Business Economics Online MCQ Set 9

QN01. The no. of firms under oligopoly is

1. 1
2. 2
3. many
4. few

Answer

(D)few

QN02. Growth curve approach is used for forecasting demand of ______________ products

1. New
2. Old
3. Existing
4. Both old and existing.

Answer

(A)New

QN03. A positive income elasticity may be

1. Unit income elasticity
2. Income elasticity greater than unity
3. Income elasticity less than unity
4. Any of the above

Answer

(D)Any of the above

QN04. The concept of Elasticity of Demand was introduced by

1. Alfred Marshall
2. Lionel Robbins
3. Adam smith
4. J M Keynes

Answer

(A)Alfred Marshall

QN05. When the quantity demanded falls due to a rise in price, it is called

1. Extension
2. Upward shift
3. Downward shift
4. Contraction

Answer

(D)Contraction

QN06. Determinants of demand includes

1. Price of a commodity
2. Nature of commodity
3. Income and wealth of consumer
4. All the above

Answer

(D)All the above

QN07. Exceptional Demand Curve (Perverse demand curve)

1. Moving upward from left to right
2. Moving upward from right to left
3. Moving horizontally
4. Moving vertically

Answer

(A)Moving upward from left to right

QN08. Purposes of long term Demand forecasting doesn’t includes;

1. Planning of a new unit or expansion of existing unit.
2. Planning long term financial requirements.
3. Planning of manpower requirements.
4. Deciding suitable price policy

Answer

(D)Deciding suitable price policy

QN09. Which of the following method of pricing is popular in wholesale and retail trades

1. skimming
2. penetrating
3. full cost pricing
4. target pricing

Answer

(C)full cost pricing

QN10. ______________ is an "objective assessment of the future course of demand"

1. Demand Estimation
2. Demand analysis
3. Demand function
4. Demand forecasting

Answer

(D)Demand forecasting

QN11. The change in demand due to change in price only, where other factors remaining constant, it is called ______________

1. Shift in demand
2. Extension of demand
3. Contraction of demand
4. Both extension and contraction

Answer

(D)Both extension and contraction

QN12. In the above function, the letter T stands for

1. Target price
2. Total supply
3. Total consumption
4. Taste and preference of consumers

Answer

(D)Taste and preference of consumers

QN13. ______________ means relationship between demand and its various determinants expressed mathematically

1. Demand extension
2. Demand contraction
3. Demand analysis
4. Demand function

Answer

(D)Demand function

QN14. " ______________ in economics means demand backed up by enough money to pay for the goods demanded"

1. Utility
2. Consumption
3. Supply
4. Demand

Answer

(D)Demand

QN15. In the case of ______________ a small change in price leads to very big change in quantity demanded

1. Perfectly elastic demand
2. Perfectly inelastic demand
3. Relative elastic demand
4. Unit elastic demand

Answer

(D)Unit elastic demand

QN16. Basic assumptions of law of demand does not include

1. There is no change in consumers' taste and preference
2. Income should remain constant.
3. Prices of other goods should change.
4. There should be no substitute for the commodity

Answer

(C)Prices of other goods should change.

QN17. in the case of perfect inelasticity, the demand curve is

1. Vertical
2. Horizontal
3. Flat
4. Steep

Answer

(A)Vertical

QN18. Purposes of long term Demand forecasting includes

1. Making a suitable production policy.
2. To reduce the cost of purchasing raw materials and to control inventory.
3. Deciding suitable price policy
4. Planning of a new unit or expansion of existing unit

Answer

(D)Planning of a new unit or expansion of existing unit

QN19. Pricing is done on the basis of managerial decisions, not on the basis of cost, demand etc…

1. Managerial pricing
2. Administered pricing
3. Full cost pricing
4. Competitive pricing

Answer

(B)Administered pricing

QN20. The pricing of cup of tea or coffee, is an example of

1. Mark up pricing
2. Marginal cost pricing
3. Conventional pricing
4. Cost plus pricing

Answer

(C)Conventional pricing

QN21. The product under monopolistic competition are

1. differentiated with close substitute
2. perfect substitute
3. differentiated without close substitute
4. homogeneous

Answer

(A)differentiated with close substitute

QN22. Production may be defined as an act of:

1. Creating utility
2. Earning profit
3. Destroying utility
4. Providing services

Answer

(A)Creating utility

QN23. When all the productive services are increased in a given proportion, the product is increased in the same proportion. This situation is called:

1. Law of increasing
2. Situation of constant returns
3. Fixed cost
4. Variable cost

Answer

(B)Situation of constant returns

QN24. Which are not the features of oligopoly?

1. Few sellers
2. Advertising and sales promotion
3. One firm
4. Conflicting attitudes of firms

Answer

(C)One firm

QN25. Whenever marginal cost is more than ______________ average total cost is falling:

1. Average total revenue
2. Average total cost
3. Average profit
4. All of these

Answer

(B)Average total cost

QN26. ______________ is situation with increased investment and increased price

1. Recession
2. Progress
3. Boom
4. Recovery

Answer

(C)Boom

QN27. The "law of variable proportion" is first explained by

1. Edward west
2. Marshall
3. Veblen
4. Keynes

Answer

(A)Edward west

QN28. A graph indicating different combination of inputs with different level of output is called

1. Iso-cost map
2. BEP map
3. Input-output map
4. Iso-quant map

Answer

(D)Iso-quant map

QN29. Which of the following is a short run law?

1. Law of constant return to scale
2. Law of increasing return to scale
3. Law of diminishing return
4. None of these

Answer

(C)Law of diminishing return

QN30. Related to production function, MRTS stand for;

1. Marginal revenue and total sales
2. Minimum revenue from total sales
3. Marginal rate of total supply
4. Marginal rate of technical substitution

Answer

(D)Marginal rate of technical substitution

QN31. In perfect completion, a firm is a

1. Price maker
2. Price taker
3. Both of the above
4. None of these

Answer

(B)Price taker

QN32. Which of the following is not a feature of monopolistic completion?

1. Large number of producers
2. Free entry and exit
3. More elastic demand
4. Price competition

Answer

(D)Price competition

QN33. The famous book on economics “An Enquiry into the Nature and Cause of Wealth of Nation” was Written by

1. Alfred Marshall
2. Adam Smith
3. J M Keynes
4. ACPigou

Answer

(B)Adam Smith

QN34. Welfare (neo classical) definition of economics is given by

1. J B Say
2. Lionel Robbins
3. Adam Smith
4. Alfred Marshall

Answer

(D)Alfred Marshall

QN35. The author of the book "The General Theory of Employment, Interest and Money"

1. Alfred Marshall
2. Adam Smith
3. J M Keynes
4. ACPigou

Answer

(C)J M Keynes

QN36. ______________ is micro economic theory

1. Demand theory
2. Price theory
3. Income theory
4. None of these

Answer

(B)Price theory

QN37. Managerial economics is also called

1. Micro economics
2. Theory of the firm
3. Economics of the firm
4. All of the above.

Answer

(D)All of the above.

QN38. Basic economic tools of managerial economics does not include

1. Principle of time perspective
2. Equi-marginal principle
3. Incremental principle
4. None of these

Answer

(D)None of these

QN39. The demand has three essentials-Desire, Purchasing power and ______________

1. Quantity
2. Cash
3. Supply
4. Willingness to purchase

Answer

(D)Willingness to purchase

QN40. In the above function, the letters Ps stands for

1. Preference of consumers
2. Price of commodity
3. Price of substitutes
4. Product supply

Answer

(C)Price of substitutes