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
Correct Answer :
B. Affect equilibrium
Related Questions
According to Marshal, the Law of Diminishing Returns is applicable to:
Industry
All fields of production
Agriculture
None of the above
In the real world, some competitive firms owns specialized resources that earn a return called:
Economic profit
Rent
Accounting profit
Normal profit
The engineering production function and engineering costs curves are concerned with the:
Production cost
Collection cost
Raw material costs
Distribution costs
Moving along the indifference curve leaves the consumer:
Better off
Worse off
In equilibrium
Neither better off nor Worse off
If X and Y are close substitutes, a fall in price of X will lead to:
Increase in demand for Y
Decrease in demand for Y
Increase in demand for both X and Y
Increase in demand for Y
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
The main contribution of David Ricardo is in the field of:
Wages of labor
Factor pricing
Theory of rent
Determination of the rate of interest
The Chamberline model recognizes mutual:
Independence of firms
Interdependence of firms
Independence of individuals
Interdependence of materials
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
Economics is a:
Physical science
Social science
Natural science
Basic science
If Cobb-Douglas production function is homogeneous of degree less than one (n<1), then it shows:
Constant returns to scale
Increasing returns to scale
Decreasing returns to scale
None of the above
Under monopolistic competition, the products sold by the firms are:
Economic substitutes
Technical substitutes
Both a and b
None of the above
An indifference curve shows the bundles of two goods among which a consumer remains:
Indifferent
Different
In equilibrium
Dominant
The short-run supply curve of the perfectly competitive firm is given by:
The rising portion of its MR over and above the break-even (shut-down) point
The rising portion of its MC over and above the break-even (shut-down) point
The rising portion of its MC over and above the AC curve
The rising portion of its MC curve
Price discrimination is undertaken with the aim of:
Increasing sales and maximizing profits
Reducing sales and raising prices
Minimizing cost and maximizing revenue
Serving the markets without earning profits
Supply of a commodity refers to:
Total stock of a commodity in the market
Total production of a commodity during the year
Total production plus total stock of a commodity
Amount of commodity offered for sale at some price at a particular place and time
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
The real income of a consumer is income in terms of:
Goods
Goods and survices
Goods and survices it can purchased
Monetary units
Perfect competition implies:
Differentiated goods
Homogeneous goods
Advertised goods
Distress sale of goods
Economic laws are:
Conditional
Moral by nature
Predicted
Like laws of sports
In Nash Equilibrium:
Each player has a dominant strategy
No players have a dominant strategy
At least one player has a dominant strategy
Players may or may not have dominant strategies
When the slope of a demand curve is zero (also known as vertical demand curve) then elasticity will be:
Zero (perfectly inelastic)
Equal to one (unitary elastic)
Infinite (perfectly elastic)
None of the above
An effective price ceiling usually results in:
Excess demand
Qd > Qs
Shortage of supply
All of the above
Which is the correct statement?
The U shape of long-run cost curve is less pronounced than the short-run cost curves
The U shape of the short-run cost curves is less pronounced than the long-run cost curves
The U shape of the long-run cost curve is more pronounced than the short-run cost curves
The long-run cost curves are never U shaped
Under price discrimination, the buyers must:
Be similar
Not be similar
Equal
None of the above
A shift in the demand for a product is likely to result from a change in:
The products price
Expectations
The prices of factors of production used to produced it
Production technology
If in the long run all factor inputs are increased three times and the resulting output is four times as before, it is a case of:
Decreasing returns to scale
Variable returns to scale
Constant returns to scale
Increasing returns to scale
When in a market, the number of buyers is very large and the number of sellers is very small, it is known as:
Monopoly
Oligopoly
Imperfect competition
Perfect competition
Which form of market structure is characterized by interdependence in decision-making as between the different competing firms?
Oligopoly
Perfect competition
Imperfect competition
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