Explicit cost refers to (a) Actual expenses of the firm to purchase or hire input it needed (b) Actual and notional expenses of the firm to purchase or hire input it needed (c) Notional expenses of the firm to purchase or hire input it needed ; (d) All the three

Explicit cost refers to (a) Actual expenses of the firm to purchase or hire input it needed (b) Actual and notional expenses of the firm to purchase or hire input it needed (c) Notional expenses of the firm to purchase or hire input it needed ; (d) All the three
by

1 Answer

Answer :

(a) Actual expenses of the firm to purchase or hire input it needed 
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Implicit cost refers to ……………… (a) Value of inputs owned by the firm and used in its own manufacturing process (b) Value of input or services purchased from outside and used in its own manufacturing process ; (c) Value of inputs owned by the firm and sold to others ; (d) Value of inputs or services for which no payments were made to outside

Description : Implicit cost refers to (a) Value of inputs owned by the firm and used in its own manufacturing process (b) Value of input or services purchased from outside and used in its own manufacturing ... and sold to others ; (d) Value of inputs or services for which no payments were made to outside 

Last Answer : (d) Value of inputs or services for which no payments were made to outside 

If the asset acquired outside India by a non-resident is brought by him to India & used for business, then in that case what shall be the cost of addition? a) Value of the asset at the time of bringing the asset to India less depreciation b) Actual cost of asset less actual depreciation c) Actual cost of asset less notional depreciation d) Any of the above

Description : If the asset acquired outside India by a non-resident is brought by him to India & used for business, then in that case what shall be the cost of addition? a) Value of the asset at the ... of asset less actual depreciation c) Actual cost of asset less notional depreciation d) Any of the above

Last Answer : c) Actual cost of asset less notional depreciation

Total profit of a firm in a perfect competitive market is – (a) Total revenue less total cost ; (b) Marginal revenue less marginal cost; (c) Total revenue less marginal cost ; (d) Total revenue less variable cost

Description : Total profit of a firm in a perfect competitive market is – (a) Total revenue less total cost ; (b) Marginal revenue less marginal cost; (c) Total revenue less marginal cost ; (d) Total revenue less variable cost

Last Answer : (a) Total revenue less total cost ;

For a monopoly firm market demand curve is (a) Marginal revenue curve itself ; (b) Average Revenue curve itself ; (c) Marginal cost curve (d) None

Description : For a monopoly firm market demand curve is (a) Marginal revenue curve itself ; (b) Average Revenue curve itself ; (c) Marginal cost curve (d) None

Last Answer :  (b) Average Revenue curve itself ;

Which of the following statement is true (a) In perfect competition Average and Marginal revenue are identical (b) In perfect competition Average and Marginal cost are identical (c) In perfect competition Average price and Marginal cost are identical (d) In perfect competition only normal profit can be earned by a firm

Description : Which of the following statement is true (a) In perfect competition Average and Marginal revenue are identical (b) In perfect competition Average and Marginal cost are identical (c) In perfect competition ... cost are identical (d) In perfect competition only normal profit can be earned by a firm

Last Answer : (a) In perfect competition Average and Marginal revenue are identical

Under perfect market conditions a firm is said to be in equilibrium where (a) Total output is equal to total demand ; (b) Profit is the maximum; (c) Where the total revenue is maximum ; (d) Where total average cost is the minimum

Description : Under perfect market conditions a firm is said to be in equilibrium where (a) Total output is equal to total demand ; (b) Profit is the maximum; (c) Where the total revenue is maximum ; (d) Where total average cost is the minimum

Last Answer : (b) Profit is the maximum; 

A competitive firm maximizes its total profit when ……………… (a) Average cost equal average realization ; (b) Marginal cost equals Price; (d) Total revenue is the maximum ; (d) MR = AR

Description : A competitive firm maximizes its total profit when ……………… (a) Average cost equal average realization ; (b) Marginal cost equals Price; (d) Total revenue is the maximum ; (d) MR = AR

Last Answer : (d) Total revenue is the maximum ;

In a pure monopoly firm a firm can make abnormal profit at the long run equilibrium level due to (a) Price discrimination;(b)Cost effectiveness ; (c) Banned entry of new firms ; (d) Sales promotion

Description : In a pure monopoly firm a firm can make abnormal profit at the long run equilibrium level due to (a) Price discrimination;(b)Cost effectiveness ; (c) Banned entry of new firms ; (d) Sales promotion

Last Answer : (c) Banned entry of new firms ;

The ideal level of operation for a pure monopoly firm is the level where (a) TR and STC curve are parallel to each other ; (b) TR = TC ; (c) TR = Total variable cost; (d) TR is less than STC

