Under competitive conditions, the industry will be in equilibrium:
When each firm is in equilibrium equating MC with MR
When all the firms are earning only normal profits
When firms outside have no tendency to enter the industry and those within, have no tendency to leave the industry
All of the above
Correct Answer :
B. When all the firms are earning only normal profits
Related Questions
Cross-elasticity of demand is measured as:
Percentage change in the quantity of a commodity demanded divided by the percentage change in the price of that commodity
Percentage change in the quantity of commodity X divided by percentage change in the price of commodity Y
Percentage change in the quantity demanded of commodity X
Percentage change in the quantity demanded of commodity X divided by percentage change in the quantity demanded of commodity Y
There is no difference between fixed and variable factors in the:
Long run
Short run
Average run
None of the above
Theory of revealed preference is based on:
Weak orderings
Neutral orderings
Partial orderings
Strong orderings
Excess capacity is concerned with the:
V-shaped traditional cost curves
S-shaped traditional cost curves
Modern cost curves
U-shaped traditional cost curves
When a competitive firm is in equilibrium in the long-run, its output is such that:
Costs per unit of output are lowest
Total profits are highest
Marginal cost is lowest
Profit per unit of output is zero
In case of budget line, we get pairs of two goods where consumers income is:
Fully spent
Half spent
Partially spent
Correctly spent
Who is the author of the famous work Asian Drama: An Enquiry intro the Causes of Poverty of Nations?
Irving Fisher
J.B.Clark
J.M.Keynes
Gunnar Myrdal
When total product increases at a decreasing rate:
MP = AP
MP < AP
MP > AP =0
MP > AP
When elasticity of demand is greater than one (e >1), then following the formula MR=P[1-1/e], the MR will:
Positive
Negative
Zero
None of the above
In long run, a firm can change:
Fixed factors
Variable factors
Both of them
None of them
The imaginary differentiation is attributed to difference in:
Style
Salesmanship
Locality
All of these
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
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
Cross-elasticity of demand or cross-price elasticity between two complements will be:
Negative
Positive
Infinite
Zero
Supply curves are most elastic:
In the long-run
In the short-run
For luxuries
In the immediate-run
A firm is a sum of persons who convert:
Goods into services
Output into inputs
Inputs into outputs
None of the above
Traditionally, the study of determination of price is called:
Theory of price
Theory of value
Theory of labor
Theory of cost
The Chamberline model recognizes mutual:
Independence of firms
Interdependence of firms
Independence of individuals
Interdependence of materials
In the case of an inferior commodity, the income-elasticity of demand is:
Positive
Unitary
Negative
Infinity
The total utility (TU) curve is:
Concave to X-axis
Convex to X-axis
Concave to Y-axis
Convex to Y-axis
In case of monopoly:
MR
MR>AR
MR=AR
AR=0
Income distribution effects:
The price of complements
The price of substitutes
The market demand for commodities
The individuals scale of performances
Who is the author of Choice of Technique?
K.N.Raj
Amartiya Sen
A.C.Pigou
Alfred Marshal
The alternative of profit maximization theory is:
Cost maximization
Product maximization
Revenue maximization
None of the above
An economic theory is :
An axiom
A proposition
A hypothesis
A tested hypothesis
When was Adam Smiths major work An Enquiry into the Nature and Causes of Wealth of Nations published?
1756
1777
1776
1801
If the increase in demand is more than the increase in supply, the price will:
Rise
Fall
Remain the same
None of the above
In which case the elasticity shown by the different points of a curve is the same?
A straight line curve
A downward sloping demand curve
A rectangular hyperbola demand curve
None of the above
Utility means:
The want- satisfying power of a commodity
Usefulness of commodity
Eating of commodity
None of these
Which of the following is assumed to be constant when a supply curve is drawn:
Technology
Number of buyers in the market
Consumer income
Household tastes