The long-run AC curve is constructed from:
The minimum points on all short-run AC curves
The lowest points on the short-run MC curve
The minimum points on the short run AVC curves
It has nothing to do with the short-run cost curves
Correct Answer :
A. The minimum points on all short-run AC curves
Related Questions
Increasing returns is not caused by:
Specialization of labor
Technological advancement
Marketing economics
Varying factor proportions
The standard form of demand function is:
Q = a- bP
Y = a- bP
Q = a+ bP
The number of firms in monopolistic competition normally range between:
14 to 28
14 to 80
14 to 38
14 to 60
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
In long run, a firm can change:
Fixed factors
Variable factors
Both of them
None of them
In respect of which of the following category of goods is consumers surplus highest?
Giffen goods
Necessities
Luxuries
Prestige goods
As the price of diamond is higher, so it has:
Higher marginal valuation for consumer
Lower marginal cost for producer
Higher marginal cost for producer
Both (a) and (c)
Selling costs are incurred under monopolistic competition to:
Attract more customers
Prevent its customers from going to others
Establish superiority of its product on the others
All of the above
If both demand and supply were to increase then:
Quantity exchanged would fall and price would rise
Quantity exchanged and price would both fall
Quantity exchanged would rise and price might rise or fall
Quantity exchanged and price would both rise
The Modern and Neo-Keynsian Theory of Interestwas presented by:
Gunner Myrdal
A.C.Pigou
J.M.Keynes
J.R.Hicks
Income-demand curve shows:
Income-expenditure relationship
Income-cost relationship
Income-price relationship
Income-quantity relationship
In dominant price leadership model, the dominant firm set the:
price
output
both a and b
none of the above
Price elasticity of demand is best defines as:
Change in the tastes of consumers at different prices
The rate of response of demand to a change in supply
The change in costs when output is increased by one unit
The responsiveness of demand to a change in price
Marginal Utility (MU) curve is always:
Rising
Falling
Parallel to X-axis
Parallel to Y-axis
In the case of a normal goods, the income effect:
Is always equal to the substitution effect
Completely offsets the substitution effect
Partially offsets the substitution effect
Reinforces the substitution effect
In constant sum game (zero sum game), if there are two parties then:
Both parties make better-off
Both parties make worse-off
Both parties become Neutral
One party can become better off only if another is made worse off
Ceteris paribus clause in the law of demand means:
The price of substitute does not change
The taste of the consumer does not change
The income of the consumer does not change
All of the above
The relationship between price effect, income effect and substitution effect is:
P.E = S.E + I.E
S.E = P.E +I.E
I.E = P.E +S.E
S.E = P.E +2I.E
Price-taker firms:
Advertise to increase the demand for their product
Do not advertise, because most advertising is wasteful
Do not advertise because they can sell as much as they want at the current price
Who advertise will get more profits than those who do not
A dominant strategy can best be described as:
A strategy taken by a dominant firm
A strategy taken by a firm in order to dominate its rivals
A strategy that is optimal for a player no matter an opponent does
A strategy that leaves every player in a game better off
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
The law of demand is most directly a result of:
The law of comparative advantage
The law of diminishing returns
The principle of substitution
Economics of large scale production
The slope of isocost line (budget line) shows:
Capital labor ratio
Labor wage ratio
Factor price ratio
Factor labor ratio
The feasible part of the demand curve for the monopolist who is charging high price will be:
The elastic part of a demand curve
The inelastic part of a demand curve
The constant elastic part of the demand curve
None of the above
Market allocation fundamentally relies upon:
A system of relative prices
A belief that employees work for the good of society
Government ownership of the means of production
Moral incentives to encourage productive efficiency
The Strategy of Economic Development is the work of:
S.Kuznets
H.Liebenstein
A.O.Hirshman
Alfred Marshal
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
The falling part of total Utility (TU) curve shows:
Increasing marginal utility
Decreasing marginal utility
Zero marginal utility
Negative marginal utility
In monopoly, the relationship between average revenue and marginal revenue curves is as follows:
Average revenue curve lies above the marginal revenue curve
Average revenue curve coincides with the marginal revenue curve
Average revenue curve lies below the marginal revenue curve
Average revenue curve is parallel to the marginal revenue curve
Abstinence or Waiting theory of Interest was presented by:
Lord Keynes
J.S.Mill
Alfred Marshal
Prof.Senior