Description : The ideal level of operation for a pure monopoly firm is the level where (a) TR and STC curve are parallel to each other ; (b) TR = TC ; (c) TR = Total variable cost; (d) TR is less than STC 

Last Answer : (a) TR and STC curve are parallel to each other ; 

In the short run if the price is above the average total cost in a monopolistic competitive market, the firm makes (a) Profits and new firms join the market ; (b) Profit and bar entry to new firms; (c) Makes losses and exit the market ; (d) Quick profit and disappears

Description : In the short run if the price is above the average total cost in a monopolistic competitive market, the firm makes (a) Profits and new firms join the market ; (b) Profit and bar entry to new firms; (c) Makes losses and exit the market ; (d) Quick profit and disappears

Last Answer : (a) Profits and new firms join the market ;

When the price is less than the average variable cost, the firm should …………. (a) Continue to operate till the market recover ; (b) Shut down its operation for the time being (c) Retrench workers and pay them compensation; (d) Clear the existing stock at a price less than the prevailing price to beat the competitors

Description : When the price is less than the average variable cost, the firm should . (a) Continue to operate till the market recover ; (b) Shut down its operation for the time being (c) Retrench ... compensation; (d) Clear the existing stock at a price less than the prevailing price to beat the competitors

Last Answer :  (b) Shut down its operation for the time being

If a firm shut down at a level when AVC > Price, the firm restricts its losses to (a) Total fixed cost ; (b) Average fixed cost ; (c) Variable cost ; (d) Average variable cost

Description : If a firm shut down at a level when AVC > Price, the firm restricts its losses to (a) Total fixed cost ; (b) Average fixed cost ; (c) Variable cost ; (d) Average variable cost

Last Answer : (a) Total fixed cost ;

A firm faces the shut down situation when (a) Price is less than average variable cost ; (b) Price is more than the average variable cost (c) Price is equal to fixed cost ; (d) Price is more than the average fixed cost

Description : A firm faces the shut down situation when (a) Price is less than average variable cost ; (b) Price is more than the average variable cost (c) Price is equal to fixed cost ; (d) Price is more than the average fixed cost 

Last Answer : (a) Price is less than average variable cost ; 

The negatively sloped part of long run cost curve of a firm is due to (a) Increase in production due to specialization and division of labour; (b) Diseconomies of scale ; (c) Diminishing returns to scale ; (d) Marginal utility theory

Description : The negatively sloped part of long run cost curve of a firm is due to (a) Increase in production due to specialization and division of labour; (b) Diseconomies of scale ; (c) Diminishing returns to scale ; (d) Marginal utility theory

Last Answer : (a) Increase in production due to specialization and division of labour;

The positively sloped part of long run cost curve of a firm is due to (a) Economies of scale ; (b) Diseconomies of scale; (c) Diminishing returns to scale ; (d) Marginal utility theory

Description : The positively sloped part of long run cost curve of a firm is due to (a) Economies of scale ; (b) Diseconomies of scale; (c) Diminishing returns to scale ; (d) Marginal utility theory

Last Answer : (b) Diseconomies of scale;

Average Revenue of a monopolist firm is (a) Always more than the Marginal revenue ; (b) Always less than the Marginal revenue; (c) Equal to marginal revenue ; (d) Any of the above three possible

Description : Average Revenue of a monopolist firm is (a) Always more than the Marginal revenue ; (b) Always less than the Marginal revenue; (c) Equal to marginal revenue ; (d) Any of the above three possible

Last Answer : (a) Always more than the Marginal revenue ;

In the short run an oligopolistic firm will (a) Make profits ; (b) Incur losses ; (c) Just break even ; (d) Any of these three are possible

Description : In the short run an oligopolistic firm will (a) Make profits ; (b) Incur losses ; (c) Just break even ; (d) Any of these three are possible

Last Answer : (d) Any of these three are possible

While Computing the actual cost of any asset falling within a block, direct cost attributable to bring the asset to its present location and working condition for its intended use(i.e. expenses incurred for acquiring the asset e.g. freight, insurance, etc.) a) Be added to the purchase price b) Be subtracted from the purchase price c) Be subtracted from WDV d) Be claimed as revenue expenditure

Description : While Computing the actual cost of any asset falling within a block, direct cost attributable to bring the asset to its present location and working condition for its intended use(i.e. expenses incurred ... from the purchase price c) Be subtracted from WDV d) Be claimed as revenue expenditure

Last Answer : b) Be subtracted from the purchase price

Breakeven point refers to the situation when (a) Total revenue is equal to total cost ; (b) Total revenue is more than total cost (c) Total revenue is less than total cost ; (d) Total revenue is equal to total variable cost

