In case the two commodities are complements, cross elasticity will be:
Positive
Unitary
Negative
Infinite
Correct Answer :
C. Negative
Related Questions
If production increases under increasing returns to scale, the cost will:
Increase at decreasing rate
Increase at constant rate
Decrease at increasing rate
Increase at increasing rate
In the real world, some competitive firms owns specialized resources that earn a return called:
Economic profit
Rent
Accounting profit
Normal profit
The Hicksian indirect utility function in the form of equation is:
x =f(P)
x =a-bp
If the price of a product falls then quantity demanded tends to increase ceteris paribus because:
The MU/P ratio has decreased
Of the income and substitution effects
Consumers tend to feel poorer when prices fall
When price falls the demand curve shifts right
Discriminating monopoly implies that the monopolist charges different prices for his commodity:
From different groups of consumers
For different uses
At different places
Any of the above
Cross-elasticity of demand or cross-price elasticity between two independent goods will be:
Negative
Positive
Infinite
Zero
If the production increases under decreasing returns to scale, the cost will:
Increase at decreasing rate
Increase at constant rate
Decrease at increasing rate
Increase at increasing rate
Which is the first-order condition for the profit of a firm to be maximum?
AC=MR
MC=MR
MR=AR
AC=AR
In 1776, a famous book An enquiry into the nature and causes of the wealth of nation was written by:
J.S.Mill
Adam Smith
Robert Malthus
David Ricardo
If the commodity is inferior then the increase in income of the consumer results in:
More purchase
Less purchase
Same purchase
None of the above
A maximin strategy:
Maximizes the minimum gain that can be earned
Maximizes the gain of one player, but minimizes the gain of the opponent
Minimizes the maximum gain that can be earned
None of the above
In cournot model, firms sell:
Superior goods
Inferior goods
Identical goods
Differential goods
A price is a ratio of exchange between:
Money and exchange
Quantity and production
Production and consumption
Money and quantity
The demand of the luxuries is:
More elastic
Less elastic
Unit elastic
Zero elastic
Traditionally, the study of determination of price is called:
Theory of price
Theory of value
Theory of labor
Theory of cost
Plumbing and pipe-fitting require many of the same skills. If the wage paid to pipe-fitters increased then the effect on the market for plumbers would probably be:
An increase in demand
A decrease in demand
An increase in supply
A decrease in supply
In monopolistic competition, the cost curves of all firms are:
Uniform
Different
Dependent
Independent
When at a given price, the quantity demanded of a commodity is more than the quantity supplied, there will be:
An upward pressure on price
A downward pressure on price
Price will remain unaffected
All of the above
For the given production function, technical efficiency is defined as:
Sets of points relating production function that maximizes output given input (labor) i.e. Q = f(L, K)
Sets of points relating production function that produces less output than possible for a given set of input (labor) i.e. Q < f(L, K)
Use of imported technology
None of the above
Price discrimination is possible:
When elasticities of demand in different markets are the same at the ruling price
When elasticities of demand are different in different markets at the ruling price
When elasticities cannot be known
When elasticities of demands are zero in different markets at the rulling price
A firms profit is equal to:
R-C
R>C
R
R=C
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
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
The cobweb model will convergent when the slope of:
Demand curve is more than supply curve
Supply curve is more than demand curve
Supply curve is equal to demand curve
None of the above
A firm considering what type of new plant to build is involved in a:
Immediate-run decision
Market period decision
Short-run decision
Long-run decision
The external economies of scale experienced by a firm include the:
Growth of firms processing its waste materials
Development of research bureau serving the industry
Supply of suitable skilled labor in the area
All of the above
If the commodities X and Y are perfect complements then:
None of the above
Microeconomics is also known as:
Price theory
Demand theory
Supply theory
Income theory
Supply and demand changes have their most rapid impact in:
Auction market
Contract markets
Market for commercial office space
Natural gas market
The normal long-run average cost curve is influenced by the:
Principle of diminishing returns
Economies and diseconomies of large scale production
Principle of constant return to scale
All of the above