McqMate
These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Bachelor of Business Administration (BBA) .
| 51. |
Generally demand curve have ………… |
| A. | negative slope |
| B. | positive slope |
| C. | horizontal line |
| D. | vertical line |
| Answer» A. negative slope | |
| 52. |
The change in demand due to change in price only, where other factors remaining constant, it is called………. |
| A. | shift in demand |
| B. | extension of demand |
| C. | contraction of demand |
| D. | both extension and contraction |
| Answer» D. both extension and contraction | |
| 53. |
When the quantity demanded of a commodity rises due to a fall in price, it is called |
| A. | extension |
| B. | upward shift |
| C. | downward shift |
| D. | contraction |
| Answer» A. extension | |
| 54. |
When the quantity demanded falls due to a rise in price, it is called |
| A. | extension |
| B. | upward shift |
| C. | downward shift |
| D. | contraction |
| Answer» D. contraction | |
| 55. |
The Giffen goods are ………. Goods |
| A. | inferior goods |
| B. | superior goods |
| C. | related goods |
| D. | same goods |
| Answer» A. inferior goods | |
| 56. |
Higher the price of certain luxurious articles, higher will be the demand, this concept is called |
| A. | giffen effects |
| B. | veblen effects |
| C. | demonstration effects |
| D. | both b & c above |
| Answer» B. veblen effects | |
| 57. |
Demand for milk, sugar, tea for making tea, is an example of |
| A. | composite demand |
| B. | derivative demand |
| C. | joint demand |
| D. | direct demand |
| Answer» C. joint demand | |
| 58. |
Perfect elasticity is known as |
| A. | finite elastic |
| B. | infinite elastic |
| C. | unitary elastic |
| D. | zero elastic |
| Answer» B. infinite elastic | |
| 59. |
In the case of perfect elasticity, the demand curve is |
| A. | vertical |
| B. | horizontal |
| C. | flat |
| D. | steep |
| Answer» B. horizontal | |
| 60. |
In a perfectly competitive market, individual firm |
| A. | cannot influence the price of its product |
| B. | can influence the price of its product |
| C. | can fix the price of its product |
| D. | can influence the market force |
| Answer» A. cannot influence the price of its product | |
| 61. |
Perfect competition is characterized by |
| A. | large number of buyers and sellers |
| B. | homogeneous product |
| C. | free entry and exit of firms |
| D. | all the above |
| Answer» D. all the above | |
| 62. |
The market with a single producer |
| A. | perfect competition |
| B. | monopolistic competition |
| C. | oligopoly |
| D. | monopoly |
| Answer» D. monopoly | |
| 63. |
Selling cost is the feature of the market form |
| A. | monopoly |
| B. | monopolistic competition |
| C. | oligopoly |
| D. | none of these |
| Answer» B. monopolistic competition | |
| 64. |
The product under monopolistic competition are |
| A. | differentiated with close substitute |
| B. | perfect substitute |
| C. | differentiated without close substitute |
| D. | homogeneous |
| Answer» A. differentiated with close substitute | |
| 65. |
In business cycle concept, the period of “long wave” is of; |
| A. | 25 years |
| B. | 50 years |
| C. | 100 years |
| D. | 200 years |
| Answer» B. 50 years | |
| 66. |
In economics …….. means ‘a state of rest ‘or ‘stability’ |
| A. | depression |
| B. | equilibrium |
| C. | maturity |
| D. | growth |
| Answer» B. equilibrium | |
| 67. |
Selling at a lower price in export market and at a higher price at home market is called |
| A. | export subsidy |
| B. | dumping |
| C. | price cut |
| D. | all the above |
| Answer» B. dumping | |
| 68. |
A fall in the price of a commodity leads to |
| A. | a shift in demand |
| B. | a fall in demand |
| C. | a rise in the consumer’s real income |
| D. | a fall in the consumer’s real income |
| Answer» C. a rise in the consumer’s real income | |
| 69. |
An exceptional demand curve is one that slopes |
| A. | upward to the left |
| B. | downward to the right |
| C. | horizontally |
| D. | upward to the right |
| Answer» D. upward to the right | |
| 70. |