Description : Breakeven point refers to the situation when (a) Total revenue is equal to total cost ; (b) Total revenue is more than total cost (c) Total revenue is less than total cost ; (d) Total revenue is equal to total variable cost

Last Answer : (a) Total revenue is equal to total cost ;

Law of returns to scale applies when……… (a) All inputs cost are variable ; (b) All input cost are fixed; (c) All cost are partly fixed and partly variable ; (d) None

Description : Law of returns to scale applies when……… (a) All inputs cost are variable ; (b) All input cost are fixed; (c) All cost are partly fixed and partly variable ; (d) None

Last Answer : (a) All inputs cost are variable ;

Marginal product is…………. (a) Rate at which total production changes with change in variable input; (b) Rate at which total production changes with change in total cost; (c) Rate at which total production changes with change in fixed cost ; (d) None

Description : Marginal product is…………. (a) Rate at which total production changes with change in variable input; (b) Rate at which total production changes with change in total cost; (c) Rate at which total production changes with change in fixed cost ; (d) None

Last Answer : (a) Rate at which total production changes with change in variable input; 

Law of variable proportion applies……………. (a) When all inputs are variable ; (b) When all input are fixed ; (c) Some inputs are fixed and some are variable ; (d) All the three

Description : Law of variable proportion applies……………. (a) When all inputs are variable ; (b) When all input are fixed ; (c) Some inputs are fixed and some are variable ; (d) All the three

Last Answer : (c) Some inputs are fixed and some are variable ; 

The demand curve of a Monopoly firm is – (a) Same that of a firm in a perfect competition ; (b) Same as that of the total market demand; (c) Non-exist ; (d) Perfectly elastic

Description : The demand curve of a Monopoly firm is – (a) Same that of a firm in a perfect competition ; (b) Same as that of the total market demand; (c) Non-exist ; (d) Perfectly elastic

Last Answer : (b) Same as that of the total market demand;

What will happen if a firm in perfect competitive market, increase its output by 50% (a)Total sales revenue will also increase by 50% ; (b) (b)Selling price will come down by 50%; (c)Total sales revenue will decrease by 50% ; (d)Profit will increase by 25%

Description : What will happen if a firm in perfect competitive market, increase its output by 50% (a)Total sales revenue will also increase by 50% ; (b) (b)Selling price will come down by 50%; (c)Total sales revenue will decrease by 50% ; (d)Profit will increase by 25%

Last Answer : (a)Total sales revenue will also increase by 50% ;

Which of the following statement is true (a) Monopolist are price takers ; (b) Monopoly firm earn abnormal profits; (c) A Monopoly firm faces straight demand line ; (d) Supply curve of a monopoly firm is positive sloped

Description : Which of the following statement is true (a) Monopolist are price takers ; (b) Monopoly firm earn abnormal profits; (c) A Monopoly firm faces straight demand line ; (d) Supply curve of a monopoly firm is positive sloped

Last Answer : (a) Monopolist are price takers ;

Demand curve of an Oligopoly firm is characterized by (a) Horizontal to X axis ; (b) Kink at the price ; (c) U shaped curve ; (d) A liner line

Description : Demand curve of an Oligopoly firm is characterized by (a) Horizontal to X axis ; (b) Kink at the price ; (c) U shaped curve ; (d) A liner line

Last Answer : (b) Kink at the price ;

Which of the following faces a downward sloping demand curve (a) Firm in a competitive market ; (b) Firm in a monopoly market ; (c) Both ; (d) None

Description : Which of the following faces a downward sloping demand curve (a) Firm in a competitive market ; (b) Firm in a monopoly market ; (c) Both ; (d) None

Last Answer : (b) Firm in a monopoly market ;

For a monopoly firm the MR Curve (a) Overlaps AR curve ; (b) Is above the AR curve ; (c) Lies half way between AR curve and the Y axis ; (d) Is same as AR curve

Description : For a monopoly firm the MR Curve (a) Overlaps AR curve ; (b) Is above the AR curve ; (c) Lies half way between AR curve and the Y axis ; (d) Is same as AR curve

Last Answer : (c) Lies half way between AR curve and the Y axis ;

Which of the following statement is true (a) For a monopoly firm AR can be zero (b) For a monopoly firm MR can be zero or even negative (c) For monopoly firm MR and AR are identical (d) For a monopoly firm MR and AR are positive sloped

Description : Which of the following statement is true (a) For a monopoly firm AR can be zero (b) For a monopoly firm MR can be zero or even negative (c) For monopoly firm MR and AR are identical (d) For a monopoly firm MR and AR are positive sloped

