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Managerial Economics – 1

Posted by scdlpapers on July 21st, 2010

LIST OF ATTEMPTED QUESTIONS AND ANSWERS

Multiple Choice Single AnswerQuestionThe concept of Perfect competition includes all the features of :-Correct AnswerPure competitionYour AnswerPure competition

Multiple Choice Single AnswerQuestionAn entrepreneur may earn high profits just by luck, say because of outbreak of war. This isknown as :-Correct AnswerChance ProfitsYour AnswerMonopoly Profits

Multiple Choice Single AnswerQuestionManagerial economics is also understood to refer toCorrect Answerapplied economicsYour Answerapplied economics

Multiple Choice Multiple AnswerQuestionFeatures of Dumping are :-Correct AnswerIt is possible in the case of monopoly market , Selling same good at higher price in home market

and at lower price in international market , It is encouraged with a view to promote the exportsYour AnswerIt is possible in the case of monopoly market , It is encouraged with a view to promote theexports

Multiple Choice Single AnswerQuestionThe type economic problem is

http://scdlpapers.in/2010/07/managerial-economics-1/







Correct AnsweruniversalYour Answeruniversal

True/FalseQuestionIn macro – economic analysis the behavior of economic agents such as firms, households andgovernment is seen in total, disregarding details at particular level.Correct AnswerTrueYour AnswerTrue

True/FalseQuestion

Changes in the value of money because of inflation, make inventory valuation of finishedproducts difficult.Correct AnswerTrueYour AnswerTrue

Multiple Choice Single AnswerQuestionThe method of inventory valuation in which, the cost of production is calculated on theassumption that the material which was last to enter the inventory of the company was used first

is :-Correct AnswerLIFOYour AnswerLIFO

Multiple Choice Single AnswerQuestionThe act of making goods and services is calledCorrect AnswerproductionYour Answerproduction

Select The Blank QuestionThe partnership between private sector & government is called ________.Correct AnswerJoint sector enterprise



Your AnswerJoint sector enterprise

Multiple Choice Multiple AnswerQuestion

According to Keynes there are three motives for holding cash for liquidity preference :-Correct AnswerThe speculative motive , The transactions motive , The precautionary motiveYour AnswerThe transactions motive , The precautionary motive , The speculative motive

Multiple Choice Single AnswerQuestionIf the substitutes are relatively costly then the demand for the commodity in question will be :-Correct AnswerMore

Your AnswerMore

Multiple Choice Multiple AnswerQuestionThe Laws of Returns to scale are :-Correct AnswerLaw of Increasing Returns to Scale , Law of Constant Returns to Scale , Law of DecreasingReturns to scaleYour AnswerLaw of Decreasing Returns to scale

Multiple Choice Multiple AnswerQuestionIncreasing Returns explains :-Correct AnswerTotal product increases at an increasing rate , Marginal product increasing and it is maximum ,Average product is increasing but it is below MPYour AnswerTotal product increases at an increasing rate , Marginal product increasing and it is maximum ,Average product is increasing but it is below MP

Multiple Choice Single AnswerQuestionAn individual consumer or particular market for a given commodity are the subject matter of :-Correct AnswerMicro EconomicsYour AnswerMicro Economics



True/FalseQuestionThe prosperity phase is characterized by rise in the level of employment.Correct AnswerTrue

Your AnswerTrue

Select The Blank QuestionBaumol has suggested as an alternative objective for profit maximization, the maximization of ________.Correct AnswerSalesYour AnswerSales

Multiple Choice Single AnswerQuestionThe profit which is surplus of revenue over and above all paid out cost is :-Correct AnswerAccounting ProfitYour AnswerGross Profit

Select The Blank Question

In perfect competition various factors of production are assumed to be ________.Correct AnswerPerfectly mobileYour AnswerPerfectly mobile

Select The Blank QuestionKeynes, on the basis of a fundamental psychological law, observed that as income ________,consumption Increases.Correct AnswerIncreasesYour AnswerIncreases

True/FalseQuestionDuring the period of depression, a large part of a country‟s resources lie involuntarily idle. Correct Answer



TrueYour AnswerTrue

True/False

QuestionPure private goods are completely divisible and to them the principle of exclusion applies in fullmeasure.Correct AnswerTrueYour AnswerFalse

Select The Blank QuestionThe taxation & public expenditure policies are called as ________ ..

Correct AnswerBudgetary PolicyYour AnswerBudgetary Policy

Multiple Choice Multiple AnswerQuestionThe disinvestments of industries is needed for :-Correct AnswerPhased privatization , Reducing deficit , Capital support to plansYour Answer

Phased privatization , Reducing deficit , Capital support to plansMultiple Choice Single AnswerQuestionThe act of using goods and services to satisfy wants is calledCorrect AnswerconsumptionYour Answerconsumption

Multiple Choice Single AnswerQuestionThe things that are produced by factors of production are calledCorrect AnswercommoditiesYour Answercommodities



Select The Blank QuestionIn the context of externalities, driving the smoke-emitting buses and trucks in the cities is anexample of ________ cost.Correct Answer

SocialYour AnswerSocial

Multiple Choice Single AnswerQuestionThe concept of just distribution of national product is aCorrect AnswernormativeYour Answernormative

True/FalseQuestionThe government also fixes minimum procurement prices for major crops on the recommendationof the Agricultural Prices Commission (APC).Correct AnswerTrueYour AnswerTrue

Multiple Choice Multiple Answer

QuestionAccording to Lionel Robbins definition of economics, “Economics is a science which : -Correct AnswerStudies human behaviour , Relationship between ends and scares resources , Scarce means havealternate usesYour AnswerStudies human behaviour , Relationship between ends and scares resources , Scarce means havealternate uses

Select The Blank QuestionUnder perfect competition, price is determined by the interaction of total demand and ________.Correct AnswerTotal supplyYour AnswerTotal selling cost




Features of monopolistic Competition are :-Correct AnswerFairly large number of firms , Product differentiation , Selling costs are existedYour AnswerFairly large number of firms , Product differentiation , Selling costs are existed

Multiple Choice Multiple AnswerQuestionSteps in cost benefit analysis are :-Correct AnswerIdentification of a project , Formulation of the project , Appraisal and selection of the projectYour AnswerIdentification of a project , Formulation of the project , Appraisal and selection of the project

True/FalseQuestion

There is no separation of ownership and management in case of a Joint Stock Company.Correct AnswerFalseYour AnswerFalse

Multiple Choice Single AnswerQuestionDuring a period of rising prices (inflation), the goods and services are :-Correct AnswerScarce

Your AnswerScarce

Multiple Choice Single AnswerQuestionThe cost recorded in the books of accounts are considered as :-Correct AnswerExplicit costsYour AnswerExplicit costs

Multiple Choice Single AnswerQuestionVariable cost are those costs which vary with the level of :-Correct AnswerOutputYour AnswerOutput



Select The Blank QuestionOpen market operations measures are ________.Correct AnswerQuantitative credit control

