Perfect competition assumes:
All buyers and sellers have perfect knowledge of the market
Freedom of entry of firms into the industry
Homogeneous product
All of the above
Correct Answer :
D. All of the above
Related Questions
When the output of a firm is increasing, its average fixed cost:
Declines continuously
Remains constant
Rises continuously
Declines and then rises
A profit-maximizing monopolist in two separate markets will:
Charge the same price in both markets
Always charge a higher price in the market where he sells more
Always charge a higher price in the market where he sells less
Adjust his sales in the two markets so that his marginal revenue in each market just equals his aggregate marginal cost
Under pure monopoly, there will be:
No distinction between firm and industry
One firm and no industry
No firm and no industry
None of the above
The optimum level of output in long run takes place where:
LAC = LMC
SAC = LMC
SAC =MC
SAC =LAC
Cross-elasticity of demand or cross-price elasticity between two independent goods will be:
Negative
Positive
Infinite
Zero
Substitution effect means a consumer
Shifts away from the commodity the price of which has fallen
Shifts in favour of a commodity the price of which has risen
Shifts away from a commodity the price of which has risen, in favour of a commodity the price of which has fallen
None of the above
The central problem of economics is:
Declining productivity
Increasing consumption
Limited material wants
Limited resources and unlimited wants
In the case of two factor inputs which are neither perfectly complementary nor perfect substitutes, the iso-product curve will be:
A downward sloping straight line
A downward sloping curve
An upward rising curve
Right angled iso-quants
According to Marshallian approach, utility:
Can be added
Can be subtracted
Can be multiplied
Can be divided
External economies are witnessed in:
A rising supply curve
A rising demand curve
A falling supply curve
A falling demand curve
Average cost curve contains in it:
Normal profits
No normal profits
Sometimes normal profits and sometimes no normal profits
Super normal profits
An inferior commodity is one whose quantity demand decreases when income of the consumer:
Decreases
Increases
Remains constant
Zero
In case of monopoly, the price charged against the additional unit is:
Not different
Same
Not same
Zero
Elasticity (E) expressed by the term, 1>E>0, is:
Perfectly elastic
Relatively elastic
Unitary elastic
Relatively inelastic
Liquidity of Preference Theory was introduced by:
Alfred Marshal
Lord Keynes
Karl Marx
Prof. Robbins
The monopolist firm is price setter. The price setter firm is one which:
Can influence the market price
Cannot influence the market price
Can sell at zero price
None of the above
If the commodity is inferior then:
Income effect is positive but substitution effect is negative
Income effect is negative but substitution effect is positive
Both income effect and substitution effect are negative
Both income effect and substitution effect are positive
If a straight line supply curve makes an intercept on the X-axis, the elasticity of supply is:
Equal to unity
Less than unity
More than unity
Zero
Marginal revenue from a given output:
The price at which the marginal unit sells
Total revenue sale of all units divided by volume of sales
Average revenue of total output average revenue of last unit
The change in total revenue resulting from the sale of one unit more of output
The good will highest income elasticity is:
Beef
Mutton
Bread
Motion-picture tickets
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
With an increase in income, consumer is expected to buy more of:
An inferior good
A giffen good
A normal(or superior) good
None of the above
An indifference curve shows the bundles of two goods among which a consumer remains:
Indifferent
Different
In equilibrium
Dominant
Which of the following would be least likely to cause a consumer to eat less beef?
An increase in the price of beef
An increase in the price of lamb
A reduction in the consumers income
A reduction in the price of lamb
The short-run supply curve of the perfectly competitive firm is given by:
The rising portion of its MR over and above the break-even (shut-down) point
The rising portion of its MC over and above the break-even (shut-down) point
The rising portion of its MC over and above the AC curve
The rising portion of its MC curve
The production function of homogeneous of degree one (n=1) is also called:
Linearly homogeneous
Zero homogeneous
Infinite homogeneous
None of the above
Consumer surplus is the difference between
Price demanded and price paid
Price quoted and price actually paid
Price that a consumer is willing to pay and the price actually paid
None of the above
The costs faced by the firm against variable factors are:
Variable costs
Fixed costs
Average costs
Marginal costs
If there are many firms producing similar but differentiated products, the competition is generally said to be:
Oligopoly
Pure competition
Perfect competition
Monopolistic competition
Which is the first-order condition for the profit of a firm to be maximum?
AC=MR
MC=MR
MR=AR
AC=AR