Last Answer : (b) For a monopoly firm MR can be zero or even negative 

Under perfect market conditions the supply curve of a firm is represented by (a) MC curve ; (b) MR curve ; (c) AR curve ; (d) AC curve

Description : Under perfect market conditions the supply curve of a firm is represented by (a) MC curve ; (b) MR curve ; (c) AR curve ; (d) AC curve 

Last Answer : (a) MC curve ; 

In a competitive market ……………….. is the price taker (a) Firm ; (b) Industry ; (c) Consumer ; (d) Trade association

Description : In a competitive market ……………….. is the price taker (a) Firm ; (b) Industry ; (c) Consumer ; (d) Trade association

Last Answer : (a) Firm ; 

In a competitive market ………. is the price maker (a) Firm ; (b) Industry ; (c) Consumer ; (d) Trade association

Description : In a competitive market ………. is the price maker (a) Firm ; (b) Industry ; (c) Consumer ; (d) Trade association

Last Answer : (b) Industry ;

A monopoly firm makes more profit because (a) It has ability to choose among price and output combination ; (b) It can discriminate price; (c) It leave the consumer with no consumer surplus ; (d) it acts as a market leader

Description : A monopoly firm makes more profit because (a) It has ability to choose among price and output combination ; (b) It can discriminate price; (c) It leave the consumer with no consumer surplus ; (d) it acts as a market leader

Last Answer : (a) It has ability to choose among price and output combination ;

In short run a monopolistic competition firm will be in equilibrium where (a) MR = curve intersect SMC curve from above (b) MR curve intersect SMC curve from below (c) MC = AR ; (d) MR curve intersect SMC from below and P is equal to or more than AVC

Description : In short run a monopolistic competition firm will be in equilibrium where (a) MR = curve intersect SMC curve from above (b) MR curve intersect SMC curve from below (c) MC = AR ; (d) MR curve intersect SMC from below and P is equal to or more than AVC

Last Answer : ; (d) MR curve intersect SMC from below and P is equal to or more than AVC

When the Demand curve of a pure monopoly firm is elastic, MR will be (a) Negative ; (b) Positive ; (c) Zero ; (d) Any of these

Description : When the Demand curve of a pure monopoly firm is elastic, MR will be (a) Negative ; (b) Positive ; (c) Zero ; (d) Any of these

Last Answer : (b) Positive ;

A firm that makes profit in excess of normal profit is earning (a) Economic profit ; (b) Costing profit ; (c) Normal profit ; (d) Super normal profit

Description : A firm that makes profit in excess of normal profit is earning (a) Economic profit ; (b) Costing profit ; (c) Normal profit ; (d) Super normal profit

Last Answer : ; (d) Super normal profit

A firm that break even after all the economic costs are paid in earning (a) Economic profit ; (b) Accounting profit ; (c) Normal profit ; (d) Super normal profit

Description : A firm that break even after all the economic costs are paid in earning (a) Economic profit ; (b) Accounting profit ; (c) Normal profit ; (d) Super normal profit

Last Answer :  (c) Normal profit ;

In the long run a firm in perfect competition earns (a) Normal profit only ; (b) Abnormal profit ; (c) Average profit of past five years; (d) 12.33% profit on capital employed

Description : In the long run a firm in perfect competition earns (a) Normal profit only ; (b) Abnormal profit ; (c) Average profit of past five years; (d) 12.33% profit on capital employed

Last Answer : (a) Normal profit only ;

When a firm enters the law of diminishing returns to scale (a) TVC curve begins to fall at an increasing rate (b) TVC curve begins to increase at an increasing rate (c) TVC curve begins to fall at an decreasing rate (d) TVC curve begins to increase at an decreasing rate

Description : When a firm enters the law of diminishing returns to scale (a) TVC curve begins to fall at an increasing rate (b) TVC curve begins to increase at an increasing rate (c) TVC curve begins to fall at an decreasing rate (d) TVC curve begins to increase at an decreasing rate

Last Answer : (a) TVC curve begins to fall at an increasing rate 

If a firm is operating at any point inside the PPF, the firm is (a) Efficient firm ; (b) Inefficient firm ; (c) Poised for abnormal growth ; (d) None

Description : If a firm is operating at any point inside the PPF, the firm is (a) Efficient firm ; (b) Inefficient firm ; (c) Poised for abnormal growth ; (d) None

Last Answer :  (b) Inefficient firm

During the recessionary phase of a business cycle (a) The natural rate of unemployment will increase dramatically (b) Potential national income will exceed actual national income (c) Actual national income will exceed potential national income (d) The real rate of interest will exceed the nominal rate of interest.

