Law of variable proportions is based on the assumption of:
Short period of time
Long period of time
Timeless production relationship
All of the above
Correct Answer :
A. Short period of time
Related Questions
Excess capacity is concerned with the:
V-shaped traditional cost curves
S-shaped traditional cost curves
Modern cost curves
U-shaped traditional cost curves
Rational economic behavior on the part of the consumer means that he will:
Save as much of his income as possible
Spend as much of his income as possible
Buy everything at the lowest possible price
Make wise choices among available economic goods
The firm is at equilibrium where:
Output is maximum
Profit is maximum
Revenues are maximum
Profit is minimum
In case of monopoly, the price charged against the additional unit is:
Not different
Same
Not same
Zero
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
Which of the following is the work of A.C.Pigou?
Economics of Welfare
Commerce and Trade
Industrial Economics
None of the above
Production function relates:
Cost to input
Wages to profits
Cost to output
Inputs to output
Economic laws are:
Conditional
Moral by nature
Predicted
Like laws of sports
A price is a ratio of exchange between:
Money and exchange
Quantity and production
Production and consumption
Money and quantity
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
In real life, brand loyalty is a barrier to:
Enter the new firms
Exit the new firms
Both a and b
None of the above
Law of Variable Proportions is regarding in:
Short-Run
Long-Run
Medium-Run
None of the above
Extension (expansion) and contraction of demand are result of:
Change in consumers income
Change in consumers tastes
Change in price
None of the above
Formulation of an economic theory involves:
Statements of various assumptions or postulates
Logical deductions from the assumptions made
Testing the hypothesis against empirical evidence
All of the above
Who wrote Economics of Imperfect Competition?
E.H.Chamberlin
Joan Robinson
E.A.G.Robinson
J.M.Keynes
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
When total product increases at a decreasing rate:
MP = AP
MP < AP
MP > AP =0
MP > AP
In short-run, in monopolistic competition, a firm earns:
Normal profits
Abnormal profits
No profits
All of the above
If the commodity is inferior then Income Effect (I.E) is:
Negative
Positive
Zero
Infinite
In which case the elasticity shown by the different points of a curve is the same?
A straight line curve
A downward sloping demand curve
A rectangular hyperbola demand curve
None of the above
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
A firm considering what type of new plant to build is involved in a:
Immediate-run decision
Market period decision
Short-run decision
Long-run decision
If the price of a product falls which of the following would occur?
Indifference curves shift down
Budget line shifts down
Indifference curve shift up
Budget line pivots
Social costs equal private costs when:
Marginal cost is zero
Total cost is zero
External costs are zero
Average costs are zero
Price-taker firms:
Advertise to increase the demand for their product
Do not advertise, because most advertising is wasteful
Do not advertise because they can sell as much as they want at the current price
Who advertise will get more profits than those who do not
An increase in the supply of a commodity is caused by:
Improvements in its technology
Fall in the prices of other commodities
Fall in the prices of factors of production
All 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
According to Chamberlin, the activity of a monopolistic competitive firm:
Get noticed by the rival firms
Get unnoticed by the rival firms
Get noticed by the employees of the rival firms
None of the above
LMC represents change in LTC (long-run total cost) due to producing an additional unit of a good while the fixed and variable factors:
Cannot be changed
Can be changed
Can partially be changed
None of the above
Stable cobweb model is a:
Simple model
Dynamic model
Both of them
None of them