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

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 
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1 Answer

Answer :

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

Description : 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

Last Answer : (a) Actual expenses of the firm to purchase or hire input it needed 

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 ;

Which of the following is an example of an intermediate goods. (a) A Tata Indica sold by a dealer of second hand car ; (b) Steel and cement used to construct a flyover ; (c) Farming crop purchased by FCI (d) All the three

Description : Which of the following is an example of an intermediate goods. (a) A Tata Indica sold by a dealer of second hand car ; (b) Steel and cement used to construct a flyover ; (c) Farming crop purchased by FCI (d) All the three

Last Answer : (b) Steel and cement used to construct a flyover ;

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 ; 

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; 

GDP is defined as (a) The market value of all goods and services produced in the domestic economy during the year ; (b) Current value of all the capital goods produced in the country. ; (c) Sum of goods and services exported during the year. ; (d) All the capital goods and consumable goods produced and sold during the year

Description : GDP is defined as (a) The market value of all goods and services produced in the domestic economy during the year ; (b) Current value of all the capital goods produced in the country. ; (c) ... during the year. ; (d) All the capital goods and consumable goods produced and sold during the year

Last Answer : (a) The market value of all goods and services produced in the domestic economy during the year ; 

NDP does not include (a) Payments made for income taxes ; (b) Depreciation allowances ; (c) Undistributed profits; (d) The value added from intermediate goods.

Description : NDP does not include (a) Payments made for income taxes ; (b) Depreciation allowances ; (c) Undistributed profits; (d) The value added from intermediate goods.

Last Answer : (b) Depreciation allowances ;

„Transfer Payments‟ are (a) Payments made to a factor of production ; (b) Payments transferred from one sector to another; (c) Payments made for no return service ; (d) Payments made by government of one country to another

Description : „Transfer Payments‟ are (a) Payments made to a factor of production ; (b) Payments transferred from one sector to another; (c) Payments made for no return service ; (d) Payments made by government of one country to another

Last Answer : (c) Payments made for no return service ;  

A Monopoly‟s demand curve is (a) Same as its average revenue curve ; (b) Same as its supply curve; (c) Same as its cost curve ; (d) Same as that of the factor inputs

Description : A Monopoly‟s demand curve is (a) Same as its average revenue curve ; (b) Same as its supply curve; (c) Same as its cost curve ; (d) Same as that of the factor inputs

Last Answer : (a) Same as its average revenue curve ;

Total variable cost curve is explained by (a) Law of the diminishing marginal returns ; (b) The price of the variable inputs; (c) Production function ; (d) All the three

Description : Total variable cost curve is explained by (a) Law of the diminishing marginal returns ; (b) The price of the variable inputs; (c) Production function ; (d) All the three 

Last Answer : ; (d) All the three

Which of these is not a factor of cost function of a product (a) Market price of the product ; (b) Size of the plant ; (c) Output level ; (d) Prices of inputs

Description : Which of these is not a factor of cost function of a product (a) Market price of the product ; (b) Size of the plant ; (c) Output level ; (d) Prices of inputs

Last Answer : (a) Market price of the product ;

Value added is: a) the cost saving through production and marketing efforts within the firm. b) the value that a firm adds through the development of dynamic capabilities. c) the value that a firm adds to bought-in materials and services through outsourcing. d) the difference between the cost of inputs and the market value of outputs

Description : Value added is: a) the cost saving through production and marketing efforts within the firm. b) the value that a firm adds through the development of dynamic capabilities. c) the value that a ... through outsourcing. d) the difference between the cost of inputs and the market value of outputs

Last Answer : the difference between the cost of inputs and the market value of outputs

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 ;

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 ;

Any point beyond PPF curve can be attained by (a) Increasing supply of factor inputs ; (b) Technological innovation ; (c) Both ; (d) None

Description : Any point beyond PPF curve can be attained by (a) Increasing supply of factor inputs ; (b) Technological innovation ; (c) Both ; (d) None

Last Answer : ; (c) Both ;

The central problem of how to produce is resolved by (a) Demand and supply of factor inputs ; (b) Demand and supply of goods; (c) Relative prices and availability of factors of production ; (d) Government intervention

