The optimum level of output in long run takes place where:
LAC = LMC
SAC = LMC
SAC =MC
SAC =LAC
Correct Answer :
D. SAC =LAC
Related Questions
There is no difference between fixed and variable factors in the:
Long run
Short run
Average run
None of the above
In the case of an inferior commodity, the income-elasticity of demand is:
Positive
Unitary
Negative
Infinity
The maximization of output subject to cost requires equilibrium at the:
Lowest isoquant
Lowest isocost line
Highest isoquant
Highest isocost line
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
The long run average cost curve is the envelope of:
SACs
LACs
SMCs
LMCs
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
The marshallian demand curve includes:
Substitution Effect
Income Effect
Both substitution and income effect
None of them
Cardinal approach includes arranging:
The different combinations of X and Y higher and lower without actually measuring the difference of utility between them
The different combinations of X and Y higher and lower and measuring the difference of utility between them
Different combination of X, Y and Z
None of above
When AC curve falls, MC curve falls:
More than AC curve
Less than AC curve
Equal to AC curve
None of the above
In case of monopoly, when total revenue is maximum:
MR is positive
MR falls
MR rises
MR is zero
In Nash Equilibrium:
Each player has a dominant strategy
No players have a dominant strategy
At least one player has a dominant strategy
Players may or may not have dominant strategies
A firms profit is equal to:
R-C
R>C
R
R=C
By increasing the price of its products above those of its competitors, a perfectly competitive seller:
Can sell more
Reduces its revenues
Can sell nothing
Increases its revenues
Nash equilibrium is applicable in case of:
Cournot model
Edgeworth model
Chamberline model
Sweezy model
Supply of a commodity refers to:
Total stock of a commodity in the market
Total production of a commodity during the year
Total production plus total stock of a commodity
Amount of commodity offered for sale at some price at a particular place and time
With which of the following concepts is the name of J.M.Keynes particularly associated?
Marginal propensity to consume
Marginal propensity to save
Liquidity preference
All of the above
The production function of homogeneous of degree one (n=1) is also called:
Linearly homogeneous
Zero homogeneous
Infinite homogeneous
None of the above
A firm under perfect competition has:
An AR curve which is a horizontal straight line
An AR curve which slopes downward
An AR curve which has a kink
An AR curve shape of which cannot be predicted
The Modern and Neo-Keynsian Theory of Interestwas presented by:
Gunner Myrdal
A.C.Pigou
J.M.Keynes
J.R.Hicks
Each firm in cournot model assumes that its competitor will:
change its output
not change its output
change its price
not change its price
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
In arriving at stable equilibrium in cournot model, if one firm decreases output the other firm will:
Also decrease it
Increase it
Remain uneffected
None of the above
Loanable funds theory of Interest was developed by:
Wicksell
Robert San
Ruskin
J.B.Say
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
In context of oligopoly, the kinky demand curve (kinked demand curve) hypothesis is designed to explain:
Price and output determination
Price rigidity (price stickness)
Price leadership
Collusion among rivals
The production function can convey to a firm:
The cost of producing any given output
The various combinations of input that could be employed in production of any given quantity of output
The various combinations of input that should be used in producing any given quantity of output in an efficient manner
The maximum profit level of output
The firm in cournot model:
face costs
face taxes
donot face taxes
donot face costs
Elasticity of Substitution (s) is defined as:
Percentage change in capital-labor ratio dividing by percentage change in 
Percentage change in dividing by percentage change in capital-labor ratio
Percentage change in inputs dividing by percentage change in outputs
None of the above
The Law of Proportionality is another name of:
The law of diminishing marginal utility
The law of demand
The Law of Diminishing Returns
The law of supply
Other things remaining the same, when a consumers income increases his equilibrium point moves to:
A lower indifference curve
A lower PPC curve
Remains on same indifference curve
A higher indifference curve