Your AnswerQuantitative credit control

Select The Blank QuestionManagerial ________ lies on the borderline of management and Economics.Correct AnswerEconomicsYour AnswerEconomics

True/FalseQuestionThe demand for life saving drugs is elastic.Correct AnswerFalseYour AnswerFalse

Multiple Choice Single AnswerQuestionManagerial economics generally refers to the integration of economic theory with business

Correct AnswerPracticeYour AnswerPractice

Match The FollowingQuestionCorrect AnswerYour AnswerResource allocation decisions in free market economyTheory of priceTheory of priceEconomic problemUniversalUniversalManagerial EconomicsApplied branch of knowledgeApplied branch of knowledgeInflation



Reduction in purchasing powerReduction in purchasing powerWaste of resourcesInvoluntary unemploymentInvoluntary unemployment

Multiple Choice Single AnswerQuestionAccording J.B.Clark, profit is the reward paid for :-Correct AnswerDynamismYour AnswerRisk bearing


The characteristics of a sole proprietorship firm is :-Correct AnswerUnlimited Capital , Ownership by a single person , Easy to formYour AnswerOwnership by a single person , Easy to form

Select The Blank QuestionThe rate of interest, according to Keynes depends upon two factors: the liquidity preferencefunction and ________.Correct Answer

The quantity of money.Your AnswerThe quantity of money.

Match The FollowingQuestionCorrect AnswerYour AnswerHuman wantsunlimitedunlimitedGeneral Theory of Employment, Interest and MoneyJ. M. KeynesJ. M. KeynesManagerial economicsDecision making and forward planningDecision making and forward planningResourcesscarce



scarceCommoditiesgoods and servicesgoods and services

Multiple Choice Single AnswerQuestionEvery nation‟s resources which are used to produce the quantities of goods and services thatwould be required to satisfy all its citizen‟s want s areCorrect AnswerinsufficientYour Answerinsufficient



List Of Attempted Questions And Answers

Select The Blank Question The sum of all individual demands constitutes________Correct Answer market demandYour Answer market demand

True/FalseQuestion Under perfect competition, price is determined by the interaction of total demand andtotal supply in the market.Correct Answer FalseYour Answer True

Multiple Choice Single AnswerQuestion Price of a product under perfect competition is determined by the interaction of totalsupply andCorrect Answer total demandYour Answer total demand

Select The Blank Question The cost which enter the accounts book of the firm are referred as ________.Correct Answer Accounting costYour Answer Accounting cost

Multiple Choice Multiple AnswerQuestion Keynes‟s theory of employment explai nsCorrect Answer Effective demand , Aggregate supply , Aggregate demandYour Answer Effective demand , Aggregate supply , Aggregate demand








Multiple Choice Single AnswerQuestion The type economic problem isCorrect Answer universalYour Answer universal

Multiple Choice Single AnswerQuestion An individual consumer or particular market for a given commodity are the subjectmatter of Correct Answer Micro EconomicsYour Answer Micro Economics

Multiple Choice Multiple AnswerQuestion Features of the firm areCorrect Answer It is a business unit organized under one ownership , It is a sole proprietorship ,It is a partnership or joint stock companyYour Answer It is a business unit organized under one ownership , It is a sole proprietorship , It

is a partnership or joint stock company

Multiple Choice Single AnswerQuestion Whether the economy‟s capacity to produce goods and services is growing from year toyear or remaining static is studied under theCorrect Answer Theory of economic growthYour Answer Theory of economic growth

Multiple Choice Multiple AnswerQuestion Co-operative organizations isCorrect Answer voluntary organization , managed by democratic principle , organization, which

performs its business within the membersYour Answer voluntary organization , managed by democratic principle , non profit motiveorganization

Multiple Choice Multiple AnswerQuestion Assumptions underlying the law of Supply areCorrect Answer The cost of production is unchanged , No change in technique of production ,Government policies are unchangedYour Answer The cost of production is unchanged , No change in technique of production ,Government policies are unchanged

True/FalseQuestion Macro-economies is a policy oriented science.Correct Answer TrueYour Answer True

Multiple Choice Single AnswerQuestion Expansion of supply is shown by the movement in the supply curve which is



Correct Answer upwardYour Answer upward

Multiple Choice Single AnswerQuestion Liability of a sole trader is

Correct Answer unlimitedYour Answer unlimited

Select The Blank Question If the output rises in the greater proportion than that of the increase in factor inputs, it isreferred to as ________.Correct Answer increasing returns to scale.Your Answer increasing returns to scale.

Select The Blank Question An upward sloping demand curve is called ________

Correct Answer exceptional demand curveYour Answer exceptional demand curve

Multiple Choice Single AnswerQuestion Every nation‟s resources which are used to produce the quantities of goods and servicesthat would be required to satisfy all its citizen‟s wants are Correct Answer insufficientYour Answer insufficient

Multiple Choice Single AnswerQuestion The act of making goods and services is called

Correct Answer productionYour Answer production

Multiple Choice Single AnswerQuestion Question related to the efficient production and allocation belong to the branch of economic theory calledCorrect Answer Welfare EconomicsYour Answer Welfare Economics

Multiple Choice Single AnswerQuestion The act of using goods and services to satisfy wants is called

Correct Answer consumptionYour Answer consumption

Multiple Choice Multiple AnswerQuestion Explicit costs areCorrect Answer Out of pocket costs , These are firms accounting expenses , Expenditure costsYour Answer Out of pocket costs , These are firms accounting expenses , Expenditure costs



Select The Blank Question In the 3rd stage of operation of the law of variable proportions, the marginal productbecomes ________.Correct Answer negativeYour Answer negative

True/FalseQuestion The Keynesian theory emphasizes effective supply as a crucial factor in determiningthe level of income and employment.Correct Answer FalseYour Answer False

Multiple Choice Single AnswerQuestion The things that are produced by factors of production are calledCorrect Answer commoditiesYour Answer commodities

Select The Blank Question By „ profits‟, the accountant means total revenue minus________. Correct Answer Explicit costsYour Answer Explicit costs

Multiple Choice Single AnswerQuestion All the buyers and sellers operating under perfect competition have knowledge whichisCorrect Answer perfectYour Answer perfect

Match The FollowingQuestion Correct Answer Your Answer

Resource allocation decisions in free market economy Theory of price Theory of priceEconomic problem Universal UniversalManagerial Economics Applied branch of knowledge Applied branch of knowledgeInflation Reduction in purchasing power Theory of priceWaste of resources Involuntary unemployment Involuntary unemployment


Question 16. The phase of recovery denotesCorrect Answer More employment opportunities , Increase in profitability , Wage rate increaseYour Answer More employment opportunities , Increase in profitability , Wage rate increase

Select The Blank Question Supply is predominantly determined by ________.Correct Answer stock Your Answer demand



Select The Blank Question The form of organization which is best for self employment is ________.Correct Answer Sole traderYour Answer Sole trader