Description : The central problem of how to produce is resolved by (a) Demand and supply of factor inputs ; (b) Demand and supply of goods; (c) Relative prices and availability of factors of production ; (d) Government intervention

Last Answer : (c) Relative prices and availability of factors of production

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; 

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 ;

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;

Which of these is / are a transfer payments(s)? (a) Pension ; (b) Scholarship ; (d) Unemployment allowance ; (d) All the three

Description : Which of these is / are a transfer payments(s)? (a) Pension ; (b) Scholarship ; (d) Unemployment allowance ; (d) All the three

Last Answer :  (d) All the three

Which of the following transactions is included in the current account balance of the Balance of payments statement? (a) Foreign direct investments. ; (b) Portfolio investments.; (c) External commercial borrowings. ; (d) Dividends earned on portfolio investments

Description : Which of the following transactions is included in the current account balance of the Balance of payments statement? (a) Foreign direct investments. ; (b) Portfolio investments.; (c) External commercial borrowings. ; (d) Dividends earned on portfolio investments

Last Answer : (d) Dividends earned on portfolio investments

If the balance on current and capital accounts of Balance of Payments (BoP) taken together is negative, then (a) It is a case of BoP surplus ; (b) It is a case of BoP surplus where the official reserve account is in surplus; (c) It is a case of BoP deficit ; (d) It is case of BoP disequilibrium

Description : If the balance on current and capital accounts of Balance of Payments (BoP) taken together is negative, then (a) It is a case of BoP surplus ; (b) It is a case of BoP surplus where the official reserve account is in surplus; (c) It is a case of BoP deficit ; (d) It is case of BoP disequilibrium

Last Answer : (c) It is a case of BoP deficit ;

All entries in the balance of payments should collectively sum to (a) GDP of that country ; (b) GNP of that country ; (c) Zero ; (d) Exports of that country.

Description : All entries in the balance of payments should collectively sum to (a) GDP of that country ; (b) GNP of that country ; (c) Zero ; (d) Exports of that country. 

Last Answer :  (c) Zero

The difference between personal disposable income and personal income is (a) Indirect taxes ; (b) Subsidies ; (c) Transfer payments ; (d) Personal taxes.

Description : The difference between personal disposable income and personal income is (a) Indirect taxes ; (b) Subsidies ; (c) Transfer payments ; (d) Personal taxes.

Last Answer : ; (d) Personal taxes.

Personal income includes all of the following except (a) Transfer payments ; (b) Undistributed corporate profits; (c) Personal income taxes ; (d) Dividend payments

Description : Personal income includes all of the following except (a) Transfer payments ; (b) Undistributed corporate profits; (c) Personal income taxes ; (d) Dividend payments

Last Answer : (b) Undistributed corporate profits;

Personal income equals personal disposable income (Yd) plus (a) Personal savings ; (b) Transfers from government ; (c) Personal income taxes ; (d) Dividend payments

Description : Personal income equals personal disposable income (Yd) plus (a) Personal savings ; (b) Transfers from government ; (c) Personal income taxes ; (d) Dividend payments 

Last Answer : (c) Personal income taxes ;

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 ;

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 ;

At a given time and in a given marketplace, the entire market demand curve indicates the (a) quantity of a good consumers would be willing and able to purchase at a given price. (b) quantity of a good consumers would be able to purchase at a series of prices. (c) quantity of a good consumers want to purchase at a given price (d) quantity of a good consumers have purchased at a series of prices over the year.

Description : At a given time and in a given marketplace, the entire market demand curve indicates the (a) quantity of a good consumers would be willing and able to purchase at a given price. (b) quantity of a ... a given price (d) quantity of a good consumers have purchased at a series of prices over the year.

Last Answer : (b) quantity of a good consumers would be able to purchase at a series of prices. 

