51
A firm under monopolistic competition advertises
A)
to lower the cost of production
B)
to increase sales and profits
C)
to compete successful with the rival firms
D)
because it cannot raise the price
Answer & Solution
Answer: Option
B
52
A consumer's spending is restricted because of
A)
Utility maximization
B)
Budget constraints
C)
Demand curve
D)
Marginal utility
Answer & Solution
Answer: Option
B
53
When a consumer increased units of X commodity by giving up some units of Y commodity and even to attain the same level of satisfaction, the marginal rate of substitution will be calculated by
A)
$$\frac{{{\text{Change}}\,{\text{in X commodity}}}}{{{\text{Marginal utility}}\,{\text{of Y commodity}}}}$$
B)
$$\frac{{{\text{Change}}\,{\text{in Y commodity}}}}{{{\text{Marginal utility}}\,{\text{of X commodity}}}}$$
C)
$$\frac{{{\text{Change}}\,{\text{in X commodity}}}}{{{\text{Change}}\,{\text{in Y commodity}}}}$$
D)
$$\frac{{{\text{Change}}\,{\text{in Y commodity}}}}{{{\text{Change}}\,{\text{in X commodity}}}}$$
Answer & Solution
Answer: Option
D
54
Price determination of ten favours public interest because it
A)
allows some products to be produced that would otherwise not be produced in the economy due to the fear of making losses
B)
opens consumption possibilities to consumers that would otherwise not be inaccessible (or unaffordable), if a single price prevailed in the market
C)
allows firms to make supernormal profits, which in turn allows them to sustain price wars when breaking into new markets
D)
All of the above
Answer & Solution
Answer: Option
D
55
The Human Development Index (HDI) is introduced by:
A)
UNDP
B)
UNICEF
C)
IMF
D)
World Bank
Answer & Solution
Answer: Option
A
56
Match the following.
List-I List-II
a. Problem of resource allocation
1. How to produce
b. Problem of choice of techniques
2. For whom to produce
c. Problem of distribution of income
3. Scarcity
d. Problem of choice
4. What to produce
A)
a-4, b-2, c-1, d-3
B)
a-3, b-1, c-2, d-4
C)
a-4, b-1, c-2, d-3
D)
a-2, b-3, c-1, d-4
Answer & Solution
Answer: Option
C
57
A point where the budget line is just touching an indifference curve at one point is
A)
The best affordable point
B)
The least affordable point
C)
On the lowest attainable indifference curve
D)
Both B and C are correct
Answer & Solution
Answer: Option
A
58
The important organisation of development of small scale industries is
A)
IDBI
B)
EXIM BANK
C)
SIDBI
D)
None of the above
Answer & Solution
Answer: Option
C
59
Entrepreneurship development program provides
A)
Unemployment
B)
Employment
C)
Dishonesty
D)
Corruption
Answer & Solution
Answer: Option
B
60
Under perfect competition, the long run equilibrium of the firm is established at
A)
minimum point of LAC
B)
highest point of LAC
C)
minimum point of SAC
D)
highest point of SAC
Answer & Solution
Answer: Option
A