Multiple Choice Single AnswerQuestion The suggestion of maximization of balanced growth rate as another alternativeobjective of a firm‟s profit is suggested by Correct Answer Prof. MorrisYour Answer Baumol

True/FalseQuestion Under perfect competition,firms are free to enter and exit in the market.Correct Answer TrueYour Answer True

Multiple Choice Single AnswerQuestion J.M. Keynes, on the basis of a fundamental psychological law of consumption,observed that as income increases, consumption also increases, but proportionatelyCorrect Answer lessYour Answer less

Multiple Choice Single AnswerQuestion The Risk theory of profit was developed byCorrect Answer HawleyYour Answer Hawley

True/FalseQuestion The congress government led by Narsimha Rao announced the New Industrial Policyin July 1991.Correct Answer TrueYour Answer True

Select The Blank Question Perfectly elastic demand curve is ________Correct Answer horizontalYour Answer horizontal

True/FalseQuestion The distinction between fixed costs and variable costs is relevant in the short periodonly.Correct Answer TrueYour Answer True

Multiple Choice Multiple AnswerQuestion The term externalities may also be referred as:



Correct Answer Spill-over effects , Neighborhood effects , Third party effectsYour Answer Spill-over effects , Neighborhood effects , Third party effects

Multiple Choice Multiple AnswerQuestion Methods of forecasting demand for new products are

Correct Answer Product life cycle analysis , Test marketing , Evolutionary approachYour Answer Evolutionary approach

Multiple Choice Single AnswerQuestion Often monopolies purposely keep certain factors of production idle creating artificialscarcities of their products as a result the pricesCorrect Answer riseYour Answer rise

Multiple Choice Multiple AnswerQuestion The methods of calculating depreciation is

Correct Answer Diminishing Balance Method , Annuity Method , Service Unit MethodYour Answer Diminishing Balance Method , Annuity Method , Service Unit Method


Human wants unlimited unlimitedGeneral Theory of Employment, Interest and Money J. M. Keynes J. M. KeynesManagerial economics Decision making and forward planning Decision making and forwardplanningResources scarce scarce

Commodities goods and services goods and servicesSelect The Blank Question In the context of formulating an investment project, ________ feasibility means theavailability of supervisors for implementing and running the project smoothly and professionally.Correct Answer managementYour Answer management

True/FalseQuestion The sum of total fixed costs and total variable costs is the total cost.Correct Answer True

Your Answer TrueMultiple Choice Multiple AnswerQuestion Features of Market areCorrect Answer Place where buyers and sellers meet each other , A building where a number of shops dealing in a particular commodity exist , A place where transaction of goods and servicesis undertakenYour Answer Place where buyers and sellers meet each other , A building where a number of



shops dealing in a particular commodity exist , A place where transaction of goods and servicesis undertaken

Multiple Choice Single AnswerQuestion Managerial economics is also understood to refer to

Correct Answer applied economicsYour Answer applied economics

True/FalseQuestion Private profit motive is an essential feature of Capitalism.Correct Answer TrueYour Answer True




True/FalseQuestionIn case of a proprietary firm the liability of the proprietor is limited.Correct AnswerFalseYour AnswerFalse

Multiple Choice Multiple AnswerQuestionAccounting profit includes :-Correct AnswerWages , Rent , InterestYour AnswerInterest , Total revenue

True/FalseQuestionIn experimental price approach the firms takes some cognizance of the demand for the productand proceeds to fix a price by a trial and error method.Correct AnswerTrueYour AnswerTrue









Defects of market system:-Correct AnswerInequalities of income and wealth , Emergence of monopolies , Failure to provide fullemploymentYour Answer

Emergence of monopolies , Failure to provide full employment , Prevailing of barter system

Multiple Choice Single AnswerQuestionIn case of perfectly elastic supply, the supply curve is :-Correct AnswerHorizontalYour AnswerVertical

Multiple Choice Single Answer

QuestionEvery nation‟s resources which are used to produce the quantities of goods and services thatwould be required to satisfy all its citizen‟s wants are Correct AnswerinsufficientYour Answerinsufficient

Multiple Choice Single AnswerQuestionManagerial economics is also understood to refer to

Correct Answerapplied economicsYour Answerapplied economics

Multiple Choice Single AnswerQuestionEconomists have pointed out that the real world is full of :-Correct AnswerImperfect competitionYour AnswerPure competition

Multiple Choice Multiple AnswerQuestionCharacteristics of Pure Public goods are:-Correct AnswerThey are completely indivisible , Their marginal cost would be zero or close to zero , Theirbenefits cannot be priced



Your AnswerThey are completely indivisible , Their benefits cannot be priced


Main aims of the New Industrial Policy (1991) are :-Correct AnswerTo unshackle the Indian industrial economy from the cobwebs of unnecessary bureaucraticcontrol , To introduce liberalization with a view to integrate the Indian economy with the worldeconomy , To remove restrictions on direct foreign investment as also to free the domesticentrepreneur from the restriction of MRTP actYour AnswerTo unshackle the Indian industrial economy from the cobwebs of unnecessary bureaucraticcontrol , To introduce liberalization with a view to integrate the Indian economy with the worldeconomy , To remove restrictions on direct foreign investment as also to free the domesticentrepreneur from the restriction of MRTP act

Multiple Choice Single AnswerQuestionUnder perfect competition, generally demand and supply act and react upon each other anddetermine the priceCorrect AnswerequilibriumYour Answerequilibrium


QuestionFactors leading to differences in the economic & the traditional concepts of valuation are :-Correct AnswerInventory Valuation , Depreciation , Unaccounted value changes in the assets & liabilitiesYour AnswerInventory Valuation , Depreciation , Unaccounted value changes in the assets & liabilities

Select The Blank QuestionSuper-normal profit is also called ________.Correct AnswerExcess profitYour AnswerExcess profit

Multiple Choice Multiple AnswerQuestionUnder cost plus pricing :-Correct Answer



Actual costs, standard costs are included , Certain percentage of profit also included , The priceis set to cover material, labour costYour AnswerThe price is set to cover material, labour cost , Actual costs, standard costs are included

Match The FollowingQuestionCorrect AnswerYour AnswerHuman wantsunlimitedunlimitedGeneral Theory of Employment, Interest and MoneyJ. M. KeynesJ. M. KeynesManagerial economics

Decision making and forward planningDecision making and forward planningResourcesscarcescarceCommoditiesgoods and servicesgoods and services

True/FalseQuestionConsumer‟s protection involves protection to t

he consumers from unfair trade practices.Correct AnswerTrueYour AnswerTrue

Select The Blank QuestionWhen Government repays old loans, the purchasing power at the disposal of the people________.Correct AnswerIncreasesYour AnswerBecomes negative

True/FalseQuestionThe law of supply is not hypothetical.Correct Answer



FalseYour AnswerTrue


QuestionA firm gets an opportunity to produce multiple products because changes in business activity in afirms is :-Correct AnswerCyclicalYour AnswerCyclical

