In the long-run:
Fixed cost will be greater than variable cost
Variable costs will be greater than fixed costs
All costs are variable costs
All costs are fixed costs
Correct Answer :
C. All costs are variable costs
In the long run a firm can change all its inputs( size of firm, labor, capital etc) so all costs are variable in long run.}
Related Questions
Who wrote An Introduction to Positive Economics?
R.G.Lipsey
Paul.A.Samuelson
E.D.Domar
J.M.Keynes
A straight line, downward-sloping demand curve implies that, as price falls, the elasticity of demand:
Increases
Decreases
Remains the same
Is zero
Excess capacity is not found under:
Monopoly
Monopolistic competition
Perfect competition
Oligopoly
In Recardian theory of value, the stress has been made on:
Marginal cost
Production cost
Labor cost
Supply cost
In market sharing cartel model, cartel determines the shares of:
the individuals
industry
firms
associations
The alternative of profit maximization theory is:
Cost maximization
Product maximization
Revenue maximization
None of the above
Along an isoquant, output remains same, and capital labor ratio:
Is also same
Is different
Is constant
Is zero
Income -elasticity of demand will be zero when a given change in income brings about:
A less than proportionate change in quantity demanded
A more than proportionate change in quantity demanded
The same proportionate change in quantity demanded
No change in quantity demanded
Who is the founder of classical school of thought?
David Ricardo
Adam Smith
T.R.Malthus
J.S.Mill
The firm in cournot model:
face costs
face taxes
donot face taxes
donot face costs
Airlines that try to lower fares in order to increase revenues believe that demand for airline services is:
Price elastic
Price inelastic
Income elastic
Income inelastic
We can write ordinal utility function as:
U = x1 x2
U = x1 + x2
U = y1 +x1
U = x1.x2
The equilibrium of a firm is determined by the equality of MC and MR in only:
Under perfect competition
Under monopoly
Under imperfect competition
Under all the above market forms
Diminishing returns occur when a firm:
Starts incurring losses
Uses more and more of one input while holding all other inputs constant
Does not utilize its inputs efficiently
Cuts down on the quantity of all inputs it uses
Supply and demand changes have their most rapid impact in:
Auction market
Contract markets
Market for commercial office space
Natural gas market
When elasticity of demand is less than one (e<1), then following the formula MR=P[1-1/e], the MR will:
Positive
Negative
Zero
None of the above
An economic model describing the working of an economy consists of:
Functional relationships
Family relationships
Economic position
Stagnant relationships
Under monopolistic competition, the products sold by the firms are:
Economic substitutes
Technical substitutes
Both a and b
None of the above
The demand curve of a firm in monopolistic competition is:
Negatively sloped
Vertical
Horizontal
Positively sloped
The CES production function shows:
Decreasing return to scale
Increasing return to scale
Constant return to scale
None of the above
In Prisoner Dilemma, the best choice of strategy is:
Stable
Unstable
Negative
Neutral
In monopoly, new firms:
Can enter and exit
Partially can enter and exit
Cannot enter
None of the above
Under perfect competition, the average revenue, marginal revenue and price are shown:
By a same single curve
By three different curves
By downward sloping curve
None of the above
The proportional demand curve in monopolistic competition (also in kinked demand curve model), is like industry demand curve in:
Monopolistic competition
Imperfect competition
Monopoly
Perfect competition
The number of sellers in oligopoly are:
Two
Many
Four
Very few
One way the government can induce a monopolist to expand his output is by imposing:
A specific tax on the monopolists output
A price ceiling that make the monopolist lower his price
A price floor that make the monopolist raise his price
A heavy tax on the monopolists profit
In 1890, Principles of Economics was written by:
Prof. Robbins
Alfred Marshal
Prof. Senior
Adam Smith
The vertical demand curve for a commodity shows that its demand is:
Highly elastic
Perfectly inelastic
Fairly elastic
Moderately elastic
The law of Diminishing Marginal Utility implies that the marginal utility of a good decreases as:
It gets more expensive
A household consumes more of it
Preference changes
A households income goes up
Supply of commodity is a:
A stock concept
A flow concept
Both stock and flow
None of the above