Question # 1

during short period, diminishing returns may follow because

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quantity of labour is fixed

quality of labour is fixed

quantity of capital is fixed

quantity of any one factor is fixed

The production function relates to

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cost of output

cost of input

output to input

demand to output

When total product falls, marginal product is.

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Zero

Positive

Negative

Falling

Economies and diseconomies of scale determine the shape of

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long run AC curve

short run AC

average fixed cost

none of the above

The slopes of average and marginal products curves are always zero under:

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Law of increasing returns

Law of diminishing returns

Law of constant returns

Law of variable propoitions

Law of decreasing returns generates

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law of economic growth

law of increasing costs

law of variable costs

law of decreasing costs

The maximum point of TP curve is at quantity of labour where

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Average physical product of labour is equal to 1

MPP of labour is at its maximum

curves of APP and MPP of labour intersect

MPP of labour is zero

Commercial economics are a pat of:

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Internal economics

External economics

Economies of scale

None of the three

In production of goods, negative returns in the short run imply that

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average product is negative

total product is negative

marginal product is negative

marginal cost is falling

Which of the following saying describes diminishing marginal returns in the short run?

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When the cat is away, the mouse will play

Too many cooks spoil the broth

A rolling stone gathers no moss

A stitch in time saves nine

An important factor which promotes large scale production is:

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Extant of market

Revolutionary changes in social life

Culture and civilization

All the three

Which one is the small scale production.

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Bata shoe factory

A barber shop

kohinoor Textile Industries

Sufi soap

Which of the following is example of external economies of scale?

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Discount on purchases of raw materials

Technical progress leads to development of machines at low price

Hiring of specialized staff due to increase in scale of production

A firm starts producing by products

Internal economies of scale include

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risk-bearing economics

trade mark

managerial economies

a and c of above

Law of diminishing returns applies more in:

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Industry

Agriculture

Mining

Construction

If in a production process, all inputs are increased by 10% and output increase by less than 10%, then it is called

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economies of scale

diseconomies of scale

diminishing marginal returns

negative economies

When total product rises marginal product.

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Remains the same

Falls

Also rises

None of the three

Marginal product curve intersects average product curve when AP curve is

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minimum

maximum

rising

falling

When a firm using a fixed amount of land and capital takes on more workers, it finds that marginal product(MP) of labour falls but the average product(AP) of labour rises. This can be explained by the factors that

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MP of labour is grater than AP of labour

additional workers are more efficient

MP and AP are equal

AP is maximum

When average product (AP) and marginal product (MP) are rising.

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AP > MP

AP = MP

AP < MP

AP = MP = 0

When business expands beyond its optimum level what type of economics will it be getting.

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Diseconomies

Internal economies

External economies

Maanagerial economics

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