True/FalseQuestionWhen a change in income has no effect upon the quantity demanded of a product, the income

elasticity of demand is zero.Correct AnswerTrueYour AnswerTrue

Multiple Choice Single AnswerQuestionManagerial economics generally refers to the integration of economic theory with businessCorrect AnswerPractice

Your AnswerPractice

Select The Blank QuestionPropensity to consume is defined as the relationship between consumption and ________.Correct AnswerIncomeYour AnswerIncome

True/FalseQuestionPublic enterprises have shown a very high rate of return of the capital invested.Correct AnswerFalseYour AnswerFalse



Select The Blank Question________ effects are those externalities which flow from the production or use of the good toother parties or economic units.Correct Answer

Third partyYour AnswerExternal

True/FalseQuestionIn the traditional concept of equilibrium, a firm attains the equilibrium when the firm‟s TotalRevenue (T.R.) =Total Cost (T.C.).Correct AnswerFalseYour Answer

TrueMultiple Choice Single AnswerQuestionThe method of inventory valuation in which, the cost of production is calculated on theassumption that the material which was last to enter the inventory of the company was used firstis :-Correct AnswerLIFOYour AnswerLIFO

True/FalseQuestionSupply management is related to the volume of supply & its distribution system.Correct AnswerTrueYour AnswerTrue

Multiple Choice Multiple AnswerQuestionDemand is determined by :-Correct AnswerPrice of the product , Relative prices of other goods , Tastes and habitsYour AnswerPrice of the product , Relative prices of other goods , Tastes and habits




Different types of Elasticity of Demand are :-Correct AnswerCross elasticity of demand , Price elasticity of demand , Income elasticity of demandYour AnswerPrice elasticity of demand , Income elasticity of demand , Cross elasticity of demand

Multiple Choice Single AnswerQuestionIn case of a Joint-Stock Company, the liability of share holders is :-Correct AnswerLimitedYour AnswerLimited

Multiple Choice Single AnswerQuestion

Expansion of supply is shown by the movement in the supply curve which is :-Correct AnswerUpwardYour AnswerUpward

Multiple Choice Single AnswerQuestionSaving is a :-Correct AnswerPrivate virtue

Your AnswerPrivate virtue

Multiple Choice Single AnswerQuestionAccording to the Government, the building up of inflationary pressure during the Nineties wasattributed to :-Correct AnswerHigher Fiscal deficitYour AnswerHigher Fiscal deficit

Multiple Choice Multiple AnswerQuestionA competitive industry has three basic characteristics :-Correct AnswerLarge Number of Firms , Homogeneous Product , Free entry and exitYour AnswerLarge Number of Firms , Homogeneous Product , Free entry and exit



Multiple Choice Single AnswerQuestionThe income which a businessman might expect from the second best alternative use of hisresources is called as :-Correct Answer

Opportunity costYour AnswerOpportunity cost

Select The Blank QuestionAdvertising forms an integral part of decision-making and________.Correct AnswerForward – planningYour AnswerForward – planning

Multiple Choice Multiple AnswerQuestionExceptions to the Law of Demand are :-Correct AnswerGriffin goods , Articles of snob appeal , SpeculationYour AnswerGriffin goods , Articles of snob appeal , Speculation


True inflation starts only after reaching ________.Correct AnswerLevel of full employmentYour AnswerLevel of full employment

Select The Blank QuestionThe financing of ________ goods is done through Public expenditure.Correct AnswerPublicYour AnswerPublic

Multiple Choice Multiple AnswerQuestionAssumptions of the Law of Demand are :-Correct Answer

No change in consumer‟s income , No change in consumer‟s preferences , No change in fashion



Your Answer No change in consumer‟s income , No change in consumer‟s preferences , No change in fashion


Types of Share capital of Joint-Stock Company are :-Correct AnswerRegistered or authorized capital , Issued capital , Paid-up capitalYour AnswerRegistered or authorized capital , Issued capital , Paid-up capital

True/FalseQuestionThe sum of total fixed costs and total variable costs is the total cost.Correct AnswerTrue

Your AnswerTrue

True/FalseQuestionDuring the period of depression, a large part of a country‟s resources lie involuntarily idle. Correct AnswerTrueYour AnswerTrue

True/FalseQuestionUnder the New Industrial Policy, in order to invite foreign investment in high priority industries,it was decided to provide approval for direct foreign investment upto 51% equity in suchindustries.Correct AnswerTrueYour AnswerTrue




Multiple Choice Single AnswerQuestionEconomists call all human resources as








Correct AnswerlaborYour Answerlabor

True/FalseQuestionEconomic problem arises only in case of an overpopulated country.Correct AnswerFalseYour AnswerFalse

Multiple Choice Single AnswerQuestionAll the buyers and sellers operating under perfect competition have knowledge

Correct AnswerperfectYour Answerperfect

True/FalseQuestionThe meaning of the word “economic” is most closely associated with the word unlimited Correct AnswerTrueYour Answer

TrueMultiple Choice Single AnswerQuestionThe conditions of equilibrium of a firm are applicable to all marketsCorrect AnswerNoneYour Answerparticular

True/FalseQuestionIn case of the co-operative societies supplying cheap inputs or supplying consumer products atfair prices, a system of subsidized pricing is followedCorrect AnswerTrueYour AnswerTrue



Multiple Choice Single AnswerQuestionThe price of a good and the exclusion princople together isCorrect Answerdivisibility

Your Answerindivisibility

Multiple Choice Single AnswerQuestionThe liability of a sole proprietary firm isCorrect AnswerunlimitedYour Answerunlimited

True/FalseQuestionInstitution of private property is not an essential feature of CapitalismCorrect AnswerFalseYour AnswerFalse

True/FalseQuestionThere never was in any country at any time „pure capitalism‟ or „pure communism

Correct AnswerTrueYour AnswerTrue

True/FalseQuestionThe railways using a lot of coal in firing the steam locomotives put the residential and otherareas near the loco – shades to a lot of sufferings on account of smoke nuisance, is an example of prCorrect AnswerFalseYour AnswerTrue

True/FalseQuestionA Joint stock company has perpetual succession.Correct Answer



TrueYour AnswerTrue

True/False

QuestionThe management of the cooperative form of business organization is totalitarian in nature.Correct AnswerFalseYour AnswerTrue

Multiple Choice Single AnswerQuestionIn Trade cycles the economic activity areCorrect Answer

ups and downsYour Answerups and downs

True/FalseQuestionIn macro – economic analysis the behavior of economic agents such as firms, households andgovernment is seen in total, disregarding details at particular levelCorrect AnswerTrueYour Answer

TrueMultiple Choice Single AnswerQuestionMarket economy or private enterprise economy is a economy which isCorrect AnswerplanlessYour Answerplanned

Multiple Choice Single AnswerQuestionNew commodities due to technotogical progress may result in demand for traditional type of goodsCorrect AnswerdecreaseYour Answerdecrease



Multiple Choice Single AnswerQuestionIf a person is habituated to the consumption of a commodity and if he cannot easily give up itsuse, demand for it is generallyCorrect Answer

inelasticYour Answerinelastic

Match The FollowingQuestionCorrect AnswerYour AnswerNormal demand curveDownwards to rightDownwards to right

Income consumption curveUpwards to the rightUpwards to the rightInelastic demand curveVertical straight lineVertical straight lineCross elasticity of demand between two perfect substitute will beInfinityInfinityA demand curve, which takes the form of a horizontal line parallelto the quantity axis illustrateselasticityInfinity.Infinity.

