The difference between the average total cost and average variable cost as output increases will:
Increases
Remains the same
Diminishes
Zero
Correct Answer :
C. Diminishes
Related Questions
In the case of an inferior commodity, the income-elasticity of demand is:
Positive
Unitary
Negative
Infinity
The monopolist often lead to exploitation of:
Producers
Workers
Managers
Consumers
Which of the following is assumed to be constant when a supply curve is drawn:
Technology
Number of buyers in the market
Consumer income
Household tastes
At a point below the middle of a straight line demand curve, elasticity of demand is:
Less than one
Equal to one
More than one
Equal to infinity
In case of short-run, the supply curve of an industry is the horizontal summation of:
Marginal cost curves
Average cost curves
Total cost curves
None of the above
On the total utility curve the economically relevant range is the portion over which:
The total utility is rising at a declining rate
The total utility is raising at an increasing rate
Total utility is maximum
Total utility is declining
Income-elasticity of demand is expressed as:
% change in quantity demanded % change in income
% change in income % change in quantity demanded
Change in income Change in quantity demanded
None of the above
Who wrote Economics of Imperfect Competition?
E.H.Chamberlin
Joan Robinson
E.A.G.Robinson
J.M.Keynes
If the demand for good is less elastic and government levied a tax per unit of output, the price per unit for the firm would:
Rise by the amount of the tax
Rise by more than the amount of the tax
Rise by less than the amount of the tax
Remain the same
A market demand curve presumes that:
All consumers are alike
Incomes of all consumers is the same
Tastes of all consumers are the same
Consumers differ in taste, incomes and other matters
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
When in a market, the number of buyers is very large and the number of sellers is very small, it is known as:
Monopoly
Oligopoly
Imperfect competition
Perfect competition
All money costs can be regarded as:
Social costs
Opportunity costs
Explicit costs
Implicit costs
The general form of Cobb-Douglas production function is:
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
The output where TC = TR & AC = AR:
Break-even point
Load point
Shut-down point
Revenue cost point
In income effect, we:
Move to another indifference curve
Move along given indifference curve
Move to lower indifference curve
Move to upper indifference curve
Microeconomics deals with the:
Allocation of resources of the economy as between production of different goods and services
Determination of prices of goods and services
Behavior of industrial decision makers
All of the above
Quantity demanded or supplied is measured in:
Monetary units
Physical units
Relative units
Constant units
In case the two commodities are complements, cross elasticity will be:
Positive
Unitary
Negative
Infinite
In monopoly, when average revenue curve falls:
MR constant
MR rises
MR falls
MR is zero
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
Moving along an indifference curve leaves the consumer:
Better off
Worse off
Neither better nor worse off
None of the above
In an indifference curve diagram, when the price of a product increases, the decline in quantity demanded that results if consumers utility or welfare is kept constant is referred to as the:
Utility effect
Budget line effect
Substitution effect
Income effect
Price discrimination is possible:
When elasticities of demand in different markets are the same at the ruling price
When elasticities of demand are different in different markets at the ruling price
When elasticities cannot be known
When elasticities of demands are zero in different markets at the rulling price
According to law of Equi-Marginal Utility when price of commodity falls then we bought:
More units
Less units
Same units
Zero units
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
Two policy variables, product and selling activities in the theory of firm was introduced by:
Chamberline
Sraffa
Carl marx
Robinson
When price decreases and with it the total outlay on a commodity also decreases, it is a case of:
Perfect elasticity (infinitely elastic)
Relative elasticity (greater than one elasticity)
Perfect inelasticity (zero elasticity)
Relative inelasticity (less than one elasticity)
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