Marginal cost curve cuts the average cost curve:
At the left of its lowest point
At its lowest point
At the right of its lowest point
None of the above
Correct Answer :
B. At its lowest point
Related Questions
In the real world, some competitive firms owns specialized resources that earn a return called:
Economic profit
Rent
Accounting profit
Normal profit
Using total revenue and total cost, a profit maximizing firm will be equilibrium at a point:
Where the gap between the two is the smallest
Where the gap between the two is the greatest
Where the two become equal
None of the above
Whenever a group of monopolistic competitors attains equilibrium, the firms in this group usually:
Charge different prices, but produce identical outputs
Produce different outputs, but charge identical prices
Charge different prices, and produce different outputs
None of the above
The long run total cost is attained by:
LMC.Q
AC.Q
LC.Q
LAC.Q
When total revenue is maximum in monopoly, elasticity of demand is:
E =1
E >1
E <1
E =0
When the consumer is in equilibrium not only his income is fully spent, but the ratio of marginal utility and price is:
Increased
Equalized
Prominent
Zero
The point on which the average cost is minimum in a firm, short run average cost curve will also be the minimum cost point on the firms long-run average cost curve. This is true:
Always
Never
When LAC is falling
Only at that level of output when LAC is at its minimum
A market demand schedule is obtained by adding individual demand schedules:
Horizontally
Vertically
Permanently
Perpetually
In general, most of the production functions measure:
The productivity of factors of production
The relation between the factors of production
The economies of scale
The relations between change in physical inputs and physical output
The main contribution of Prof.Robbins is in the field of:
human welfare
national income
multiplicity of wants and scarcity of resources
theory of production
The isoquant approach is based upon:
One output
One input
Two outputs
Two inputs
In constant sum game (zero sum game), if there are two parties then:
Both parties make better-off
Both parties make worse-off
Both parties become Neutral
One party can become better off only if another is made worse off
Under competitive conditions, the industry will be in equilibrium:
When each firm is in equilibrium equating MC with MR
When all the firms are earning only normal profits
When firms outside have no tendency to enter the industry and those within, have no tendency to leave the industry
All of the above
The addition or increment to the total cost involvesd in expanding or contracting output by one unit is called:
Fixed cost per unit
Variable cost per unit
Total cost per unit
Marginal cost
Inputs or Factors of production are defined as:
Productive resources such as labor and capital equipment that firms use to manufacture goods and services are called inputs or factors of production
Unproductive resources that do not take part in production process are called inputs or factors of production
Firms own resources are called inputs or factors of production
None of the above
In case of giffin good, price effect is:
Positive
Negative
Neutral
Infinite
Of the following, which one is a characteristic of monopolistic competition?
Standardized product
Differentiate product
Two firms
No entry
At the shut-down point in perfect competition:
P = AVC
TR =TVC
The total losses of the firm equal TFC
All of the above
Cardinal approach includes arranging:
The different combinations of X and Y higher and lower without actually measuring the difference of utility between them
The different combinations of X and Y higher and lower and measuring the difference of utility between them
Different combination of X, Y and Z
None of above
Price leadership is associated with:
Collusive oligopoly
Non-collusive oligopoly
Cartel
Perfect competition
Production function shows:
Technical relationship between inputs and output
Profitability production
Relation between MR and MC
Relation between AR and AC
In case of income effect, the level of consumers satisfaction rises when:
Income rises
Income falls
Sales rises
Price falls
Normal profits are considered as:
Explicit costs
Implicit costs
Social costs
Private cost
Any straight line supply which cuts the x-axis will have:
Zero elasticity
An elasticity greater than one
Unitary elasticity of supply
An elasticity less than one
The budget constraint can be written as:
X.PX + Y.PY = 1
X.PX + Y.PY < 1
X.PX + Y.PY > 1
X.PX + Y.PY = 0
The Purchasing Power Parity (PPP) Theory is presented by:
J.M.Keynes
E.D.Domar
Adam Smith
Gustav Cassel
In monopolistic competition, the firms face:
Horizontal demand curve
Vertical demand curve
Similar demand curve
Differential demand curve
Under monopolistic competition, in long-run there is:
Ban on exit
Ban on entry
Free entry
Free entry and exit
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
Which of the following has more elastic demand curve?
A commodity without substitutes
A commodity with substitutes
A commodity on which a small fraction of income is spent
A commodity the use of which cannot be postponed