Which of the following pairs of commodities is an example of substitutes?
Tea and sugar
Tea and coffee
Pen and ink
Shirt and trousers
Correct Answer :
B. Tea and coffee
Related Questions
Which of the following would be least likely to cause a consumer to eat less beef?
An increase in the price of beef
An increase in the price of lamb
A reduction in the consumers income
A reduction in the price of lamb
Each firm in cournot model can:
not ignor the activities of the rival
ignor the activities of the rival
both a and b
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
Identify the author of The Social Framework:
R.G.D.Alien
J.R.Hicks
A.C.Pigou
None of the above
The largest possible loss that a firm will make in the short run is:
Zero
Its total fixed cost
Its total variable cost
Equal to one
The ordinal approach was presented by:
Marshal
J.R.Hicks
Adam smith
Rostow
In perfectly competitive markets, the profit maximization rule can be represented by:
MR=ATC
P=ATC
P=MC
P=AC
The firms in non-cooperative games:
Enforce contracts
Make contracts
Make negotiations
Do not make negotiations
In the long-run:
Fixed cost will be greater than variable cost
Variable costs will be greater than fixed costs
All costs are variable costs
All costs are fixed costs
Ordinal approach includes arranging:
The different combinations of X and Y in any way the consumer wants
The different combinations of X and Y higher and lower and measuring the difference of utility between them
The different combinations of X and Y higher and lower and not measuring the difference of utility between them
None of above
The CES production function shows:
Decreasing return to scale
Increasing return to scale
Constant return to scale
None of the above
A market demand curve presumes that:
All consumers are alike
Incomes of all consumers is the same
Tastes of all consumers are the same
Consumers differ in taste, incomes and other matters
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
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
To calculate the Economic Profit we must deduct which of the following cost from our total revenues?
Opportunity cost
Direct cost
Rent cost
Wage cost
Which form of market structure is characterized by interdependence in decision-making as between the different competing firms?
Oligopoly
Perfect competition
Imperfect competition
None of the above
The longer the period of time, the elasticity of supply will be:
Constant
Less elastic
More elastic
Perfectly elastic
The elasticity of demand is equal to slope of demand function divided by:
Average demand function
Qualified demand function
Constructive demand function
Relative demand function
A loss bearing firm will continue to produce in the short run so long as the price at least covers:
Average variable cost
Average fixed cost
Average variable cost + average fixed cost
Marginal costs
The Hicksian indirect utility function in the form of equation is:
x =f(P)
x =a-bp
When a consumer is satisfied with his spending pattern, he is said to be in:
Balance stat
Equilibrium
Disequilibrium
Authenticated form
Rotten eggs are:
Free goods
Economic goods
Luxury goods
None of the above
Utility is:
A subjective concept
An ethical concept
An objective concept
A historical concept
The marginal revenue of a perfectly competitive firm is:
Equal to the prices of its products
Positively related to output
Negatively related to output
Always higher than marginal cost
Identify the work of T.W.Schultz:
Transforming Traditional Agriculture
Productivity and Technical Change
Jobs, Poverty and the Green Revolution
Causes of Poverty
The equilibrium of a firm is determined by the equality of MC and MR in only:
Under perfect competition
Under monopoly
Under imperfect competition
Under all the above market forms
Income-demand curve shows:
Income-expenditure relationship
Income-cost relationship
Income-price relationship
Income-quantity relationship
Abstinence or Waiting theory of Interest was presented by:
Lord Keynes
J.S.Mill
Alfred Marshal
Prof.Senior
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
Indifference curve approach (ordinal approach) is superior to utility approach (cardinal approach) because:
In ordinal approach we can separate the income effect from the substitution effect of a price change
In ordinal approach we can study the consumer behavior more closely
In ordinal approach the consumer is assumed more rational
In ordinal approach the consumer has more income