Question # 1

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

Which of the following concepts represents the extra revenue a firm neceives from the services of an additional unit of a factor of production.

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Total revenue

Marginal physical product

Marginal revenues product

Marginal revenue

Immediately after a through we would expect to have al

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Peak

Recession

Recovery

Another trough

In perfect competition price is settled by

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Sellers

Buyers

Producers

Both a and b

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

Law of variable proportion is also called.

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Law of non proportion returns

Law of substitution

Law of casts

Law of demand

change in quantity demanded

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Downward shift of demand curve

Movement on the same demand curve

Downward shift

None of these

Marginal cost is the change is cost the result from a one unit increase in.

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Price

Cost

Output

Revenue

In monopolistic competition firm sell

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Same goods

Differential goods

Inferior goods

Superior goods

When goods are compliments the cross demand curve

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Upward to the right

Backward to bottom

Inwards to the right

Downwards to right

If the price of factor A is Rs.8.00 per hour, and its marginal product is 10 units, and the price of factor B is Rs. 5.00 and its marginal product is 9, is the producer is likely to.

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Hire more of A and less of B

Hire more of B and less of A

Start paying factor A more

Try to use factor B more productively

Which of the following is an automatic stabilizer.

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Unemployment benefits

Spending on education

Defense spending

Net interest

In perfect competition there is.

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Many buyers

Many sellers

Homogeneous product

All of these

Micro economics studies such topics as

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The factors that determine inflation

The forces that influence the price of shoes

The determinants of total output

Whether the unemployment rate will rise or fall

The Isoquant curve shows different combinations of two factors of production which give the producer.

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Different level of output

High level of output

low level of output

Same level of output

Because a monopoly hires workers up to the point where their marginal revenue product equals the wage rate the monopoly will.

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Pay less than the going wage rate

Pay a wage equal to the value of the marginal product of labor

Pay less than the value of the marginal product of labor

Pay workers what they are worth to society

A linear homogenous production function would reveal.

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Constant returns to scale

Increasing returns to scale

Decreasing return to scale

Doubling all inputs would more than double output

The price elasticity of demand will increase with the length of the period to which the demand curve pertains because.

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Consumers incomes will increase

The demand curve will shift toward

All prices will increase over time

Consumers will be better able to find substitutes

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

Some goods are not closely related to each other and are neither substitutes nor complements for such goods the cross price elasticity of demand would be.

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Positive

Negative

Zero

Cannot tell without more information

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

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