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; 

Diminishing returns occurs when a firm (a) uses too much of all inputs (b) uses more and more of one input while holding another inputs constant © does not utilize its inputs efficiently (d) cut down on the quantity of all inputs it uses

Description : Diminishing returns occurs when a firm (a) uses too much of all inputs (b) uses more and more of one input while holding another inputs constant © does not utilize its inputs efficiently (d) cut down on the quantity of all inputs it uses

Last Answer : b) uses more and more of one input while holding another inputs constant

Which of these is a secondary sector (a) Manufacturing sector ; (b) Transport ; (c) Forestry ; (d) Animal husbandry

Description : Which of these is a secondary sector (a) Manufacturing sector ; (b) Transport ; (c) Forestry ; (d) Animal husbandry

Last Answer : (a) Manufacturing sector ;

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% ;

Implicit costs are (a) equal to total fixed costs (b) comprised entirely of variable costs (c) payments for self-employed resources(d) always greater in the short run than in the long run

Description : Implicit costs are (a) equal to total fixed costs (b) comprised entirely of variable costs (c) payments for self-employed resources (d) always greater in the short run than in the long run

Last Answer : (c) payments for self-employed resources

In NetBill’s protocol for small payments for internet services (i) Key to decrypt information is sent to customer by NetBill only when there is enough amount in debit account (ii) The vendor supplies the key to NetBill server when he receives payment (iii) Checksum of encrypted information received by customer is attached to his payment order (iv) Vendor does not encrypt information purchased by customer a. i, ii b. i, ii, iii c. i, ii, iii, iv d. i, ii, iv

Description : In NetBill's protocol for small payments for internet services (i) Key to decrypt information is sent to customer by NetBill only when there is enough amount in debit account (ii) The vendor supplies the key to NetBill server when he ... i, ii b. i, ii, iii c. i, ii, iii, iv d. i, ii, iv

Last Answer : b. i, ii, iii 

Which of these is not a part of GDP for the year 2006? (a) Earning of an International fashion show organized in Delhi (b) Sale of ticket for Republic day parade. ; (c) Fee of a practicing Chartered Accountant (d) A house built in 2000 and first sold in 2006

Description : Which of these is not a part of GDP for the year 2006? (a) Earning of an International fashion show organized in Delhi (b) Sale of ticket for Republic day parade. ; (c) Fee of a practicing Chartered Accountant (d) A house built in 2000 and first sold in 2006

Last Answer : (d) A house built in 2000 and first sold in 2006

Which of the following function does money serve when used to purchase or sell different goods and services? (a) Store of value ; (b) Medium of exchange ; (c) Standard of value ; (d) Display of power

Description : Which of the following function does money serve when used to purchase or sell different goods and services? (a) Store of value ; (b) Medium of exchange ; (c) Standard of value ; (d) Display of power

Last Answer : (b) Medium of exchange ;

Which of the following function does money serve when used to measure the prices of different goods and services? (a) Store of value ; (b) Medium of exchange ; (c) Standard of value ; (d) Display of power

Description : Which of the following function does money serve when used to measure the prices of different goods and services? (a) Store of value ; (b) Medium of exchange ; (c) Standard of value ; (d) Display of power

Last Answer : (c) Standard of value ;

GDP can be defined as sum of the market value of the……….. (a) Final manufactured goods and services ; (b) Intermediate goods (c) Goods and services exported ; (d) Sub-standard goods and discarded services

Description : GDP can be defined as sum of the market value of the……….. (a) Final manufactured goods and services ; (b) Intermediate goods (c) Goods and services exported ; (d) Sub-standard goods and discarded services 

Last Answer : (a) Final manufactured goods and services ;

National income is the ……………. Of all the goods and services produced by a country during a period of year (a) Physical quantity ; (b) Money value ; (c) `Value ; (d) All the three

Description : National income is the ……………. Of all the goods and services produced by a country during a period of year (a) Physical quantity ; (b) Money value ; (c) `Value ; (d) All the three 

Last Answer : (b) Money value ; 

Nominal GDP is (a) The total value of goods and services net of exports (b) The total value of goods and services produced during periods of low unemployment (c) The total value of goods and services measured at current prices (d) The total value of goods and services produced at full employment.

Description : Nominal GDP is (a) The total value of goods and services net of exports (b) The total value of goods and services produced during periods of low unemployment (c) The total value of goods and services measured at current prices (d) The total value of goods and services produced at full employment.

Last Answer : (c) The total value of goods and services measured at current prices

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;