In perfectly competitive markets, the profit maximization rule can be represented by:
MR=ATC
P=ATC
P=MC
P=AC
Correct Answer :
C. P=MC
Related Questions
The giffen paradox is an exception to law of:
Supply
Demand
Production
Consumption
Under monopolistic competition, the firms compete alongwith:
Supreme powers
Discretionary powers
Low powers
None of the above
The elasticity of substitution measures the percentage change in the ratio of inputs when any producer observes the percentage change in:
Output cost
Output ratio
Input prices
Input ratio
Cross-elasticity of demand or cross-price elasticity between two substitutes will be:
Negative
Positive
Infinite
Zero
The expansion point is attained by joining:
Similar optimal combinations
Different optimal combinations
Both of them
None of them
When the demand curve is rectangular hyperbola, it represents:
Unitary elastic demand
Perfectly elastic demand
Perfectly inelastic demand
Relatively elastic demand
According to M.Kalecki, the true measure of the degree of monopoly power is the:
Ratio between price and marginal cost
Extent of monopolistic profit enjoyed by him
Cross-elasticity of demand for the product of the monopolist
Price charged by the monopolist minus marginal cost of production
The modern cost curves are based upon the idea of:
Fixed capacity
Specific capacity
Excess capacity
Reserve capacity
All money costs can be regarded as:
Social costs
Opportunity costs
Explicit costs
Implicit costs
In long run competitive equilibrium:
Every firm will earn economic profit
Every firm will incur losses
Every firm will earn only normal profit
The marginal firm will earn no profit
Under the law of variable proportions, the average and the marginal product of the variable factor would ultimately:
Become equal
Decrease
Become constant
Increase
Duopoly is a market where there are:
Two sellers
A few sellers
Five sellers
Many sellers
According to translog production function, elasticity of substitution is:
Greater than one
Less than one
Zero
Equal to one
The price consumption curve (PCC) for commodity X is the locus of points of consumer equilibrium resulting when:
The price of only Y is varied
The price of only X is varied
The prices of both Y and X are varied
None of the above
The monopolist often lead to exploitation of:
Producers
Workers
Managers
Consumers
Equilibrium of a firm represents maximization of profits as well as:
Maximization of losses
Minimization of losses
Minimization of profits
None of the above
Price elasticity of demand can be measured in the following way:
Percentage change in quantity demanded of a commodity divided by percentage change in price of that commodity
Change in quantity demanded of a commodity divided by change in price of that commodity
Percentage change in price of a commodity divided by percentage change in quantity demanded of that commodity
None of that commodity
According to Robbins, economics is a:
Science of wealth
Science of national welfare
Science of optimality
Science of scarcity
Under monopoly and imperfect competition MC is:
More than the price
Less than the price
Equal to the price
Less than or equal to the price
The nominal income of a consumer is income in terms of:
Goods
Goods and services
Goods and services it can purchased
Monetary units
The Cambridge School of Thought refers to the group of English economists who came under the influence of:
Alfred Marshal
J.M.Keynes
Paul A.Samuelson
A.C.Pigou
Under conditions of perfect competition, price in the long-run is equal to:
Minimum of average variable cost
Minimum of marginal cost
Minimum of average fixed cost
Minimum of average cost
The situation in between the extremes of the govt. controlled, planned economy and the perfectly free, unplanned economy is known as:
Developed economy
Laissez-fair economy
Mixed economy
Capitalistic economy
The effect of consumer boycotts usually is:
A rise in the price of the product
A decrease in the demand for the product
A decrease in the supply of the product
An increase in the quantity supplied of the product
Given a U shaped average cost curve, the relationship between average cost and marginal cost is such that marginal cost must always be:
Falling when average cost is falling
Rising when average cost is falling
Falling when average cost is rising
Rising when average cost is rising
Any expansion in output by a firm in the short period will always reduce the:
Average variable cost
Average fixed cost
Both average fixed and variable cost
None of the above
MC curve is:
L-shaped
U-shaped
V-shaped
Both a and b depending on situation
In case of economic bads, an IC can be :
Sloping downward
Sloping upward
Positively sloped
Negatively sloped
The elliptical isoquant represents the:
Economic combinations of labor and capital
Uneconomic combinations of labor and capital
Both a and b
None of the above
A good tends to have relatively inelastic demand, if:
Close substitutes are available
It has a high price
It is a luxury
It has no very close substitutes