Home
Current Affairs January 2024

What is the correct answer?

4

In the long-run competitive equilibrium:

A. There is tendency for firms to enter but not leave the industry

B. Firms have no tendency either to enter or to leave the industry

C. Some firms may enter while the others may leave the market even after the equilibrium of the industry

D. Entry or exit of the firms cannot be predicted

Correct Answer :

C. Some firms may enter while the others may leave the market even after the equilibrium of the industry


In perfect competition, new firms will be tempted to enter the market if some of the existing firms in the market are earning positive economic profits. Alternatively, existing firms may choose to leave the market if they are earning losses. For these reasons, the number of firms in a perfectly competitive market is unlikely to remain unchanged in the long-run.}

Related Questions

What is the correct answer?

4

The feasible part of the demand curve for the monopolist who is charging high price will be:

A. The elastic part of a demand curve

B. The inelastic part of a demand curve

C. The constant elastic part of the demand curve

D. None of the above

What is the correct answer?

4

The relationship between AC and MC curves depend upon the behavior of:

A. AP curves

B. MP curves

C. Both of them

D. None of them

What is the correct answer?

4

The water diamond paradox was firstly resolved with the help of:

A. Labor theory of value

B. Individual theory of value

C. Producer theory of value

D. Consumer theory of value

What is the correct answer?

4

Rotten eggs are:

A. Free goods

B. Economic goods

C. Luxury goods

D. None of the above

What is the correct answer?

4

A dominant strategy can best be described as:

A. A strategy taken by a dominant firm

B. A strategy taken by a firm in order to dominate its rivals

C. A strategy that is optimal for a player no matter an opponent does

D. A strategy that leaves every player in a game better off

What is the correct answer?

4

To calculate the elasticity of demand, which of the following formula is used?:

A. Percentage change in demand Original demand

B. Proportionate change in demand Proportionate change in price

C. Change in demand Change in price

D. None of the above

What is the correct answer?

4

An indifference curve normally slopes downward from:

A. Left to right

B. Right to left

C. Both of them

D. None of them

What is the correct answer?

4

In a socialist (communist) economy the invisible hand:

A. Guides most resource allocation decisions

B. Operates effectively only in the labor market

C. Operates effectively only in the market for capital

D. Is prevented from operating effectively

What is the correct answer?

4

In cournot model, firms make decisions separately regarding:

A. output

B. input

C. price

D. advertisement

What is the correct answer?

4

Selling costs are incurred under monopolistic competition to:

A. Attract more customers

B. Prevent its customers from going to others

C. Establish superiority of its product on the others

D. All of the above

What is the correct answer?

4

In case of short-run, the supply curve of an industry is the horizontal summation of:

A. Marginal cost curves

B. Average cost curves

C. Total cost curves

D. None of the above

What is the correct answer?

4

Which of the following is not a feature of isoproduct curves?

A. Are downward sloping to the right

B. Show different input combination producing the same output

C. Intersect each other

D. Are convex to the origin

What is the correct answer?

4

The main contribution of Malthus is in the field of:

A. Consumption expenditure

B. Theory of population

C. Division of labor

D. Theory of demand

What is the correct answer?

4

In discriminating monopoly (price discrimination), the cost of production in two markets are:

A. Different

B. Same

C. Zero

D. None of the above

What is the correct answer?

4

Returns to scale is a:

A. Timeless phenomenon

B. Short run phenomenon

C. Long run phenomenon

D. None of the above

What is the correct answer?

4

In economic term water is a:

A. Free good

B. Economic good

C. Both of the above

D. None of the above

What is the correct answer?

4

Supply of commodity is a:

A. A stock concept

B. A flow concept

C. Both stock and flow

D. None of the above

What is the correct answer?

4

Cournot equilibrium is attained where two reaction curves:

A. Repel each other

B. Represent each other

C. Intersect each other

D. None of the above

What is the correct answer?

4

In constant sum game (zero sum game), if there are two parties then:

A. Both parties make better-off

B. Both parties make worse-off

C. Both parties become Neutral

D. One party can become better off only if another is made worse off

What is the correct answer?

4

Law of Variable Proportions is regarding in:

A. Short-Run

B. Long-Run

C. Medium-Run

D. None of the above

What is the correct answer?

4

A monopolist is:

A. Price winner

B. Price searcher

C. Price taker

D. Price leaver

What is the correct answer?

4

Suppose income increases by 10% and demand for commodity increases by 5% then the income elasticity of demand is:

A. Negative

B. Positive

C. Zero

D. Infinity

What is the correct answer?

4

In case of straight-line isoquant, the factors are not substituted because they are each others:

A. Imperfect substitutes

B. Perfect substitutes

C. Complements

D. None of the above

What is the correct answer?

4

If demand increased and supply decreased then:

A. Quantity exchanged might rise or fall and price would rise

B. Quantity exchanged would rise and price would fall

C. Quantity exchanged would rise and price might rise or fall

D. Both quantities exchanged and price would rise

What is the correct answer?

4

Whish of the following represents the average revenue curve of a firm?

A. The curve representing the cost per unit of output

B. The demand curve of consumers for the firms product

C. Total receipts realized by the firm

D. All of the above

What is the correct answer?

4

In economics, Externality means:

A. An externality is a cost or benefit which is not transmitted through prices

B. An externality is a cost or benefit which is transmitted through prices

C. An externality is a production received through external resources

D. None of the above

What is the correct answer?

4

Law of Substitution in production was presented by:

A. Classical economists

B. Keynes

C. Neo-classical economists

D. Karl Marx

What is the correct answer?

4

The addition or increment to the total cost involvesd in expanding or contracting output by one unit is called:

A. Fixed cost per unit

B. Variable cost per unit

C. Total cost per unit

D. Marginal cost

What is the correct answer?

4

Efficient allocation of resources is likely to be achieved under:

A. Monopoly

B. Monopolistic competition

C. Perfect competition

D. Any market form

What is the correct answer?

4

Cross-elasticity of demand or cross-price elasticity between two perfect complements will be:

A. Negative

B. Positive

C. Infinite

D. Negative infinite