The indifference curve technique:
Helps in separating the income effect and the substitution effect
Does not help in separating the two effects
Mixed up the two effects
None of the above
Correct Answer :
A. Helps in separating the income effect and the substitution effect
Related Questions
The cost of one thing in terms of the alternative given up is known as:
Production cost
Physical cost
Real cost
Opportunity cost
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
Of the following commodities, which has the lowest price-elasticity of demand?
Car
Salt
Tea
House
A market demand schedule is obtained by adding individual demand schedules:
Horizontally
Vertically
Permanently
Perpetually
Classical production function is:
Q = f(L)
U =f(X)
Q =f(K)
Q =f(L,K)
An effective price ceiling usually results in:
Excess demand
Qd > Qs
Shortage of supply
All of the above
Which of the following is not an explicit cost of production?
Wage of self-employed proprietor
Depreciation on machinery
Returns on owned capital
Cost of raw materials
In economist the term invisible hand is refers to:
Hand of God
Market self regulating system
Hands of invisible people
Regulations of government
The number of sellers in duopoly is:
A few
Four
Two
Very large
The greater the percentage of income spent on a commodity:
The greater its elasticity is likely to be
The weaker its elasticity is likely to be
The unchanged its elasticity is likely to be
None of the above
If the price of coffee increases, you would predict that:
Demand curve for sugar will shift downward (leftward)
Supply curve for sugar will shift leftward (upward)
Demand curve for bread will shift downward (leftward)
None of the above
The optimal strategy for a player is termed as:
Recessive strategy
Dormant strategy
Dominant strategy
Hidden strategy
Production is a function of:
Profits
Costs
Inputs
Price
In Prisoners Dilemma, both the prisoners are interrogated:
Separately in different cells
Collectively in different cells
Collectively in same cell
Separately in same cell
An increase in the supply of a commodity is caused by:
Improvements in its technology
Fall in the prices of other commodities
Fall in the prices of factors of production
All of the above
To attain maximum profits during short-run a firm should produce the output that will:
Yield maximum total revenue
Minimize marginal cost
Maximize marginal cost
Equate marginal revenue with marginal cost
In monopolistic competition, if a firm lowers its price, the rival firms will:
Also lower their prices
Increase their prices
Show no reaction
None of the above
In modern theory of costs, a firm normally utilizes:
2/3 of capacity of its plants
3/4 of capacity of its plants
1/3 of capacity of its plants
1/2 of capacity of its plants
The consumer is in equilibrium at the where:
Budget line and indifference curve intersect each other
Budget line and indifference curve are tangent to each other
Budget line and indifference curve are opposite to each other
Budget line and indifference curve are parallel to each other
If the commodity is inferior then the increase in income of the consumer results in:
More purchase
Less purchase
Same purchase
None of the above
An iso-product (an isoquant) curve slopes:
Downward to the left
Downward to the right
Upward to the right
Upward to the left
Elasticity of supply means change in supply due to change in:
Price of the commodity
Conditions of supply
Taste of the consumer
Demand for the commodity
Increase in demand occurs when:
The price falls and the demand also falls down
The price increases but demand falls down
The price increases the demand remains constant and when the price remains constant the demand goes up
The price remains constant but demand falls
Equilibrium of a firm represents maximization of profits as well as:
Maximization of losses
Minimization of losses
Minimization of profits
None of the above
Abstinence or Waiting theory of Interest was presented by:
Lord Keynes
J.S.Mill
Alfred Marshal
Prof.Senior
If the demand curve is vertical then its slope is:
Infinite
Zero
Equal to one
None of the
The marshallian indirect utility function in the form of equation is:
x =a-bp
x =b-ap
x = f(P)
Of the following, which one corresponds to fixed cost?
Payments for raw materials
Labor cost
Transportation charges
Insurance premium on property
Capital Saving 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
When marginal costs curve cuts average costs curve, average costs are:
Maximum
Zero
Minimum
Equal to one