Question # 1

A profit maximizing monopolist in two separate markets will

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Charge different price according to elasticity

Charged same price

Charged very high price

Charged very low price

When the marginal physical product of labor is 800 - 2N , the price of goods is Rs. 2, and the cost of labor is Rs. 4 per unit, the quantity of labor employed is.

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20 Units

800 Units

399 Units

80 units

Which of the following is correct with respect to the Paasche index.

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The consumer Price index is an example of the Paasche index.

The Paasche index is biased upward

The Passche index always exceeds 1

The Paasche index uses given period quantities

A consumer is said to be in equilibrium when the marginla utility and price of a commodity

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More

Less

Irrelevant

Equal

A production function for a firm which produces a product with two or more inputs.

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Represents a physical relationship between outputs for a specified set of inputs

Indicates the least cost combinations of inputs for a given output

Relates revenues and costs

Indicates the dollar cost for each level of ouput.

In the short run the competitive firm will produce if.

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Price is equal to marginal cost

Price is equal to marginal revenue

Price is equal to total cost

Price is equal to are greater than average variable cost.

The demand curve of unitary elastic commodity is.

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Rectangular hyperbola

Parabola

Straight line

None of these

If the estimated values of Y and Py in 1987 are Rs. 20,000 and Rs. 6 respectively, what is the maximum price of X.

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Rs.420

Rs.240

Rs.300

Rs.360

Suppose taht an exise tax is imposed on the monopolist's product if the monopolist's marginal cost is horizontally the relevant range, which of the following statements must be true.

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The price will increase by an amount less than the tax

The price will increase by an amount equal to the tax

The price will increase by a amount greater than tax

The price may either increase or decrease

Price discrimination occurs when

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A commodity has different elasticity in different markets

Same elasticity in different markets

Unitary elasticity different markets

Noe of these

The exit of firms out of a competitive market causes the supply curve to.

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Shift leftward

shift rights ward

None of the above for the exit of firms supply curve

shift either left or right depending on the number of firms leaving the market

If a good has a lot of substitutes, then its demand is.

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Elastic

Inelastic

Unit elastic

Elastic or inelastic depending on whether the price is increasing or decreasing

In order to constitute an oligopolistic market structure.

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There must be a few firms in a given relevant market

There must be a few firms selling in a national market

There must be more than 20 firms selling in the international market

There must be fewer than 15 firm is any given market

The income effect of a price change

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Is always positive

Is always negative

May be positive or negative

Is associated with a change in nominal income

When oligopolistic firms interacting with one another each choose their best strategy given the strategies chosen by other firm in the market we have

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A cartel

The perfect competitive outcome

The Nash equilibrium

Monopolistic competiton

Economic growth is shown on the production possibility frontier as.

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The curvature of the PPF

An inward shift in the PPF

An outward shifts in the PPF

A movement from one point on the PPF to another

An oligopolistic industry can be characterized by all of the following except

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May sellers

mutual interdependence

Economies of scale

A homogenous product

If average fixed cost is 40 and average variable cost is 80 for a given output we the know that average total cost is.

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40

¹²⁰

80

None of the above

If the price of an apple increases.

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Its opportunity cost decreases

Its opportunity cost increases

The substitution effect does not occur

The income effect does not occur

In pure monopoly there is.

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A lot of firms

Two firms

A single firm

Many firms

Which of the following taxes is regressive

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The federal income tax

The state income tax

The sales tax

The Medicare tax

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