To calculate the elasticity of demand, which of the following formula is used?:
Percentage change in demand Original demand
Proportionate change in demand Proportionate change in price
Change in demand Change in price
None of the above
Correct Answer :
B. Proportionate change in demand Proportionate change in price
Related Questions
Identify the work of T.W.Schultz:
Transforming Traditional Agriculture
Productivity and Technical Change
Jobs, Poverty and the Green Revolution
Causes of Poverty
If, at the prevailing price, more of a good is desired than is available for sale:
The price is below equilibrium
The price is at equilibrium
The price must fall
We cannot tell anything about the price
A market demand schedule is obtained by adding individual demand schedules:
Horizontally
Vertically
Permanently
Perpetually
Monopoly means:
Where there is no retail trade and every thing is sold on wholesale basis
Where trading of a particular commodity is controlled exclusively by one firm
Where many people sell only one commodity
A form of business organization in which only single proprietorship exists
Because the price elasticity of demand for OPEC oil is approximately .08, in order to increase revenues OPEC should:
Lower price in order to increase revenues
Lower price in order to decrease the amount of oil sold
Rise price in order to increase the amount of oil sold
Raise price in order to increase revenues
When at a given price, the quantity supplied of a commodity is more than the quantity demanded, there will be:
An upward pressure on price
A downward pressure on price
Price will remain unaffected
All of the above
The isoquant which are generated by CES (constant elasticity of substitution) production function are always:
Positively sloped
Negatively sloped
Concave to the origin
None of the above
If the commodity is normal then Income Effect (I.E) is:
Negative
Positive
Zero
Infinite
In substitution effect and income effect:
The substitution effect is more certain
The income effect is more certain
The substitution effect is uncertain
The income effect is always positive
To get more revenue, a Finance Minister impose tax on that commodity which has:
Inelastic demand
Elastic demand
Unit elasticity
Zero elasticity
When was Adam Smiths major work An Enquiry into the Nature and Causes of Wealth of Nations published?
1756
1777
1776
1801
The external economies of scale experienced by a firm include the:
Growth of firms processing its waste materials
Development of research bureau serving the industry
Supply of suitable skilled labor in the area
All of the above
The engineering production function and engineering costs curves are concerned with the:
Production cost
Collection cost
Raw material costs
Distribution costs
The act of producing the output from more than one plant is concerned with:
Monopoly
Multi-plant monopoly
Bilateral monopoly
Price discrimination
A country is advised to devalue (reduce external value of) its currency only when its exports face:
Inelastic demand in foreign markets
Elastic demand in foreign markets
Unit elastic demand in foreign markets
None of the above
According to Marshal, the Law of Diminishing Returns is applicable to:
Industry
All fields of production
Agriculture
None of the above
If a commodity sold under monopoly is got free of cost, then MC will be:
Zero
Identical with the MR
A horizontal straight line
Infinite
Who wrote An Introduction to Positive Economics?
R.G.Lipsey
Paul.A.Samuelson
E.D.Domar
J.M.Keynes
When total product falls:
MP is positive
MP is negative
MP is falling
MP is rising
Equilibrium of a discriminating monopolist requires the fulfillment of which one of the following conditions?
It must be profitable to him to sell output in more than one market
Marginal revenue in both markets must be the same
Marginal revenue in both markets must also be equal to the marginal cost of producing the monopolists aggregate output
All the above
If by doubling all inputs in the long run output is less than double, it is a case of:
Increasing returns to scale
Decreasing returns to scale
Constant returns to scale
Variable returns to scale
Abstinence or Waiting theory of Interest was presented by:
Lord Keynes
J.S.Mill
Alfred Marshal
Prof.Senior
The normal long-run average cost curve is influenced by the:
Principle of diminishing returns
Economies and diseconomies of large scale production
Principle of constant return to scale
All of the above
The optimum level of output in long run takes place where:
LAC = LMC
SAC = LMC
SAC =MC
SAC =LAC
The utility function u = f(x) is based upon :
Two goods
Few goods
One good
Zero goods
A monopolist is:
Price winner
Price searcher
Price taker
Price leaver
In centralized cartel, the firms are like:
Price takers
Price setters
Price discriminators
None of the above
Which of the following is not a property of indifference curve?
Convex to the origin
Slopes downwards to the right
Parallel to each other
Cannot intersect each other
Demand is consumers:
Ability to get a commodity
Willingness to get a commodity
Willingness and ability to get a commodity
Desire for a commodity
Average Revenue means:
Per unit revenue received from all the units sold by the producer
Revenue of the units having average size
Total number of units× Revenue per unit
Total revenue × Number of units sold