Under perfect competition, at equilibrium, marginal cost is:
Less than marginal revenue
Equal to marginal revenue
More than marginal revenue
None of the above
Correct Answer :
B. Equal to marginal revenue
Related Questions
A profit-maximizing monopolist in two separate markets will:
Charge the same price in both markets
Always charge a higher price in the market where he sells more
Always charge a higher price in the market where he sells less
Adjust his sales in the two markets so that his marginal revenue in each market just equals his aggregate marginal cost
We can find total utility by:
Multiplying the number of unit by its marginal utility
Adding up the marginal utility of all units
Multiplying price by number of units
None of the above
The cost curves of the firm shift due to changes in:
Input prices
Technological innovations
Both of them
None of them
The situation in between the extremes of the govt. controlled, planned economy and the perfectly free, unplanned economy is known as:
Developed economy
Laissez-fair economy
Mixed economy
Capitalistic economy
In 1932, The nature and significance of economic science was written by:
Prof. Adam Smith
Prof. Alfred Marshal
Prof. Robbins
J.S.Mill
If the price of a product falls which of the following would occur?
Indifference curves shift down
Budget line shifts down
Indifference curve shift up
Budget line pivots
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
Law of Diminishing Marginal Utility is practically untrue because:
It is given to a lot of criticism
It is too difficult to be explained
It is based on assumptions which are unreal
Economists do not agree on this
If cross-elasticity of one commodity for another turns out to be zero, it means they are:
Close substitutes
Good complements
Completely unrelated (independent goods)
None 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
Which cost increases continuously with the increase in production?
Average cost
Marginal cost
Fixed cost
Variable cost
With elasticity of demand, the:
Negative sign is ignored
Positive sign is ignored
None of them
Both of them
The effect of consumer boycotts usually is:
A rise in the price of the product
A decrease in the demand for the product
A decrease in the supply of the product
An increase in the quantity supplied of the product
A firm enjoys maximum control over the price of its product under:
Monopoly
Perfect competition
Oligopoly
Imperfect competition
In price leadership, like leader, the follower firm may:
also maximize its profits
not maximize its profits
maximize its costs
none of the above
The supply curve would probably shift to the right if:
Resource( factors of production) used in production became more costly
The technology of production improves
Consumers income increased
Some sellers left the market
A monopolist will fix the equilibrium output of his product where the elasticity of his average revenue curve is:
Less than one
Equal to one
Greater than one
Less than one
The number of sellers in oligopoly is:
Two
One
Very large
A few
The difference between average cost and average revenue is:
Total profit
Average profit
Net profit
Marginal profit
An increase in the price of the good measured on the horizontal axis causes:
The budget line to get steeper
The budget line to shift parallel to the right
The indifference curve to shift up
The budget line to get flatter
The budget constraint equation of the firm is:
If the factors have to be employed in a fixed ratio, then the elasticity of substitution under Leontief technology is:
One
Zero
Two
Five
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
In a competitive market, price is determined primarily by:
Transportation costs
The interplay of demand and supply
Costs of production
The marginal product of labour
The products, under monopolistic competition are differentiated, yet they are:
Complements
Close substitutes
Both a and b
None of the above
In dominant strategies I am doing the best, I can no matter:
What you do
What you are doing
What you not do
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
In perfectly competitive markets, the profit maximization rule can be represented by:
MR=ATC
P=ATC
P=MC
P=AC
According to Marginalists, the price of any commodity is determined by:
Marginal usefulness
Marginal cost
Both of them
None of them
In real life firms:
Loss because of past
Learn from past
Destroy because of past
None of the above