Which one is not an exception to the Law of Demand? |
| A. | normal good |
| B. | articles of distinction |
| C. | ignorance |
| D. | inferior good |
| Answer» A. normal good | |
| 71. |
Demand for a commodity is elastic when it has: |
| A. | only one use |
| B. | uses which cannot be postponed |
| C. | many uses |
| D. | uses very essential for the consumer |
| Answer» C. many uses | |
| 72. |
When the demand curve is a rectangular hyperbola, it represents: |
| A. | perfectly elastic demand |
| B. | unitary elastic demand |
| C. | perfectly inelastic demand |
| D. | relatively elastic demand |
| Answer» B. unitary elastic demand | |
| 73. |
The horizontal demand curve for a commodity shows that its demand is: |
| A. | perfectly elastic |
| B. | highly elastic |
| C. | perfectly inelastic |
| D. | moderately elastic |
| Answer» A. perfectly elastic | |
| 74. |
When an individual’s income falls (while everything else remains the same), his demand for an inferior good: |
| A. | increases |
| B. | decrease |
| C. | remains unchanged |
| D. | we cannot say without additional information |
| Answer» B. decrease | |
| 75. |
A fall in the price of a commodity whose demand curve is a rectangular hyperbola causes total expenditure on the commodity to: |
| A. | increases |
| B. | decrease |
| C. | remains unchanged |
| D. | any of the above |
| Answer» C. remains unchanged | |
| 76. |
The utility may be defined as: |
| A. | the desire for a commodity |
| B. | the usefulness of a commodity |
| C. | the necessity of a commodity |
| D. | the power of a commodity to satisfy wants |
| Answer» D. the power of a commodity to satisfy wants | |
| 77. |
The utility of a commodity is: |
| A. | its expected social value |
| B. | the extent of its practical use |
| C. | its relative scarcity |
| D. | the degree of its fashion |
| Answer» C. its relative scarcity | |
| 78. |
Marginal utility curve of a given consumer is also his: |
| A. | indifference curve |
| B. | total utility curve |
| C. | demand curve |
| D. | supply curve |
| Answer» C. demand curve | |
| 79. |
The relationship between demand for a commodity and price, ceteris paribus, is: |
| A. | negative |
| B. | positive |
| C. | non-negative |
| D. | non-positive |
| Answer» A. negative | |
| 80. |
A demand curve which takes the form of horizontal line parallel to quantity axis illustrates elasticity which is: |
| A. | zero |
| B. | infinite |
| C. | greater than one |
| D. | less than one |
| Answer» D. less than one | |
| 81. |
Consider a demand curve which takes the form of a straight line cutting both axes. Elasticity at the mid-point of the line would be: |
| A. | zero |
| B. | one infinite |
| C. | infinite |
| D. | cannot be calculated |
| Answer» B. one infinite | |
| 82. |
The elasticity of demand for a product will be higher: |
| A. | the more available are substitutes for that product |
| B. | the more its buyers demand loyalty |
| C. | the more the product is considered a necessity by its buyers |
| D. | all of the above |
| Answer» A. the more available are substitutes for that product | |
| 83. |
In case of Giffen goods, demand curve will slope: |
| A. | vertical |
| B. | horizontal |
| C. | upward |
| D. | downward |
| Answer» C. upward | |
| 84. |
Cross elasticity of demand between tea and sugar is: |
| A. | positive |
| B. | zero |
| C. | infinity |
| D. | negative |
| Answer» D. negative | |
| 85. |
If the percentage increase in quantity of a commodity demanded is its price, the coefficient of price elasticity of demand is: |
| A. | greater than 1 |
| B. | equal to 1 |
| C. | less than 1 |
| D. | zero |
| Answer» C. less than 1 | |
| 86. |
If the quantity of a commodity demanded remains unchanged as its price changes, the coefficient of price elasticity of demand is |
| A. | greater than 1 |
| B. | equal to 1 |
| C. | less than 1 |
| D. | zero |
| Answer» D. zero | |
| 87. |
Unitary elasticity of demand is: |
| A. | zero |
| B. | equal to one |
| C. | greater than 1 |
| D. | less than 1 |
| Answer» B. equal to one | |
| 88. |
