Question # 1

When there is a surplus in a market

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There is downward pressure on price

There is upward pressure on price

The market could still be in equilibrium

There are too many buyers chasing too few goods.

The are price elasticity of demand is approximately

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0.3

3.3

6.0

0.2

Ti access internet services consumers must use a computer if computer prices fall, what is the effect on the demand for internet services.

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The demand for internet services increases.

The demand for internet services decreases

The demand for internet services does not change

The demand for internet services could increase, decrese, or stay the same depending on other factors.

In perfect competition a firm is.

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Price taker

Price setter

Independent

Dependent

A monopoly market.

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Generally falls to maximize total economic well being.

Always maximizes total economic well being.

always minimizes consumers surplus

Generally falls to maximum produce surplus

If the estimated values of Y and Py in 1987 are Rs. 30,000 and Rs. 8 respectively the marginal revenue of X is.

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260 - 160 x

420 - 4Qx

240 - 16 Px

80 - 4Qx

Along the long run supply curve all of the following can vary except.

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The level of profits

The number of firms in the industry

Input prices

The level of input usage

MC = MR= AR=AC = Price shows the longs run

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Monopolist firm

Oligopolistic firm

Competitive firm

Both a and b

According to Keynes, when the great depression started the government should be.

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Done nothing

Decreased the money supply

Had a large increase in government spending.

Enacted high tariffs such as the smoot Hawley tariff

A monopsony is

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The scale supplier of an input

The scale supplier of an output

The sole buyer of some type of input

A unionized industry

How much will a speculator invest now if he expects to earn Rs. 144 two years from now assuming the nominal rate of interest is 20%

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Rs.1654.29

Rs.100.00

Rs.94.00

Rs.68.00

In monopolistic competition firm sell

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Same goods

Differential goods

Inferior goods

Superior goods

Suppose an individual spends all his income on only two goods, good X and good Y moreover suppose that you were asked to derive his price consumption curve for good Y Which of the following would be allowed to very.

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Money income

The tastes of the consumer

The price of good X

The price of good Y

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

An entrepreneur who collects profits in the short run for a new invention is collecting.

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The competitive rate of return on capital

Temporary monopoly profit

Rent

A Ramsey surplus

Cardinal approach theory was presented by

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Marshall

Adam smith

Robbins

Hicks

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

The Marginal cost of product W exhibiting positive externalities is McW = 25 + 5 Qs, the competitive price for each unit of W (Pw) is Rs. 175 and the positive externality is worth Rs. 100 to society for each unit produced. Society considers product W under produced by how many units.

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10 Units

15 Units

20 Units

5 units

change in quantity demanded

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Downward shift of demand curve

Movement on the same demand curve

Downward shift

None of these

Price discrimination is possible

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Oligopoly

Duopoly

Perfect competition

Monopoly

Which of the following is correct for the demand and supply schedules given above.

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The demand curve is non linear

The slope of the supply curve is 4

Equilibrium quantity is 40 units

The slope of the demand curve is 0.5

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