demand for Y

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4

In perfect cartel, the:

A. Perfect competition price is charged

B. Monopoly price is charged

C. Monopoly price is not charged

D. None 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

The products, under monopolistic competition are differentiated, yet they are:

A. Complements

B. Close substitutes

C. Both a and b

D. None of the above