Multiple Choice Single AnswerQuestionThe law of diminishing returns is applicable to agriculture provided the state of technology isgiven andCorrect AnswerconstantYour Answerresources

Multiple Choice Single AnswerQuestionUnder the system of dual prices in case of essential goods, adopted by the government, theweaker sections of the community are supplied these goods through fair price shops whiCorrect Answerfair



Your Answerneo – rich


The Government attempts to increase supplies of food grains and other essential goods in timesof internal shortage through largerCorrect AnswerimportsYour Answerborrowings

True/FalseQuestionExternal economies are the advantages of large scale production enjoyed exclusively anindividual firm alone.

Correct AnswerFalseYour AnswerFalse

Multiple Choice Multiple AnswerQuestionEquilibrium isCorrect AnswerThe stage of maximum satisfaction , The stage of balance , The stage of stationaryYour Answer

The stage of balanceMultiple Choice Multiple AnswerQuestionConditions of equilibriumCorrect AnswerMarginal Revenue should be equal to Marginal Cost , The Marginal cost curve should cut themarginal revenue curve from below at the equilibrium point , Marginal cost curve should beincreasing at equilibrium pointYour AnswerMarginal Revenue should be equal to Marginal Cost , The Marginal cost curve should cut themarginal revenue curve from below at the equilibrium point , Average cost curve should cut theAverage Revenue curve

Select The Blank QuestionCost-benefit analysis refers to the analysis undertaken to judge any projects ________ whethergovernment or private and find out its ________ and facilities its comparison with otheravailable oppor



Correct AnswerinvestmentsYour AnswerinvestmentsCorrect Answer

worthYour Answerprofit

Multiple Choice Multiple AnswerQuestionAggregate supply functionCorrect AnswerRefers to that price at which the seller is willing to supply , Refers to show the varying level of supply at different prices , Explains the level of out put varies with the level of employmentYour Answer

Refers to show the varying level of supply at different pricesMultiple Choice Multiple AnswerQuestionCharacteristics of DepressionCorrect AnswerDecrease in economic activities , The growth rate becomes negative , The level of nationalincome declines rapidlyYour AnswerDecrease in economic activities , The growth rate becomes negative , The level of nationalincome declines rapidly

Multiple Choice Multiple AnswerQuestionRecession includesCorrect AnswerThe demand is halted , Increase in production of goods , Inventories piling up in stocksYour AnswerThe demand is halted , Inventories piling up in stocks , The growth of discrepancy betweensupply and demand is very fast

Multiple Choice Multiple AnswerQuestionThe causes of inflationCorrect AnswerIncrease in public expenditure , Increase in private expenditure , Increase in foreign demandYour AnswerIncrease in public expenditure , Increase in foreign demand , Increase in taxation



Select The Blank QuestionIn the ________ terminology, the ________ demand function refers to the schedule of maximumsales proceeds, which the entrepreneurial community actually does expect to be received fromthe sale of

Correct AnswerKeynesianYour AnswerKeynesianCorrect AnsweraggregateYour Answertotal


The rate of interest, according to ________ , depends upon two factors: (i) ________ and (ii) thequantity of moneyCorrect AnswerKeynesYour AnswerKeynesCorrect Answerthe liquidity preference functionYour Answerspeculative

Multiple Choice Multiple AnswerQuestionReasons for need of public distribution systemCorrect AnswerTo maintain stable price conditions , An efficient management of the supply , To supply thenecessary goods to people at reasonable priceYour AnswerTo maintain stable price conditions , An efficient management of the supply , To supply thenecessary goods to people at reasonable price

Multiple Choice Multiple AnswerQuestionThe consumer protection Act includesCorrect AnswerProtection from hazardous commodities , Right to a competitive price , Right to informationregarding protectionYour AnswerProtection from hazardous commodities , Right to information regarding protection , Protestagainst price discrimination



Multiple Choice Multiple AnswerQuestionObjectives of economic policyCorrect AnswerTo increase the efficiency and international competitiveness of industrial production , To

improve the performance and rationalize the scope of the public sector , To reform andmodernize the financial sectorYour AnswerTo increase the efficiency and international competitiveness of industrial production , Toimprove the performance and rationalize the scope of the public sector , To reform andmodernize the financial sector

Multiple Choice Multiple AnswerQuestionScope of Managerial Economics deals with:Correct Answer

Demand analysis and forecasting. , Production function & cost analysis. , Inventory managementadverting, price system.Your AnswerDemand analysis and forecasting. , Production function & cost analysis. , Inventory managementadverting, price system.

Multiple Choice Multiple AnswerQuestionAssumptions of the Law of Demand are:Correct Answer

No change in consumer‟s income , No change in consumer‟s preferences , No change in fashion

Your Answer No change in consumer‟s income , No change in consumer‟s preferences , No change in fashion ,No Change in government policy.

Multiple Choice Multiple AnswerQuestionTypes of income elasticity of demandCorrect AnswerNegative income elasticity , Zero income elasticity , Unit income elasticityYour AnswerNegative income elasticity , Zero income elasticity , Unit income elasticity

Select The Blank QuestionManagerial ________s generally refers to the integration of economic theory with ________practice.Correct AnswereconomicYour Answer



economicCorrect AnswerbusinessYour Answerbusiness

Select The Blank QuestionThe problem of unlimited wants and limited ________ with ________ uses has been foreverconfronting mankind.Correct AnswermeansYour AnswermeansCorrect Answeralternative

Your Answeralternative

Select The Blank QuestionAs per the International Labour Organisation (ILO), _ ________ is a ________ association of individuals with limited income on the basis of equal rights and responsibilities for achievingcertaCorrect AnswerCo-operationYour Answer

Co-operationCorrect AnswervoluntaryYour Answervoluntary

Select The Blank QuestionLike all organism, the ________ , too is an organism, according to the ________ theory.Correct AnswerfirmYour AnswerfirmCorrect Answerlife-cycle theoryYour Answerhomeostatic theory



Select The Blank QuestionThe ________-taking theory was developed by the ________ . According to him, profit arisesbecause considerable amount of risk is involved in business.Correct Answer

American economist HawleyYour Answerrisk Correct Answerrisk Your AnswerAmerican economist Hawley

Select The Blank QuestionThe extent of the change of demand for a commodity to a given change in ________ , other

demand determinants remaining constant, is termed as the ________ of demand.Correct AnswerpriceYour AnswerpriceCorrect Answerprice elasticityYour Answerprice elasticity

