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4

Under the law of variable proportions, the average and the marginal product of the variable factor would ultimately:

A. Become equal

B. Decrease

C. Become constant

D. Increase

Correct Answer :

B. Decrease


Related Questions

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The situation of single buyer and single seller is called:

A. Monopoly

B. Multi-plant monopolist

C. Bilateral monopoly

D. Price discrimination

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In cournot model, at equuilibrium when MC = MR, the elasticity of demand is:

A. equal to one

B. zero

C. negative

D. equal to 2

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The reaction curve of a firm is attained by joining the:

A. Isoprofit curve

B. Super profit curve

C. Normal profit curve

D. Indoprofit curve

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4

The concept of industry in monopolistic competition has been replaced by:

A. Firm

B. Product group

C. Producers

D. Shopkeepers

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Which form of market structure is characterized by interdependence in decision-making as between the different competing firms?

A. Oligopoly

B. Perfect competition

C. Imperfect competition

D. None of the above

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4

The slope of isocost line (budget line) shows:

A. Capital labor ratio

B. Labor wage ratio

C. Factor price ratio

D. Factor labor ratio

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4

A firm is a sum of persons who convert:

A. Goods into services

B. Output into inputs

C. Inputs into outputs

D. None of the above

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4

The study of economics just in theoretical way is called:

A. Positive Economics

B. Normative Economics

C. Micro Economics

D. Development Economics

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The equilibrium conditions, MC = MR = AR = AC, will happen:

A. In the short-run under perfect competition

B. In the long-run under perfect competition

C. In the short-run under monopolistic competition

D. In the long-run under monopolistic competition

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4

A shift in the demand for a product is likely to result from a change in:

A. The products price

B. Expectations

C. The prices of factors of production used to produced it

D. Production technology

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A monopolist will fix the equilibrium output of his product where the elasticity of his average revenue curve is:

A. Less than one

B. Equal to one

C. Greater than one

D. Less than one

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4

The demand curve slopes downwards due to:

A. Income effect(I.E)

B. Substitution effect(S.E)

C. Taste effect

D. Both a and b

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4

Law of Returns to Scale shows:

A. Technical relationship between input of a variable factor and the resulting output

B. Any economic relationship between input and output

C. An output maximizing relationship

D. A relationship with input changing and corresponding changes in output

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The budget-line is also known as the:

A. Iso-utility curve

B. Production possibility line

C. Isoquant

D. Consumption possibility line

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Elasticity of Substitution (s) is defined as:

A. Percentage change in capital-labor ratio dividing by percentage change in

B. Percentage change in dividing by percentage change in capital-labor ratio

C. Percentage change in inputs dividing by percentage change in outputs

D. None of the above

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4

A price is a ratio of exchange between:

A. Money and exchange

B. Quantity and production

C. Production and consumption

D. Money and quantity

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4

Which of the following is the work of A.C.Pigou?

A. Economics of Welfare

B. Commerce and Trade

C. Industrial Economics

D. None of the above

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Other things remaining the same, when a consumers income increases his equilibrium point moves to:

A. A lower indifference curve

B. A lower PPC curve

C. Remains on same indifference curve

D. A higher indifference curve

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Variable costs refer to:

A. Capital cost plus operating costs

B. Capital costs alone

C. Capital costs plus spill-over costs

D. Operating costs alone

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According to Marginalists, the price of any commodity is determined by:

A. Marginal usefulness

B. Marginal cost

C. Both of them

D. None of them

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If the commodity is normal then price effect is:

A. Negative

B. Inverse

C. Positive

D. Both (a) and(b)

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If a new production technology for producing compact discs is developed and new firms are attracted to this field:

A. The supply curve will shift down or right

B. The supply curve will shift up or left

C. Both demand and supply curve shifts would occur

D. None of the above

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The expansion point is attained by joining:

A. Similar optimal combinations

B. Different optimal combinations

C. Both of them

D. None of them

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4

Marginal utility equals:

A. Slope of total utility curve

B. Slope of average utility curve

C. Slope of marginal utility curve

D. Slope of total revenue curve

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Which of the following would be least likely to cause a consumer to eat less beef?

A. An increase in the price of beef

B. An increase in the price of lamb

C. A reduction in the consumers income

D. A reduction in the price of lamb

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4

Scarcity is:

A. A relative term

B. An economic term

C. A dynamic term

D. As a whole term

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Neutral Technological Progress can be defined as:

A. Technological progress that causes to raise the marginal product of capital and labor in the same proportion

B. Technological progress that causes the marginal product of capital to increase relative to the marginal product of labor

C. Technological progress that causes the marginal product of labor to increase relative to the marginal product of capital

D. None of the above

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The Purchasing Power Parity (PPP) Theory is presented by:

A. J.M.Keynes

B. E.D.Domar

C. Adam Smith

D. Gustav Cassel

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In monopolistic competition, the cost curves of all firms are:

A. Uniform

B. Different

C. Dependent

D. Independent

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External economies are witnessed in:

A. A rising supply curve

B. A rising demand curve

C. A falling supply curve

D. A falling demand curve