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Business Economics - Business Economics Section 2 Online Exam Quiz

Important questions about Business Economics - Business Economics Section 2. Business Economics - Business Economics Section 2 MCQ questions with answers. Business Economics - Business Economics Section 2 exam questions and answers for students and interviews.

1. Which of the following is the correct Statement

Options

A : Under perfect competition, a firm determine its price where AR = IVIR

B : In a perfectly competitive industry, a firm is in equilibrium in the short run only when it is AC = AR = IVIR = MC.

C : The short-run supply curve has a negative slope

D : A firm is a price-taker under perfect competition.

2. Which of the following is the best general definition of the study of economics

Options

A : lnflation and employment in a growing economy.

B : The best way to invest in the stock market

C : Business decision making under foreign competition

D : Individual and social choice in the face of scarcity.

3. As per the indifference curve and price line, a consumer will not be in equilibrium when

Options

A : Ratios of marginal utilities and price of the respective goods are equal

B : The ratio of marginal utilities of the two goods is equal to the ratio of their respective prices

C : The marginal rate of substitution is equal to the ratio of prices of the two goods.

D : The marginal rate of substitution is decreasing.

4. Opportunity cost means

Options

A : Cost of a Homogeneous product

B : Cost of the Last unit

C : Cost of next best alternative

D : Cost of all units produced.

5. Price discrimination is profitable and possible of the two markets have

Options

A : Equal Elasticity of Demand

B : Different Elasticity of Demand

C : Inelastic demand

D : High Elastic Demand

46. the perfectly competitive firm will always expand output as long as

Options

A : Rising marginal cost is less than the average cost

B : Rising marginal cost is less than the marginal revenue

C : Rising marginal cost is less than the price

D : None of the above

47. The Law of Equi-marginal utility tells that if the price of a commodity falls

Options

A : More units of it will be bought

B : Same units of it will be bought

C : Fewer units of it will be marginal bought

D : Nothing of it will be bought

48. A demand curve is a boundary concept because it shows

Options

A : The minimum price and minimum quantity

B : The maximum price and minimum quantity

C : The maximum quantity and the minimum price

D : Both price and quantity is maximum

49. Under the perfect competition, the transportation cost

Options

A : Is considered to be negligible and thus, ignored

B : Is charged along with the price of the commodity

C : Is considered to be vital for the calculation of the total cost

D : Excluded from the prime cost

50. A monopoly producer has

Options

A : Control over production but not price

B : Control over production, price, and consumers

C : Control neither on production nor on price

D : Control overproduction as well as price

51. Under perfect market and in case of decreasing marginal cost the firm's equilibrium with respect to level of production

Options

A : Cannot be achieved

B : Can be achieved after a high level of output

C : Can be achieved after a small level of output

D : Will result in run-away inflation

52. Law of diminishing marginal utility states

Options

A : Utility always diminishes whether something is consumed or not

B : Total utility diminishes with the consumption of every additional unit

C : Utility first increases and after that diminishes at every point

D : The additional benefit which a person derives from a given increase of his stock of a thing diminishes with every increase in the stock that he already has.

53. The concept of supply curve as used in economic theory is relevant only for the case of

Options

A : Oligopoly

B : Perfect or pure competition

C : Monopolistic competition

D : Monopoly

54. In perfect competition, there is a process of

Options

A : Restricted entry and exit of the firms

B : Free entry and free exit of the firms

C : Free entry but the restricted exit of the firms

D : Semi-free exit but absolute free entry

55. In the short run, the law of variable proportions is also known as the

Options

A : Law of constant returns

B : Law of diminishing returns

C : Law of increasing returns

D : Law of return to scale

56. In the perfect competition in the short run, the firm is a price .......... and can sell... ... amount of output at the going market price.

Options

A : Taker, any

B : Taker, a definite

C : Maker, Any

D : None of the above

57. A profit-maximizing monopolist in two separate markets will

Options

A : Always charge a higher price in the market where he sells less

B : Always charge a higher price in the market where he sells more

C : Charge the same price in both markets

D : Adjust his sales in the two markets so that his MR in each market just equals his aggregate marginal cost

58. Under a bilateral monopoly, the price is higher if

Options

A : The monopolist has his way

B : The monopsonist has his way

C : The monopolist acts as a competitor

D : The monopsonist sells his own product in a monopoly market

59. A monopoly producer usually earns

Options

A : Abnormal profits

B : Neither profits nor losses

C : Only normal profits

D : Profits and losses which are uncertain

60. The size of a monopolist's plant and the degree of utilization of any given plant size, depend entirely on the

Options

A : Factor price

B : Price of the good

C : Market demand

D : Market Supply

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