Select The Blank

QuestionIndices constructed for one ________ should not be ________ for other purposes where they notbe fully appropriate and given erroneous conclusions.Correct AnswerpurposeYour AnswerpurposeCorrect AnswerusedYour Answerused

Select The Blank QuestionThe law of diminishing returns states that, „as the proportion of one factor in a combination of factors is ________ after a point, first the ________ and then the average product of that factor wCorrect AnswerincreasedYour Answer



increasedCorrect AnswermarginalYour Answermarginal

Match The FollowingQuestionCorrect AnswerYour AnswerStatutory Reserve RatioQuantitative credit Control MeasureQuantitative credit Control MeasureTrade cycleWave – like movementWave – like movement

Keynesian theoryShort – Period AnalysisJ. M. KeynesAggregate Demand FunctionMaximum sale proceeds expected by entrepreneursShort – Period AnalysisEffective DemandJ. M. KeynesMaximum sale proceeds expected by entrepreneurs




Multiple Choice Single AnswerQuestionManagerial economics generally refers to the integration of economic theory with businessCorrect AnswerPracticeYour Answer

Practice

Multiple Choice Single AnswerQuestionEvery nation‟s resources which are used to produce the quantities of goods and services thatwould be required to satisfy all i ts citizen‟s wants are Correct Answerinsufficient








Your Answerinsufficient


Managerial economics is also understood to refer toCorrect Answerapplied economicsYour Answerapplied economics

Multiple Choice Single AnswerQuestionThe type economic problem isCorrect Answeruniversal

Your Answeruniversal


Multiple Choice Single AnswerQuestionThe act of using goods and services to satisfy wants is calledCorrect AnswerconsumptionYour Answerconsumption

Multiple Choice Single AnswerQuestionThe concept of just distribution of national product is aCorrect AnswernormativeYour Answerobjective

True/FalseQuestionResources are said to be involuntarily un employed when their wastage occur.




Match The FollowingQuestionCorrect AnswerYour AnswerManagerial economicsDecision making and forward planningDecision making and forward planningResourcesscarcescarceCommodities

goods and servicesgoods and servicesHuman wantsunlimitedunlimitedGeneral Theory of Employment, Interest and MoneyJ. M. KeynesJ. M. Keynes


In cost –

benefit analysis, after the step of appraisal and selection of the project is the step of Correct Answercomparison of the cash flowYour Answercomparison of the cash flow

True/FalseQuestionSocial costs cannot be included in a firm‟s account book.Correct AnswerTrueYour AnswerFalse

Multiple Choice Multiple AnswerQuestionSteps in cost benefit analysisCorrect AnswerIdentification of a project , Formulation of the project , Appraisal and selection of the project



Your AnswerIdentification of a project , Formulation of the project , Appraisal and selection of the project


The advantage of cost-benefit analysis areCorrect AnswerMaximization of social welfare , Objective measurement of the trade-off , Maximization of difference between total benefits & total costsYour AnswerMaximization of social welfare , Objective measurement of the trade-off , Maximization of difference between total benefits & total costs

Select The Blank QuestionCost-Benefit analysis aims at ________ of social wealth.

Correct AnswermaximizationYour Answermaximization

Select The Blank QuestionModern economists treat social cost and benefits as ________ of private investment andproduction decisions.Correct Answerexternalities

Your Answerexternalities

Multiple Choice Single AnswerQuestionAccording to many economists, the root cause of economic problem isCorrect AnswerscarcityYour Answerscarcity

Multiple Choice Single AnswerQuestionManagerial economics aims at providing guidance to the firms forCorrect Answerdecision makingYour Answerdecision making



Multiple Choice Single AnswerQuestionIn case of a Joint-Stock Company, the liability of share holders isCorrect Answerlimited

Your Answerlimited

Multiple Choice Single AnswerQuestionFor an economist, Tata Eng & Locomotive Company Ltd is aCorrect AnswerfirmYour Answerfirm

Multiple Choice Multiple AnswerQuestionPreference Shares can be classified asCorrect AnswerSimple Shares , Cumulative Shares , Redeemable SharesYour AnswerSimple Shares , Cumulative Shares , Redeemable Shares

Multiple Choice Multiple AnswerQuestionThe promoters of a company can get incorporated by filing with the registrarof companies

various documents such asCorrect AnswerMemorandum of Association , Articles of Association , ProspectusYour AnswerMemorandum of Association , Articles of Association

Multiple Choice Multiple AnswerQuestionForms of Public EnterprisesCorrect Answerdepartmental management , company management or management by boards , publiccorporationsYour Answerdepartmental management , public corporations , non-profit organization

Select The Blank QuestionBaumol has suggested as an alternative objective for profit maximization , the maximization of ________



Correct AnswersalesYour Answersales

Select The Blank QuestionThe partnership between private sector & government is called ________Correct AnswerJoint sector enterpriseYour AnswerJoint sector enterprise

Select The Blank QuestionThe minimum number of directors which public limited should have is ________.

Correct Answer3Your Answer3

Multiple Choice Single AnswerQuestionThe profit which is surplus of revenue over and above all paid out cost isCorrect AnswerAccounting ProfitYour Answer

Gross ProfitTrue/FalseQuestionMeasurement of profit becomes difficult because of the difficulty involved in the calculation of depreciation.Correct AnswerTrueYour AnswerTrue

Multiple Choice Single AnswerQuestionIn economics, demand means desire backed by adequateCorrect Answerpurchasing powerYour Answerpurchasing power



Multiple Choice Single AnswerQuestionWhen more units of a commodity are purchased in response to decline in price of thatcommodity, it is called as expansion of Correct Answer

demandYour Answerdemand

Multiple Choice Single AnswerQuestionDemand for products like tea, betel, tobacoo, sigaratte is a matter of Correct AnswerhabitYour Answerhabit

Multiple Choice Single AnswerQuestionIf the substitutes are relatively cheaper then the demand for the commodity in question will beCorrect AnswerlessYour Answerless

True/FalseQuestion

A shift in the demand curve to the left shows increase in demand.Correct AnswerFalseYour AnswerFalse

True/FalseQuestionDemand for luxury goods is inelasticCorrect AnswerFalseYour AnswerFalse

True/FalseQuestionThe demand for life saving drugs is elastic.Correct AnswerFalse



Your AnswerFalse


A normal demand curve has ________+B299Correct Answernegative slopeYour Answernegative slope

Multiple Choice Multiple AnswerQuestionCost function denotesCorrect AnswerThe prices of such inputs as labour and capital material , The rate of output , The size of the plant

Your AnswerThe prices of such inputs as labour and capital material , The rate of output , The size of the plant, The cost of technology

Select The Blank QuestionThe law of constant returns to scale is depicted by the marginal output curve which is ________.Correct AnswerhorizontalYour Answerupward sloping

Select The Blank QuestionIn the 3rd stage of operation of the law of variable proportions, the marginal product becomes________.Correct AnswernegativeYour Answernegative

Select The Blank QuestionThe costs which cover the cost of advertising is ________.Correct AnswerSelling costYour AnswerSelling cost



Multiple Choice Multiple AnswerQuestionFeatures of Oligopoly Market areCorrect AnswerFew sellers , Restriction to entry of new firms , Price leadership

Your AnswerFew sellers , Restriction to entry of new firms , No Advertisement cost

Multiple Choice Single AnswerQuestionSaving is aCorrect Answerprivate virtueYour Answersocial virtue

True/FalseQuestionDuring periods of inflation, the income of farmers as a class decreases.Correct AnswerTrueYour AnswerFalse

True/FalseQuestionTo solve the unemployment problem , the level of effective demand must decrease.

