Question # 1

In monopoly, when total revenue of a firm is maximum, then its marginal revenue is

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Maximum

Minimum

Zero

Negative

When total production is maximum, marginal product is:

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Positive

Negative

Zero

Infinite

The difference between total revenue (TR) and total cost (TC) is called

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Loss

Profit

Profit or loss

Utility

Firms equilibrium is at that point where

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MC=AR

MC=MR

MC=AVC

MC=AC

To increase profit a firm minimizes

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Revenues

Costs

Demand

Supply

When average product increases, marginal product is:

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Also increases

Decreases

Zero

Negative

If the demand for commodity being produced increases, then a firm in the short run ------- its variable factors

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Increases

Decreases

Keeps the same

None of three

Law of increasing return is more applicable in:

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Trade sector

Industrial sector

Agricultural sector

Power sector

When a firm earns abnormal profit in the short run, then its

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MC=MR=AR=AC all are equal

MC=MR=AR while AC is less

MC=MR=AR while AC is more

MC=MR=AR while AV is sometimes equal to them and sometimes less than tham

If the most part of total supply of commodity is produced by one firm, it is called

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Oligopoly

Monopoly

Perfect competition

Monopolistic competition

If the equation is this, MC=MR=AR(P)<AC then the firm

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Earns normal profit

Earns abnormal profit

Bears loss

Bears abnormal loss

When total production increases, marginal product is:

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Positive

Negative

Zero

Infinite

When average product is maximum, marginal product is:

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Positive

Equal to AP

Zero

Negative

Usually elasticity of demand in equilibrium situation under monopoly is

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Equal than unity

Less than unity

more than unity

Zero

When total production decreases, marginal product is:

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Positive

Negative

Zero

Infinite

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Principles of Economics Icom Part 1 English Medium Chapter 7 Online Test MCQs With Answers

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