The real business cycle theory is most closely related to |
| A. | keynesian theory |
| B. | monetarist theory |
| C. | the classical theory |
| D. | the new keynesian theory |
| Answer» C. the classical theory | |
| 89. |
In the real business cycle model, business cycles are |
| A. | efficient and do not represent lost output |
| B. | driven by technology shocks |
| C. | occur when markets clear |
| D. | all of the above |
| Answer» D. all of the above | |
| 90. |
Real business cycle proponents argue that |
| A. | recessions are caused by movements of output away from the natural rate of output |
| B. | prices and wages are sticky |
| C. | macroeconomics should be based on the same assumptions as microeconomics |
| D. | monetary policy is important in determining recessions |
| Answer» C. macroeconomics should be based on the same assumptions as microeconomics | |
| 91. |
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. |
| Answer» C. "payments" for self-employed resources. | |
| 92. |
The law of diminishing returns only applies in cases where: |
| A. | there is increasing scarcity of factors of production. |
| B. | the price of extra units of a factor is increasing. |
| C. | there is at least one fixed factor of production. |
| D. | capital is a variable input. |
| Answer» C. there is at least one fixed factor of production. | |
| 93. |
When the total product curve is falling, the: |
| A. | marginal product of labour is zero. |
| B. | marginal product of labour is negative. |
| C. | average product of labour is increasing. |
| D. | average product of labour must be negative. |
| Answer» B. marginal product of labour is negative. | |
| 94. |
When marginal product reaches its maximum, what can be said of total product? |
| A. | total product must be at its maximum |
| B. | total product starts to decline even if marginal product is positive |
| C. | total product is increasing if marginal product is still positive |
| D. | total product levels off |
| Answer» C. total product is increasing if marginal product is still positive | |
| 95. |
Variable costs are: |
| A. | sunk costs. |
| B. | multiplied by fixed costs. |
| C. | costs that change with the level of production. |
| D. | defined as the change in total cost resulting from the production of an additional |
| Answer» C. costs that change with the level of production. | |
| 96. |
The reason the marginal cost curve eventually increases as output increases for the typical firm is because: |
| A. | of diseconomies of scale. |
| B. | of minimum efficient scale. |
| C. | of the law of diminishing returns. |
| D. | normal profit exceeds economic profit. |
| Answer» C. of the law of diminishing returns. | |
| 97. |
If the short-run average variable costs of production for a firm are rising, then this indicates that: |
| A. | average total costs are at a maximum. |
| B. | average fixed costs are constant. |
| C. | marginal costs are above average variable costs. |
| D. | average variable costs are below average fixed costs. |
| Answer» C. marginal costs are above average variable costs. | |
| 98. |
If a more efficient technology was discovered by a firm, there would be: |
| A. | an upward shift in the avc curve. |
| B. | an upward shift in the afc curve. |
| C. | a downward shift in the afc curve. |
| D. | a downward shift in the mc curve. |
| Answer» D. a downward shift in the mc curve. | |
| 99. |
The firm's short-run marginal-cost curve is increasing when: |
| A. | marginal product is increasing. |
| B. | marginal product is decreasing. |
| C. | total fixed cost is increasing. |
| D. | average fixed cost is decreasing. |
| Answer» B. marginal product is decreasing. | |
| 100. |
A firm encountering economies of scale over some range of output will have a: |
| A. | rising long-run average cost curve. |
| B. | falling long-run average cost curve. |
| C. | constant long-run average cost curve. |
| D. | rising, then falling, then rising long-run average cost curve. |
| Answer» B. falling long-run average cost curve. | |
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