Correct AnswerFalseYour AnswerFalse

Match The FollowingQuestionCorrect AnswerYour AnswerProsperityExpansion of creditContraction of creditThe general theory of employment, Interest and moneyJ.M. KeynesJ.M. KeynesTrade cycleWave like movementWave like movementStatutory reserve ratio



Quantitative credit control measureQuantitative credit control measure


The characteristics of Inflation areCorrect AnswerExcess of demand , Sustained rise in prices , Cannot be anticipatedYour AnswerSustained rise in prices , Cannot be anticipated , It is limited to some geographical areas

True/FalseQuestionMarket system or market economy suffers from time to time from economic depressions.Correct AnswerTrue

Your AnswerTrue

Multiple Choice Multiple AnswerQuestionMain aims of the New Industrial Policy (1991) areCorrect AnswerTo unshackle the indian industrial economy from the cobwebs of unnecessary bureaucraticcontrol , To introduce liberalization with a view to integrate the indian economy with the worldeconomy , To remove restrictions on direct foreign investment as also to free the domesticentrepreneur from the restriction of MRTP act

Your AnswerTo unshackle the indian industrial economy from the cobwebs of unnecessary bureaucraticcontrol , To introduce liberalization with a view to integrate the indian economy with the worldeconomy , To remove restrictions on direct foreign investment as also to free the domesticentrepreneur from the restriction of MRTP act




Multiple Choice Single AnswerQuestionIn economics the question related to the selection of methods with which commodities areproduced is a subject matter of Correct Answertheory of production








Your Answertheory of production


In economics the questions related to the division of society‟s output of goods and servicesamong its members are topics inCorrect Answertheory of distributionYour Answertheory of distribution

Multiple Choice Single AnswerQuestionIn economics the questions related to the dynamic or static ( otherwise) capacity of the economyto produce goods and services are topics in the

Correct Answertheory of economic growthYour Answertheory of production

Multiple Choice Single AnswerQuestionAll the free gifts of nature which are commonly called natural resources are known toeconomists asCorrect AnswerLand

Your Answercapital

Multiple Choice Single AnswerQuestionAll the man made resources which are used in the process of making other goods and servicesare calledCorrect AnswercapitalYour Answerlabor

Multiple Choice Single AnswerQuestionManagerial economics aims at providing help in the firms isCorrect Answerdecision makingYour Answerdecision making



True/FalseQuestionEconomic problem is faced by poor countrys only.Correct AnswerFalse

Your AnswerFalse

Multiple Choice Single AnswerQuestionAn industry is a group of firms dealing in the same line of Correct AnswerbusinessYour Answerbusiness

True/FalseQuestionMicro-economics is primarily concerned with the problem of what, how and for whom toproduceCorrect AnswerTrueYour AnswerTrue

True/FalseQuestion

Pure public goods must be in the hands of public sector only.Correct AnswerTrueYour AnswerFalse

Select The Blank QuestionThe goods become ________ only when each individual has an access to the entire amount of itand its use by the individual does not reduce its availability to others.Correct AnswerindivisibleYour Answerpublic

Select The Blank QuestionThe externality which causes an economic gain or an economic loss to other economic units isalso referred to as ________ externality.



Correct AnswerPecuniaryYour AnswerEconomic

Select The Blank QuestionIn a market economy ________ is the best judge of personal interest.Correct AnswerindividualYour Answerfirm

Match The FollowingQuestionCorrect Answer

Your AnswerManagerial economicsDecision making and forward planningDecision making and forward planningResourcesScarceScarceCommoditiesGoods and servicesGoods and servicesHuman wants

UnlimitedUnlimited

Match The FollowingQuestionCorrect AnswerYour AnswerGeneral theory of employment, interest and moneyJ. M. KeynesJ. M. KeynesInflationReduction in purchasing powerReduction in purchasing powerServicesIntangible goodsIntangible goodsMethods of production of commoditiesTheory of productionTheory of production



Multiple Choice Multiple AnswerQuestionThe characteristics of a sole proprietorship firm isCorrect AnswerUnlimited Capital , Ownership by a single person , Easy to form

Your AnswerOwnership by a single person , Easy to form

Multiple Choice Multiple AnswerQuestionDifferent types of business organizations areCorrect Answerprivate sector , public sector , joint sectorYour Answerprivate sector , public sector , joint sector

Select The Blank QuestionReasonable profit target as an alternative to the objective of profit maximization was suggestedby ________.Correct AnswerJoel DeanYour AnswerJoel Dean


The form of organization which is best for self employment is ________.Correct AnswerSole traderYour AnswerSole trader

Multiple Choice Single AnswerQuestionEconomic Profit takes in to account theCorrect Answerimplicit costYour Answerimplicit cost

True/FalseQuestionIn any business, while formulating a profit policy, the possibility of emergence of rival firmsmust be taken in to accountCorrect Answer



TrueYour AnswerTrue


QuestionThe payments made out of the Gross Profit areCorrect AnswerRemuneration to factors of production , Depreciation , Maintenance ChargesYour AnswerRemuneration to factors of production , Depreciation , Maintenance Charges

Multiple Choice Multiple AnswerQuestionreasonable profit‟ are Correct Answer

Capital Attraction , Plough Back , Normal earningsYour AnswerCapital Attraction , Plough Back , Normal earnings

Multiple Choice Single AnswerQuestionComplementary goods are demandedCorrect Answer

jointlyYour Answerseparately

Multiple Choice Single AnswerQuestionEmergence of close substitutes to the commodity in question may bring about demand toCorrect AnswerdecreaseYour Answerdecrease

Multiple Choice Single AnswerQuestionThe demand for a commodity depends on the prices of its substitutes which areCorrect AnswerrelativeYour Answerrelative

True/FalseQuestion



Demand curve slopes downwards from left to right.Correct AnswerTrueYour AnswerTrue

Select The Blank QuestionThe index numbers which measure the changes in the general price level of a country refers to________Correct AnswerWholesale prices indexYour AnswerWholesale prices index


QuestionDifferent types of Elasticity of Demand areCorrect AnswerPrice elasticity of demand , Income elasticity of demand , Cross elasticity of demandYour AnswerPrice elasticity of demand , Income elasticity of demand , Cross elasticity of demand

Multiple Choice Single AnswerQuestionIf the increase in all factors leads to a less than proportionate increase in output, then the returnsto scale are

Correct AnswerdecreasingYour Answerdecreasing

True/FalseQuestionThe supply of factory made goods of daily consumption is inelastic.Correct AnswerFalseYour AnswerTrue

Multiple Choice Multiple AnswerQuestionMajor types of costs areCorrect AnswerAccounting costs , Economic costs , Opportunity costs



Your AnswerAccounting costs , Economic costs , Opportunity costs


Output rises in a lesser proportion to that of the increase in input, under the case of ________.Correct Answerdecreasing returns to scaleYour Answerdecreasing returns to scale

Select The Blank QuestionIf the output rises in the greater proportion than that of the increase in factor inputs, it is referredto as ________.Correct Answer

increasing returns to scale.Your Answerincreasing returns to scale.

