Economics MCQ Questions and Solutions with Explanations | Commerce

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71.
In perfect competition,

A. short run abnormal profits are competed away by firms leaving the industry

B. short run abnormal profits are competed away by firms entering the industry

C. short run abnormal profits are competed away by the government

D. short run abnormal profits are competed away by greater advertising

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72.
Which of the following is not a U shaped curve

A. Average fixed cost curve

B. Average variable cost curve

C. Average total cost curve

D. Marginal cost curve

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73.
Investment multiplier can be derived from (symbols have simple meaning)

A. $$\frac{1}{{1 - \frac{{\Delta C}}{{\Delta S}}}}$$

B. $$\frac{1}{{1 - \frac{{\Delta C}}{{\Delta Y}}}}$$

C. $$\frac{1}{{1 + \frac{{\Delta C}}{{\Delta S}}}}$$

D. $$\frac{1}{{1 + \frac{{\Delta C}}{{\Delta Y}}}}$$

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74.
The supply function will move downwards to the right, if the MC of all the firms in a perfectly competitive industry were to

A. decrease

B. remain unchanged

C. increase

D. None of these

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75.
If Q₁ = 20,000, Q₂ = 25,000, P₁ = Rs. 10, P₂ = Rs. 8 the price elasticity of demand will be proportionately to?

A. 1.20

B. 1.00

C. 1.25

D. 1.50

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76.
The conditions of long period equilibrium for a firm operating under perfect competition are
1. MC = MR
2. AC = AR
3. AR = MR
4. AC = MC
Select the correct answer

A. Only 1

B. Both 1 and 3

C. 2, 3 and 4

D. All of the above

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77.
Which among the following has the least price elasticity of demand?

A. Car

B. Tea

C. Salt

D. House

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78.
Imagine a country which has certain available resources and techniques. Assume that the country is producing two commodities A and B. Now if you draw a Production Possibility curve it will slope downwards. It will be

A. A convex curve

B. A concave curve

C. A straight line curve

D. A rectangular hyperbola

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79.
Generally, the profits are maximised in the short-run at the point at which

A. MC = MR

B. MR = 0

C. MR is negative

D. MC = 0

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80.
Consider the demand curve depicted in the following diagram-

The elasticities of demand at prices P₁ and P₂ are different because, at these prices

A. slopes are different

B. prices are different

C. quantities are different

D. price-quantity ratios are different

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Economics MCQ Questions and Solutions with Explanations | Commerce

71. In perfect competition,

Answer & Solution

72. Which of the following is not a U shaped curve

Answer & Solution

73. Investment multiplier can be derived from (symbols have simple meaning)

Answer & Solution

74. The supply function will move downwards to the right, if the MC of all the firms in a perfectly competitive industry were to

Answer & Solution

75. If Q1 = 20,000, Q2 = 25,000, P1 = Rs. 10, P2 = Rs. 8 the price elasticity of demand will be proportionately to?

Answer & Solution

76. The conditions of long period equilibrium for a firm operating under perfect competition are 1. MC = MR 2. AC = AR 3. AR = MR 4. AC = MC Select the correct answer

Answer & Solution

77. Which among the following has the least price elasticity of demand?

Answer & Solution

78. Imagine a country which has certain available resources and techniques. Assume that the country is producing two commodities A and B. Now if you draw a Production Possibility curve it will slope downwards. It will be

Answer & Solution

79. Generally, the profits are maximised in the short-run at the point at which

Answer & Solution

80. Consider the demand curve depicted in the following diagram- The elasticities of demand at prices P1 and P2 are different because, at these prices

Answer & Solution

Read More Section(Economics)

71.
In perfect competition,

72.
Which of the following is not a U shaped curve

73.
Investment multiplier can be derived from (symbols have simple meaning)

74.
The supply function will move downwards to the right, if the MC of all the firms in a perfectly competitive industry were to

75.
If Q₁ = 20,000, Q₂ = 25,000, P₁ = Rs. 10, P₂ = Rs. 8 the price elasticity of demand will be proportionately to?

76.
The conditions of long period equilibrium for a firm operating under perfect competition are
1. MC = MR
2. AC = AR
3. AR = MR
4. AC = MC
Select the correct answer

77.
Which among the following has the least price elasticity of demand?

78.
Imagine a country which has certain available resources and techniques. Assume that the country is producing two commodities A and B. Now if you draw a Production Possibility curve it will slope downwards. It will be

79.
Generally, the profits are maximised in the short-run at the point at which

80.
Consider the demand curve depicted in the following diagram-

The elasticities of demand at prices P₁ and P₂ are different because, at these prices