Description : During the recessionary phase of a business cycle (a) The natural rate of unemployment will increase dramatically (b) Potential national income will exceed actual national income (c) Actual national income ... national income (d) The real rate of interest will exceed the nominal rate of interest.

Last Answer : (a) The natural rate of unemployment will increase dramatically  

If the actual rate of unemployment exceeds to natural rate of unemployment then (a) Actual output of the economy will fall below its potential ; (b) Production will increase more than potential ; (c) Consumption of goods decreases; (d) Both (a) and (c) above.

Description : If the actual rate of unemployment exceeds to natural rate of unemployment then (a) Actual output of the economy will fall below its potential ; (b) Production will increase more than potential ; (c) Consumption of goods decreases; (d) Both (a) and (c) above.

Last Answer : (d) Both (a) and (c) above.

The quantity of a commodity which an individual is willing to purchase over a specific period of time is a function of (a) Price of the product ; (b) Disposal income ; (c) Taste and price of other commodities; (d) All the three

Description : The quantity of a commodity which an individual is willing to purchase over a specific period of time is a function of (a) Price of the product ; (b) Disposal income ; (c) Taste and price of other commodities; (d) All the three

Last Answer : (d) All the three

Disguised unemployment refers to the situation when (a) Marginal Productivity of the surplus workers is zero (b) Marginal productivity of the surplus workers is less than average productivity (c) Marginal productivity of the surplus workers is falling sharply (d) Marginal productivity of the surplus workers is falling sharply

Description : Disguised unemployment refers to the situation when (a) Marginal Productivity of the surplus workers is zero (b) Marginal productivity of the surplus workers is less than average productivity ( ... surplus workers is falling sharply (d) Marginal productivity of the surplus workers is falling sharply

Last Answer : (a) Marginal Productivity of the surplus workers is zero

Supply of money refers to (a) Total money held by the public ; (b) Total money held by RBI ; (c) Total money with all the commercial banks and RBI ; (d) Total money in Government account

Description : Supply of money refers to (a) Total money held by the public ; (b) Total money held by RBI ; (c) Total money with all the commercial banks and RBI ; (d) Total money in Government account

Last Answer : (a) Total money held by the public ; 

In economic theory the term “means” refers to (a) Resources ; (b) Arithmetic mean ; (c) A characteristic ; (d) None

Description : In economic theory the term “means” refers to (a) Resources ; (b) Arithmetic mean ; (c) A characteristic ; (d) None

Last Answer : (a) Resources ;

General equilibrium analysis refers to (a) Behaviour of individual economic decision making units and individual markets in isolation; (b) Behaviour of all the individual decision making units and market viewed in totality; (c) Both ; (d) (d) none

Description : General equilibrium analysis refers to (a) Behaviour of individual economic decision making units and individual markets in isolation; (b) Behaviour of all the individual decision making units and market viewed in totality; (c) Both ; (d) (d) none

Last Answer : (b) Behaviour of all the individual decision making units and market viewed in totality; 

The …………………………….. measurement method of national income aggregates all the money spent by private citizens, firms and the government within the year. (a) Expenditure ;(b) Income ; (c) Input ; (e) Saving

Description : The …………………………….. measurement method of national income aggregates all the money spent by private citizens, firms and the government within the year. (a) Expenditure ;(b) Income ; (c) Input ; (e) Saving

Last Answer : (a) Expenditure 

Higher PPC curve indicates (a) More production of both the things with increase in technology or factor inputs supply; (b) More production of one at the expense of other; (c) More production of one items at the expense of other with increase in technology or factor input supply ; (d) Less than full employment situation

Description : Higher PPC curve indicates (a) More production of both the things with increase in technology or factor inputs supply; (b) More production of one at the expense of other; (c) More production of ... of other with increase in technology or factor input supply ; (d) Less than full employment situation

Last Answer : (a) More production of both the things with increase in technology or factor inputs supply; 

he non-expenditure costs which arise when the producing firm itself owns and supplies certain factors of production are - (1) Explicit costs (2) Original costs (3) Implicit costs (4) Replacement costs

Description : he non-expenditure costs which arise when the producing firm itself owns and supplies certain factors of production are - (1) Explicit costs (2) Original costs (3) Implicit costs (4) Replacement costs

Last Answer : (3) Implicit costs Explanation: In economics, an implicit is the opportunity cost equal to what a firm must give up in order to use factors which it neither purchases nor hires. It is ... instead of renting, selling or lending it. These are costs a business incurs without actually spending money.