| 1 |
The law of increasing returns is also known as: |
- A. Law of increasing cost
- B. Law of diminishing cost
- C. Law of constant cost
- D. None of the three
|
| 2 |
When business expands beyond its optimum level what type of economics will it be getting. |
- A. Diseconomies
- B. Internal economies
- C. External economies
- D. Maanagerial economics
|
| 3 |
In production of goods, negative returns in the short run imply that |
- A. average product is negative
- B. total product is negative
- C. marginal product is negative
- D. marginal cost is falling
|
| 4 |
Which one is the third stage of production under law of variable proportions |
- A. Decreasing average returns
- B. Increasing average return
- C. Negative marginal return
- D. Increasing marginal return
|
| 5 |
Marginal product curve intersects average product curve when AP curve is |
- A. minimum
- B. maximum
- C. rising
- D. falling
|
| 6 |
Which of the following saying describes diminishing marginal returns in the short run? |
- A. When the cat is away, the mouse will play
- B. Too many cooks spoil the broth
- C. A rolling stone gathers no moss
- D. A stitch in time saves nine
|
| 7 |
Which of the following is example of external economies of scale? |
- A. Discount on purchases of raw materials
- B. Technical progress leads to development of machines at low price
- C. Hiring of specialized staff due to increase in scale of production
- D. A firm starts producing by products
|
| 8 |
When total product (TP) reaches its maximum, Marginal product (MP) is_ |
- A. Zero
- B. Positive
- C. Negative
- D. Rising
|
| 9 |
When average product falls marginal product |
- A. Rises
- B. Also falls
- C. Remain equal to average product
- D. Does not change
|
| 10 |
An important factor which promotes large scale production is: |
- A. Extant of market
- B. Revolutionary changes in social life
- C. Culture and civilization
- D. All the three
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