Have you micro economics mcq subject in your academic course exam? If yes, you can prepare Micro economics mcq with answer set 2. After all set of mcq, must give online exam quiz and assess your knowledge.
MCQ of Micro economics set 2
Q1. Budget line is also known as the —–
a. price line
b. market line
c. Both A and B
Answer
a. price line
Q2. The slope of indifference curve indicates the —–
a. marginal rate of substitution
b. Cost of substitution
c. Both A and B
Answer
a. marginal rate of substitution
Q3. The consumer is —– about any two points on the indifference curve.
a. indifferent
b. different
c. None of these
Answer
a. indifferent
Q4. The concept of Ordinal Utility was given by —–
a. J.R. Hicks
b. Adam Smith
c. None of these
Answer
a. J.R. Hicks
Q5. Production refers to the —– of inputs or resources into output of goods and services.
a. indifferent
b. transformation
c. None of these
Answer
b. transformation
Q6. —– are the resources used in the production of goods and services and are generally classified into three broad categories – labour, capital and land or natural resources.
a. Inputs
b. limited
c. None of these
Answer
a. Inputs
Q7. —– are those that can be varied easily and on very short notice.
a. Invariable Inputs
b. Variable Inputs
c. None of these
Answer
b. Variable Inputs
Q8. The time period during which at least one input is fixed is called the —–
a. short run
b. long run
c. None of these
Answer
a. short run
Q9. Mathematically, the production function can also be shown as: —–
a. Q = f(X1, X2—–Xk)
b. Q = f(X1+X2)
c. None of these
Answer
a. Q = f(X1, X2—–Xk)
Q10. The MPP of factor is a change in —– resulting from a change in a factor of production.
a. output
b. input
c. Both A and B
Answer
a. output
Q11. Linear isoquant assumes —– substitutability of factors of production.
a. perfect
b. limited
c. Both A and B
Answer
a. perfect
Q12. Kinked isoquant assumes —– substitutability of factors of production.
a. limited
b. unlimited
c. Both A and B
Answer
a. limited
Q13. Kinked isoquant assumes —– substitutability of capital and labour.
a. unlimited
b. limited
c. None of these
Answer
b. limited
Q14. —– is the slope of a given isoquant.
a. Marginal Rate of Technical Substitution
b. Marginal cost
c. Both A and B
Answer
a. Marginal Rate of Technical Substitution
Q15. As per Law of Variable Proportions, when MP is equal to AP, AP is at its —–
a. maximum
b. minimum
c. None of these
Answer
a. maximum
Q16. In the third stage of Law of Diminishing Returns, there are —– marginal returns.
a. negative
b. postive
c. Both A and B
Answer
a. negative
Q17. A sensible firm would like to operate in the —– stage of production.
a. second
b. third
c. None of these
Answer
a. second
Q18. In —– stage of production, any additional input employed would lead to a fall in output.
a. first
b. third
c. Both A and B
Answer
b. third
Q19. In —– returns to scale, the proportionate increase in input is not equal to the proportionate change in output.
a. increasing and decreasing
b. increasing
c. None of these
Answer
a. increasing and decreasing
Q20. As we added more and more of variable input to a fixed input, the amount of extra product will —–
a. call off
b. fall off
c. Both A and B
Answer
b. fall off
Q21. Under decreasing return to scale increase in output is —– than proportionate to the increase in input.
a. less
b. more
c. None of these
Answer
a. less
Q22. Increasing return to scale are due to —– and/or managerial indivisibilities.
a. technical
b. formal
c. Both A and B
Answer
a. technical
Q23. Technical indivisibilities cause —– returns to scale.
a. increasing
b. decreasing
c. None of these
Answer
a. increasing
Q24. In the long run, output can be —– by increasing the scale of operations.
a. increased
b. decreased
c. Both A and B
Answer
a. increased
Q25. Shut-down costs are required to be incurred when the production operations are —–
a. restore
b. suspended
c. None of these
Answer
b. suspended
Q26. When the income elasticity is equal to 1, the good is said to be income inelastic.
a. True
b. False
Answer
b. False
Q27. For complementary goods, the cross elasticity will always be positive.
a. True
b. False
Answer
b. False
Q28. With more units of consumption total utility increases and marginal utility also increases.
a. True
b. False
Answer
b. False
Q29. Incremental costs include only variable cost.
a. True
b. False
Answer
b. False
Q30. Explicit costs cannot be regarded as paid out costs.
a. True
b. False
Answer
b. False
Q31. Fixed costs can be altered in short run.
a. True
b. False
Answer
b. False
Q32. In a perfect market there is products differentiation.
a. True
b. False
Answer
b. False
Q33. In a perfect market a change in the output of a single firm will affect the market price of the product.
a. True
b. False
Answer
b. False
Q34. In perfect market, market agents are not fully aware of market.
a. True
b. False
Answer
b. False
Q35. Industry has no role in the determination of price under perfect competition.
a. True
b. False
Answer
b. False
Q36. When the supply of a commodity decreases and its demand remains constant then it leads to decrease in price.
a. True
b. False
Answer
b. False
Q37. Monopoly represents an efficient use of resources at the macro level.
a. True
b. False
Answer
b. False
Q38. A firm in the long-run under monopolistic competition earns high profits like that in perfect competition but only the price is higher and output lower.
a. True
b. False
Answer
b. False
Q39. Selling costs cannot change, and create demand curves.
a. True
b. False
Answer
b. False
Q40. Monopolistic competition is identified by a few firms producing a slightly differentiated product.
a. True
b. False
Answer
b. False
Other Micro Economics Exam MCQ set
- Micro economics mcq with answer set 1
- Micro economics mcq with answer set 2
- Micro economics mcq with answer set 3
- Micro economics mcq with answer set 4
- Micro economics mcq with answer set 5
