Law of Variable Proportions is regarding in:
Short-Run
Long-Run
Medium-Run
None of the above
Correct Answer :
A. Short-Run
Related Questions
A market demand schedule is obtained by adding individual demand schedules:
Horizontally
Vertically
Permanently
Perpetually
When elasticity of demand is greater than one (e >1), then following the formula MR=P[1-1/e], the MR will:
Positive
Negative
Zero
None of the above
In second degree price discrimination, monopolist takes away :
All of the consumer surplus
All of the producer surplus
Some part of the consumer surplus
None of them
When the slope of a demand curve is infinite (also known as horizontal demand curve) then elasticity will be:
Zero (perfectly inelastic)
Equal to one (unitary elastic)
Infinite (perfectly elastic)
None of the above
If the commodities X and Y are perfect complements then:
None of the above
In case the two commodities are complements, cross elasticity will be:
Positive
Unitary
Negative
Infinite
By increasing the price of its products above those of its competitors, a perfectly competitive seller:
Can sell more
Reduces its revenues
Can sell nothing
Increases its revenues
For the given production function, technical inefficiency is defined as:
Sets of points relating production function that maximizes output given input (labor) i.e. Q = f(L, K)
Sets of points relating production function that produces less output than possible for a given set of input (labor) i.e. Q < f(L, K)
Use of imported technology
None of the above
The Law of Diminishing Marginal Returns can be explained in terms of:
Economies and diseconomies of production
Indivisibility of factors
Fixity of supply of land
Variable factor productivity
The fixed cost of a firm:
Are fixed even in the long period
When expressed as an average, show a continuous decline with increase of output
Do not reflect diminishing marginal returns
None of the above
In the long run:
All factors can be used in different proportions
Management can be re-organized
A firm can experience returns to scale
All of the above
General Equilibrium deals with the equilibrium of the:
Consumer
Producer
Farmer
All the producers and consumers
Which of the following conditions is met in the long-run equilibrium in monopolistic competition, where the firm is earning only normal profits?
MC =AC and P
MC = AC and P=MR
P =MC and P
MC=MR and P =AR= ATC
A country is advised to devalue (reduce external value of) its currency only when its exports face:
Inelastic demand in foreign markets
Elastic demand in foreign markets
Unit elastic demand in foreign markets
None of the above
There is no difference between fixed and variable factors in the:
Long run
Short run
Average run
None of the above
Total utility and price are:
Directly related
Unrelated
Closely related
Negatively related
A monopoly producer usually earns:
Abnormal profits
Only normal profits
Neither profits nor losses
Profits and losses which are uncertain
The competitive equilibrium leads to:
The firms producing with excess capacity
The firms producing at their minimum costs
Firms producing at a cost higher than the minimum
Some firms producing under decreasing costs and others under increasing costs
In the case of an inferior good, the income effect:
Partially offsets the substitution effect
Reinforces the substitution effect
Is equal to the substitution effect
More than offsets the substitution effect
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
If the prices of goods rise then:
The real income of consumer falls
The real income of consumer rises
The real income of a consumer remains constant
The real income of consumer becomes zero
According to critics, the assumption of costless production is:
true
not true
reliable
deniable
Who finalized the model of imperfect competition?
Ricardo
Marshal
Chamberlin
Mrs. Robinson
If the production function is homogeneous, the expansion path will be a straight line through the origin whose slope determines the optimal:
L/K ratio
K/L ratio
P/L ratio
P/K ratio
Total fixed costs are:
The Hicksian demand curve includes:
Substitution effect
Income effect
Both substitution and income effect
None of them
Which of the following pairs of commodities is an example of substitutes?
Tea and sugar
Tea and coffee
Pen and ink
Shirt and trousers
In Recardian theory of value, the stress has been made on:
Marginal cost
Production cost
Labor cost
Supply cost
In case of monopoly, the price charged against the additional unit is:
Not different
Same
Not same
Zero
The budget-line is also known as the:
Iso-utility curve
Production possibility line
Isoquant
Consumption possibility line