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4

If the price of product increases and in the result the demand for product B also increases then:

A. A and B are substitute goods

B. A and B are complementary goods

C. A is inferior to B

D. A is superior to B

Correct Answer :

A. A and B are substitute goods


Related Questions

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4

The MRTS along an iso-quant goes on to:

A. Appear

B. Diminish

C. Prominent

D. Increase

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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

The cost of firms in cournot model are:

A. identical

B. differential

C. very high

D. very low

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4

The game theory concentrates on:

A. Gaming

B. Strategic decisions

C. Both a and b

D. None of the above

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4

According to Cobb-Douglas, in production function the marginal product of labor is:

A.

B.

C.

D.

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4

If production increases under increasing returns to scale, the cost will:

A. Increase at decreasing rate

B. Increase at constant rate

C. Decrease at increasing rate

D. Increase at increasing rate

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4

Under monopolistic competition, the products sold by the firms are:

A. Economic substitutes

B. Technical substitutes

C. Both a and b

D. None of the above

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4

At final equilibrium in cournot model, each firm sells:

A. 1/2 of the total market demand

B. 1/4 of the total market demand

C. 1/3 of the total market demand

D. None of the above

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4

The demand of the luxuries is:

A. More elastic

B. Less elastic

C. Unit elastic

D. Zero elastic

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4

If a monopolist is producing under decreasing cost conditions, increase in demand is beneficial to the society because:

A. Consumers get better quality goods

B. Cost of production falls and hence price will follow

C. Goods will be sold in many markets

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

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

Loanable funds theory of Interest was developed by:

A. Wicksell

B. Robert San

C. Ruskin

D. J.B.Say

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4

The firm producing at the minimum point of the AC curve is said to be:

A. Operating under diminishing cost

B. Making optimum use of plant capacity

C. Operating at excess capacity

D. Operating under increasing costs

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4

The indifference curve technique:

A. Helps in separating the income effect and the substitution effect

B. Does not help in separating the two effects

C. Mixed up the two effects

D. None of the above

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4

The law of demand is most directly a result of:

A. The law of comparative advantage

B. The law of diminishing returns

C. The principle of substitution

D. Economics of large scale production

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4

In monopolistic competition (also in kinked demand curve model), a firm sells the amount where:

A. Individual demand curve (IDC) is equal to proportional demand curve (PDC)

B. Individual demand curve (IDC) is greater than proportional demand curve (PDC)

C. Individual demand curve (IDC) is less than proportional demand curve (PDC)

D. None of the above

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4

The slope of isocost line (budget line) shows:

A. Capital labor ratio

B. Labor wage ratio

C. Factor price ratio

D. Factor labor ratio

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Which of the following is assumed to be constant when drawing a demand curve?

A. Consumer tastes

B. Prices of inputs

C. Technology

D. Number of sellers

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4

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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4

If the commodity is inferior then the Income Effect (I.E) and the Substitution Effect (S.E):

A. Both move together and reinforce each other

B. One moves and the other remains constant

C. Move in the opposite direction and neutralize each other

D. Both remain constant

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4

Micro economics is concerned with:

A. Product markets

B. Factor markets

C. Supply and demand

D. a, b and c

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4

If the supply curve is not a straight line but curvilinear, the elasticity on all points of the supply curve is:

A. Equal

B. Different

C. Zero

D. Infinity

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4

The short run cost curve is U shaped because of:

A. The operation of increasing cost

B. The existence of fixed cost

C. The existence of variable cost

D. All of the above

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4

Identify the factor, which generally keeps the price elasticity of demand for a commodity low:

A. Variety of uses for that commodity

B. Its low price

C. Close substitutes for that commodity

D. High proportion of the consumers income spent on it

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4

Moving along an indifference curve leaves the consumer:

A. Better off

B. Worse off

C. Neither better nor worse off

D. None of the above

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4

The Tit for Tat strategy means cooperation by the 2nd firm if:

A. 1st firm does not cooperate

B. 1st firm cooperates

C. 1st firm collapses

D. None of the above

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4

Which of the following theories of trade cycle was presented by William Jevons?

A. Sunspot Theory

B. Monetary Theory

C. Saving-Investment Theory

D. Innovation Theory

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4

In monopolistic competition, the firm take advantage due to customers:

A. Similar choices

B. Unlimited choices

C. Differential choices

D. Few choices

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4

When AC curve falls, MC curve falls:

A. More than AC curve

B. Less than AC curve

C. Equal to AC curve

D. None of the above