Total profits are maximized at the point where:
TR equals TC
The TR curve and the TC curve intersect such that TR and TC lie at the same point
The TR curve and the TC curve are parallel and TC exceeds TR
The TR curve and the TC curve are parallel and TR exceeds TC
Correct Answer :
D. The TR curve and the TC curve are parallel and TR exceeds TC
Related Questions
The necessary condition of firms equilibrium requires:
dR/dQ + dC/dQ = 0
dR/dQ - dC/dQ = 0
dC/dQ - dR/dQ = 0
dR/dQ > dC/dQ > 0
Money spent by a firm on the purchase of capital equipment is:
Fixed cost
Variable cost
Both fixed and variable costs
None of the above
MC = MR = AC = AR shows the long run equilibrium position of the:
Competitive firm
Oligopolistic firm
Monopolist firm
None of the above
LMC represents change in LTC (long-run total cost) due to producing an additional unit of a good while the fixed and variable factors:
Cannot be changed
Can be changed
Can partially be changed
None of the above
The substitution effect works to encourage a consumer to purchase more of a product when the price of that good is falling because:
The consumers real income has increased
The consumers real income has decreased
The product is now relatively less expensive than before
Other products are now less expensive than before
When SAC curve rises, SMC curve lies its:
Below
Above
Equal level
None of the above
The isoquant approach is based upon:
One output
One input
Two outputs
Two inputs
AR curve under perfect competition:
Slopes downwards to the right
Slopes upward to the right
Is vertical to the x-axis
Is horizontal to the x-axis
The combination of labor and capital where the cost of a given output is minimized is known as:
Least cost factor combination
Optimum factor combination
Both a and b
None of them
If the commodity is inferior then the Income Effect (I.E) and the Substitution Effect (S.E):
Both move together and reinforce each other
One moves and the other remains constant
Move in the opposite direction and neutralize each other
Both remain constant
The factors of production in perfect competition are:
Stagnant
Mobile
Immobile
Rare
Who wrote Mathematical Analysis for Economists?
J.P.Lewis
R.G.D.Allen
Paul A.Samuelson
E.D.Domar
Supply and demand changes have their most rapid impact in:
Auction market
Contract markets
Market for commercial office space
Natural gas market
The production function of homogeneous of degree one (n=1) is also called:
Linearly homogeneous
Zero homogeneous
Infinite homogeneous
None of the above
The average cost curve is a geometrical illustration of:
Hydraulic function
Cubic function
Pentagonic function
Quadratic function
In monopolistic competition, the customers are attached with one product because of:
Product similarity
Product differentiations
Product inferiority
None of the above
In real life firms:
Loss because of past
Learn from past
Destroy because of past
None of the above
The cost of firms in cournot model are:
identical
differential
very high
very low
Demand is elastic when the coefficient of elasticity is:
greater than zero
less than one
greater than one
less than one
A producer attains the least cost combination when the relation between Marginal Rate of Technical Substitution (MRTS) and price (P) of the factors x and y is:
According to Marginalists, the price of any commodity is determined by:
Marginal usefulness
Marginal cost
Both of them
None of them
According to current thinking, the law of diminishing returns applies to:
All fields of production
Agriculture
Mining
Manufacturing
In a perfectly competitive market, suppliers must know:
The incomes of consumers
The price of the good
What other commodities households could substitute for the good
Consumers expectations of the future
If Marginal Utility (MU) is zero, then total utility is:
Maximum
Minimum
Infinite
Not measureable
Rational economic behavior on the part of the consumer means that he will:
Save as much of his income as possible
Spend as much of his income as possible
Buy everything at the lowest possible price
Make wise choices among available economic goods
Which of the following pairs of commodities is an example of substitutes?
Tea and sugar
Tea and coffee
Pen and ink
Shirt and trousers
The cost of one thing in terms of the alternative given up is known as:
Production cost
Physical cost
Real cost
Opportunity cost
In Bertrand model, the entry of new firms is:
banned
allowed
partially allowed
none of the above
The budget constraint can be written as:
X.PX + Y.PY = 1
X.PX + Y.PY < 1
X.PX + Y.PY > 1
X.PX + Y.PY = 0
The slope of indifference curve shows:
Income level
Satisfaction level
Marginal rate of substitution
Demand level