The demand of the luxuries is:
More elastic
Less elastic
Unit elastic
Zero elastic
Correct Answer :
A. More elastic
Related Questions
The Hicksian demand curve includes:
Substitution effect
Income effect
Both substitution and income effect
None of them
Price leadership is associated with:
Collusive oligopoly
Non-collusive oligopoly
Cartel
Perfect competition
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
If Cobb-Douglas production function is homogeneous of degree less than one (n<1), then it shows:
Constant returns to scale
Increasing returns to scale
Decreasing returns to scale
None of the above
Time Preference Theory of Interest was presented by:
Adam Smith
Carl Menger
Ruskin
J.B.Say
Which of the following is not characteristic of perfect competition?
Freedom of entry and exit
Each seller is a price taker
Perfect information about prices
Heterogeneous products
In centralized cartel, the firms are like:
Price takers
Price setters
Price discriminators
None of the above
Identify the factor, which generally keeps the price elasticity of demand for a commodity low:
Variety of uses for that commodity
Its low price
Close substitutes for that commodity
High proportion of the consumers income spent on it
In joint-profit maximization cartel, central agency sets the:
Output
Input
Demand
Price
The proportionality rule in production requires that the ratios of MP and factor prices are:
Doubled
Equalized
Not equalized
None of the above
If the commodity is normal then fall in price will result in:
Increase the quantity demanded
Fixed the quantity demanded
Decrease the quantity demanded
None of the above
Cournot equilibrium is attained where two reaction curves:
Repel each other
Represent each other
Intersect each other
None of the above
In the case of complements, the cross demand curve slopes:
Downwards to the right
Upwards to the right
Backwards to the top
Inwards at the bottom
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
From the resource allocation view point, perfect competition is preferable because:
The firms operate at excess capacity levels
There is a whole variety of output produced
There is no restriction on entry and exit of firms
There is no idle capacity
In monopolistic competition, the cost curves of all firms are:
Uniform
Different
Dependent
Independent
MC = MR = AC = AR shows the long run equilibrium position of the:
Competitive firm
Oligopolistic firm
Monopolist firm
None of the above
Some economists refer to iso-product curves as:
Engels curve
Production indifference curve
Budget line
Ridge line
Increasing return to scales can be explained in terms of:
Optimal factor proportions
Fixed scale of plant
External and internal economies
Labor productivity
Which of the following is not a feature of isoproduct curves?
Are downward sloping to the right
Show different input combination producing the same output
Intersect each other
Are convex to the origin
A decrease in demand lowers the price the most:
In the immediate run
In the short run
When the supply is perfectly elastic
When producers have sufficient time to fully adjust to the demand change
The reaction curve of a firm is attained by joining the:
Isoprofit curve
Super profit curve
Normal profit curve
Indoprofit curve
The cobweb model will convergent when the slope of:
Demand curve is more than supply curve
Supply curve is more than demand curve
Supply curve is equal to demand curve
None of the above
7.In an economy based on the price system the decision on what shall be produced is made by:
Government
Consumer
Producer
Stock holder
If a monopolist is producing under decreasing cost conditions, increase in demand is beneficial to the society because:
Consumers get better quality goods
Cost of production falls and hence price will follow
Goods will be sold in many markets
None of the above
Who is the founder of classical school of thought?
David Ricardo
Adam Smith
T.R.Malthus
J.S.Mill
Consumers are likely to get a variety of similar goods under:
Monopoly
Perfect competition
Duopoly
Monopolistic competition
Scarcity is:
A relative term
An economic term
A dynamic term
As a whole term
With the change in the factor prices, the slope of the expansion path will:
Not change
Also change
Increase
Decrease
Neutral Technological Progress can be defined as:
Technological progress that causes to raise the marginal product of capital and labor in the same proportion
Technological progress that causes the marginal product of capital to increase relative to the marginal product of labor
Technological progress that causes the marginal product of labor to increase relative to the marginal product of capital
None of the above