The average fixed cost (AFC) curve is asymptote to:
X-axis
Y-axis
Z-axis
None of the above
Correct Answer :
A. X-axis
Asymptote of a curve is a line such that the distance b/w the curve and the line approaches zero and the slope of the curve at the point approaches the slope of the line. So asymptote is, essentially, a line that a graph approaches, but does not intersect. The AFC curve is horizontal asymptote b/c it gets closer and closer to X-axis but never intersect it.}
Related Questions
When total product increases at a decreasing rate:
MP = AP
MP < AP
MP > AP =0
MP > AP
A monopolist has control over the price he charges for his product. He will be able to maximize his profit by:
Lowering the price, if the demand curve is elastic
Lowering the price, if the demand curve is inelastic
Rising the price, if the demand curve is elastic
None of the above is applicable
According to Diamond Water Paradox diamonds are more expensive than water because:
They yield higher total utility
They yield higher marginal utility
They are more useful
None of the above
Under monopoly and imperfect competition MC is:
More than the price
Less than the price
Equal to the price
Less than or equal to the price
Who is the author of Choice of Technique?
K.N.Raj
Amartiya Sen
A.C.Pigou
Alfred Marshal
The firm is at equilibrium where:
Output is maximum
Profit is maximum
Revenues are maximum
Profit is minimum
Demand is elastic when the coefficient of elasticity is:
greater than zero
less than one
greater than one
less than one
The price under perfect competition is settled by:
Producers
Sellers
Buyers
Sellers and buyers
MC = MR = AC = AR shows the long run equilibrium position of the:
Competitive firm
Oligopolistic firm
Monopolist firm
None of the above
In Edgeworth model, prices oscillate between:
Firms and industry price
Monopoly and duopoly price
Competitive and monopoly price
None of the above
If demand increased and supply decreased then:
Quantity exchanged might rise or fall and price would rise
Quantity exchanged would rise and price would fall
Quantity exchanged would rise and price might rise or fall
Both quantities exchanged and price would rise
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
Normally when price per unit of time falls:
Quantity demanded increases
Quantity demanded decreases
Quantity demanded remains constant
Quantity demanded becomes zero
Each short run average cost curve:
Has to touch the long run cost curve
Has to cross the long run cost curve
Has to lie above all points on the long run cost curve
Coincides with the long run cost curve at some point
We can measure consumers surplus with the help of
TU curve
MU curve
Supply curve
None of the above
An inferior commodity is one whose quantity demand decreases when income of the consumer:
Decreases
Increases
Remains constant
Zero
In collusive olligopoly, the firms may make:
Open agreements
Secret agreements
Both a and b
None of the above
Price discrimination occurs when:
Different prices are charged to different consumers for homogenous products
Same prices are charged for differentiated products
Different prices are charged for homogenous goods for successive units to the same customer
Any of the above condition is present
Production is a function of:
Profits
Costs
Inputs
Price
The Law of Equi-Marginal Utility refers to:
Marginal utility of commodity X
Marginal utility of commodity Y
Marginal utility per rupee spent on X and Y commodities
None of the above
The difference between accounting profits and economic profits is:
Implicit costs
Explicit costs
Fixed costs
Variable costs
Each firm in cournot model starts selling:
1/2 of the total market demand
1/4 of the total market demand
1/3 of the total market demand
None of the above
The slope of isocost line (budget line) shows:
Capital labor ratio
Labor wage ratio
Factor price ratio
Factor labor ratio
The factors of production in perfect competition are:
Stagnant
Mobile
Immobile
Rare
When the law of demand operates the demand curve:
Slopes downward
Slopes upward
Becomes horizontal
Becomes vertical
Which of the following is an implicit cost of production?
Wages of the labor
Charges of electricity
Interest on owned money capital
Payment for raw materials
In joint-profit maximization cartel, the distribution of profit is:
Made by agency
Not made by agency
Made by people
None of the above
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
If a firm is producing output at a point where diminishing returns have set in, this means that:
Each additional unit of output will be more expensive to produce
Each additional unit of output will require increasing amount of inputs
Marginal product of the variable factor of production decreases as the quantity increases
All of the above
The standard form of demand function is:
Q = a- bP
Y = a- bP
Q = a+ bP