Question # 1

Normal profit is

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part of total cost

part of economic profit

part of fixed cost

total revenue minus total cost

profit is a maximum when

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TC and TR curves are parallel

MC and MR curves are parallel

AC and AR curves are parallel

TFC and TVC are parallel

In the long-run a competitive firms attains only:

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Normal profit

Super Normal profit

Sub-Normal profit

Marginal cost

Compare with monopoly price, the competitive price ids always:

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Less than monopoly price

More than monopoly pruce

Equal to monopoly price

Non of the three

Choose the correct establish condition for equilibrium

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MR = MC

MC intersects MR curve from below

MC + MR

Both a and b

Normal profit is attained where:

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TR = TC

TR >TC

AR > MR

AR < MR

When TR of a competitive firm is equal to its TC, the firm attains.

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Normal profit

Super normal profit

Sub-normal profit

Shutdown point

TR increase at a constant rate under:

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monopoly

Monopolistic

Perfect competition

Oligopoly

A firm attains equilibrium under monopoly if:

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MC curve intersect MR curve from below. MC = AC = MR

MC curve intersects MR from above

Any one of the above situations

AR = MR

Normally MR curve intersects MC curve at points

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1

2

3

4

At the point of equilibrium of firm under perfect competition

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MC curve must be rising

MC curve must be falling

MR curve must be rising

MR curve must be falling

A firm attains equilibrium under monopoly where:

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AR = MR

AC = MC

MR = MC

AR = AC

Profit is maximum when

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distance between TR and TC is maximum

distance between AR and AC is maximum

distance between MR and MC is maximum

distance between MR and AR is maximum

An economic unit, which is independent to take decisions regarding the production and sale of goods are called

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Firm

Organization

Both a and b

None of these

In the long-run a firm attains under monopoly;

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Normal profit

Super normal profit

Sub-normal profit

Any on of the above

A firm attains sub-normal profit when:

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AR = AC

AR < AC

AR > AC

TR < TC

A firm decides to shut down production temporarily when

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MC start rising

AC stat rising

price = AC

price falls below AVC

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Economics Ics Part 1 English Medium Chapter 14 Online Test MCQs With Answers

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