In modern cost theory, AVC= b1 and MC= b1 in the range of:
Excess capacity
Reserve capacity
Limited capacity
None of the above
Correct Answer :
B. Reserve capacity
In modern theory of cost, in the range of reserve capacity, the MC curve and AVC curve both are equal and same.}
Related Questions
The sufficient condition of firms equilibrium requires:
none 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
Some economists refer to iso-product curves as:
Engels curve
Production indifference curve
Budget line
Ridge line
In sweezy model (kinked demand curve model), the overall increase in costs of production:
Do not effect equilibrium
Affect equilibrium
Both a and b
None of the above
Slope of a demand curve is:
Not relevant to elasticity
The only factor determining elasticity
Only one of the factors influencing elasticity
None of the above
Cross-demand curve shows:
The effect of a change in price of X on its demand
The effect of a change in price of X on the demand for Y
The effect of a change in price of Y on its demand
None of the above
Theory of revealed preference is based on:
Weak orderings
Neutral orderings
Partial orderings
Strong orderings
Which one of the following has been the most influential work of F.H.Knight?
Freedom and Reform
The Green Revolution
Economic Integration
Risk ,Uncertainty and Profit
If in the long run, output increases in the same proportion as increase in all the input in the given proportion, this is known as:
Increasing returns to scale
Decreasing returns to scale
Constant returns to scale
Variable returns to scale
In Edgeworth model, price remains:
Constant
On increasing
Independent
Indeterminate
The market demand for any commodity is the:
Average requirement for it in any given place
Amount of it wanted at any given price
Amount that people would like to buy during a period at different prices
Quantity needed to maintain a given standard of living
The costs faced by the firm against variable factors are:
Variable costs
Fixed costs
Average costs
Marginal costs
MC = MR = AC = AR shows the long run equilibrium position of the:
Competitive firm
Oligopolistic firm
Monopolist firm
None of the above
If less is demanded at the same price or same quantity demanded at a lower price, it is a case of:
Contraction of demand
Decrease in demand
Increase in demand
Extension of demand
The goods sold by firms under monopolistic competition are technological as well as:
Economic complements
Economic substitutes
Economic inferiors
None of the above
In the case of superior (normal) commodity, the income elasticity of demand is:
Positive
Unitary
Negative
Infinite
With firms having cost differences under perfect competition, a firm, which earns normal profit in the long-run is called:
An optimum firm
A representative firm
An oxford firm
A marginal firm
If the commodity is normal then the Income Effect (I.E) and the Substitution Effect (S.E):
Both move together and reinforce each other
One moves and the other remains constant
Move in the opposite direction and neutralize each other
Both remain constant
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
The total utility is gained by consuming:
The last unit of a good
All the units of a good
The first unit of a good
The average unit of a good
Marginal utility is only meant for:
Half utility
Full utility
Additional utility
Multiplied utility
The central problem of economics is:
Declining productivity
Increasing consumption
Limited material wants
Limited resources and unlimited wants
The monopolist who is producing the same output from two (or more than two) plants is concerned with:
Single-plant monopolist
Multi-plant monopolist
Two-plant monopolist
Some-plant monopolist
The pay-off matrix shows:
Possible outcomes
Possible benefits
Possible losses
None of them
When total product falls:
MP is positive
MP is negative
MP is falling
MP is rising
A producer attains the least cost combination when the relation between Marginal Rate of Technical Substitution (MRTS) and price (P) of the factors x and y is:
Which of the following curves is a rectangular hyperbola?
ATC
AVC
AFC
None of the above
In finding equilibrium position of a profitmaximizing firm, which technique is most convenient?
Total revenue and total cost technique
Marginal revenue and marginal cost technique
Demand and supply technique
None of the above
In the long-run competitive equilibrium:
There is tendency for firms to enter but not leave the industry
Firms have no tendency either to enter or to leave the industry
Some firms may enter while the others may leave the market even after the equilibrium of the industry
Entry or exit of the firms cannot be predicted
In dominant strategies I am doing the best, I can no matter:
What you do
What you are doing
What you not do
None of them