When elasticity of demand is one (e=1), then following the formula MR=P[1-1/e], the MR will:
Positive
Negative
Zero
None of the above
Correct Answer :
C. Zero
Related Questions
An exceptional demand curve is:
Downward sloping
Upward sloping
Horizontal straight line
Vertical straight line
The critics of Sweezy model say that kink generates:
Frustration
Poverty
Uncertainty
Integrity
Which of the following formula determine the income elasticity of demand?:
Proportionate change in demand Proportionate change in price
Proportional change in the purchase of Y Proportional change in the price of X
Proportionate change in demand Proportionate change in income
Proportionate change in demand Proportionate change in price
Micro economics is concerned with:
Product markets
Factor markets
Supply and demand
a, b and c
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
In arriving at stable equilibrium in cournot model, if one firm decreases output the other firm will:
Also decrease it
Increase it
Remain uneffected
None of the above
In dominant price leadership model, the small firms are like:
monopolistic firms
monopoly
competitive firms
none of the above
If the supply and demand increases equally, the price will:
Rise
Fall
Remain unchanged
Change depending on respective elasticities
7.In an economy based on the price system the decision on what shall be produced is made by:
Government
Consumer
Producer
Stock holder
An optimum level of a firms output is:
Where marginal cost is minimum
Where average cost is minimum
Where both the marginal and the average cost curves are at their respective minimum
Where the firm earns the maximum profits
The modern cost curves are based upon the idea of:
Fixed capacity
Specific capacity
Excess capacity
Reserve capacity
According to Marshallian approach, utility:
Can be added
Can be subtracted
Can be multiplied
Can be divided
At a point where a straight line demand curve meets the price axis (Y-axis), the elasticity of demand is:
Equal to one
Less than one
Equal to zero
Equal to infinite
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
Cross-elasticity of demand or cross-price elasticity between two substitutes will be:
Negative
Positive
Infinite
Zero
The horizontal demand curve for a commodity shows that its demand is:
Highly elastic
Perfectly inelastic
Perfectly elastic
Zero elastic
On a straight line demand curve, elasticity of demand at the midpoint is:
Equal to zero
Equal to one
Equal to infinity
More than one
The slope of an iso-quant represents:
MRS
MRT
MRTS
MRPS
In Prisoner Dilemma, the best choice of strategy is:
Stable
Unstable
Negative
Neutral
All the firms with identical costs under perfect competition well, in the long-run, earn only:
Normal profits
Abnormal profits
Differential profits
No profits
In monopolistic competition, the firms face:
Horizontal demand curve
Vertical demand curve
Similar demand curve
Differential demand curve
In finding equilibrium position of a profitmaximizing firm, which technique is most convenient?
Total revenue and total cost technique
Marginal revenue and marginal cost technique
Demand and supply technique
None of the above
Price effect occurs on the higher IC in case of:
Slutsky approach
Hicksian approach
Marshallian approach
None of the above
Income effect operates through an increase
In nominal income
In money income
In wages
In real income because of the fall of price of a commodity
In dominant price leadership model, the dominant firm set the:
price
output
both a and b
none of the above
Production function relates:
Cost to input
Wages to profits
Cost to output
Inputs to output
The total revenue curve for monopolist is the shape of:
Circle
Rectangle
Parabola
None of the above
In monopoly, the relationship between average revenue and marginal revenue curves is as follows:
Average revenue curve lies above the marginal revenue curve
Average revenue curve coincides with the marginal revenue curve
Average revenue curve lies below the marginal revenue curve
Average revenue curve is parallel to the marginal revenue curve
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
Quantity demanded or supplied is measured in:
Monetary units
Physical units
Relative units
Constant units