Multiple Choice Single AnswerQuestionUnder monopoly the demand curve slopesCorrect AnswerdownwardYour Answerdownward

Multiple Choice Single AnswerQuestionDalal Street in Bombay is known asCorrect AnswerBombay Stock ExchangeYour AnswerBombay Stock Exchange

Multiple Choice Single AnswerQuestionThe city of Banaras has specialized in the manufacture of Correct Answersilk Your Answersilk

True/FalseQuestion



A firm under perfect competition is a price maker.Correct AnswerFalseYour AnswerFalse

True/FalseQuestionLong period supply is relatively inelastic.Correct AnswerFalseYour AnswerTrue


Features of the firm areCorrect AnswerIt is a business unit organized under one ownership , It is a sole proprietorship , It is a partnershipor joint stock companyYour AnswerIt is a business unit organized under one ownership , It is a sole proprietorship , It is a partnershipor joint stock company

Multiple Choice Multiple AnswerQuestionEquilibrium is the stage of

Correct Answermaximum satisfaction , balance , stationaryYour Answermaximum satisfaction , balance , stationary

True/FalseQuestionThe Keynesian theory emphasizes effective supply as a crucial factor in determining the level of income and employment.Correct AnswerFalseYour AnswerTrue

Multiple Choice Single AnswerQuestionAccording to the Government, the buildup of inflationary pressure during the Nineties wasattributed toCorrect Answer



Higher Fiscal deficitYour AnswerHigher Fiscal deficit

True/False

QuestionThe government also fixes minimum procurement prices for major crops on the recommendationof the Agricultural Prices Commission (APC).Correct AnswerTrueYour AnswerTrue

True/FalseQuestionThere is considerable slush money with politicians & Government servants.


Multiple Choice Multiple AnswerQuestionGovernment intervention is needed in free market mechanism toCorrect AnswerTo provide employment to all who willing to work at prevailing wage rate , Factors of production are optimally allocated between the various industries , All will get sufficient income

to meet their basic needsYour AnswerTo provide employment to all who willing to work at prevailing wage rate , Factors of production are optimally allocated between the various industries , All will get sufficient incometo meet their basic needs

Multiple Choice Multiple AnswerQuestionDefects of market system:Correct AnswerInequalities of income and wealth , Emergence of monopolies , Failure to provide fullemploymentYour Answer











Multiple Choice Single AnswerQuestionEconomists call all human resources asCorrect Answerlabor

Your Answerlabor

True/FalseQuestionEconomic problem arises only in case of an overpopulated country.Correct AnswerFalseYour AnswerFalse

Multiple Choice Single AnswerQuestionAll the buyers and sellers operating under perfect competition have knowledgeCorrect AnswerperfectYour Answerperfect

True/FalseQuestionThe meaning of the word “economic” is most closely associated with the word unlimited


Multiple Choice Single AnswerQuestionThe conditions of equilibrium of a firm are applicable to all marketsCorrect AnswerNoneYour Answerparticular

True/FalseQuestionIn case of the co-operative societies supplying cheap inputs or supplying consumer products atfair prices, a system of subsidized pricing is followedCorrect AnswerTrue



Your AnswerTrue


The price of a good and the exclusion princople together isCorrect AnswerdivisibilityYour Answerindivisibility

Multiple Choice Single AnswerQuestionThe liability of a sole proprietary firm isCorrect Answerunlimited

Your Answerunlimited

True/FalseQuestionInstitution of private property is not an essential feature of CapitalismCorrect AnswerFalseYour AnswerFalse

True/FalseQuestionThere never was in any country at any time „pure capitalism‟ or „pure communism Correct AnswerTrueYour AnswerTrue

True/FalseQuestionThe railways using a lot of coal in firing the steam locomotives put the residential and otherareas near the loco – shades to a lot of sufferings on account of smoke nuisance, is an example of prCorrect AnswerFalseYour AnswerTrue



True/FalseQuestionA Joint stock company has perpetual succession.Correct AnswerTrue

Your AnswerTrue

True/FalseQuestionThe management of the cooperative form of business organization is totalitarian in nature.Correct AnswerFalseYour AnswerTrue

Multiple Choice Single AnswerQuestionIn Trade cycles the economic activity areCorrect Answerups and downsYour Answerups and downs

True/FalseQuestionIn macro – economic analysis the behavior of economic agents such as firms, households and

government is seen in total, disregarding details at particular levelCorrect AnswerTrueYour AnswerTrue

Multiple Choice Single AnswerQuestionMarket economy or private enterprise economy is a economy which isCorrect AnswerplanlessYour Answerplanned

Multiple Choice Single AnswerQuestionNew commodities due to technotogical progress may result in demand for traditional type of goodsCorrect Answer



decreaseYour Answerdecrease


QuestionIf a person is habituated to the consumption of a commodity and if he cannot easily give up itsuse, demand for it is generallyCorrect AnswerinelasticYour Answerinelastic

Match The FollowingQuestionCorrect Answer

Your AnswerNormal demand curveDownwards to rightDownwards to rightIncome consumption curveUpwards to the rightUpwards to the rightInelastic demand curveVertical straight lineVertical straight lineCross elasticity of demand between two perfect substitute will be

InfinityInfinityA demand curve, which takes the form of a horizontal line parallelto the quantity axis illustrateselasticityInfinity.Infinity.

Multiple Choice Single AnswerQuestionThe law of diminishing returns is applicable to agriculture provided the state of technology isgiven andCorrect AnswerconstantYour Answerresources

Multiple Choice Single AnswerQuestionUnder the system of dual prices in case of essential goods, adopted by the government, the



weaker sections of the community are supplied these goods through fair price shops whiCorrect AnswerfairYour Answerneo – rich

Multiple Choice Single AnswerQuestionThe Government attempts to increase supplies of food grains and other essential goods in timesof internal shortage through largerCorrect AnswerimportsYour Answerborrowings

True/False

QuestionExternal economies are the advantages of large scale production enjoyed exclusively anindividual firm alone.Correct AnswerFalseYour AnswerFalse

Multiple Choice Multiple AnswerQuestionEquilibrium is

Correct AnswerThe stage of maximum satisfaction , The stage of balance , The stage of stationaryYour AnswerThe stage of balance

Multiple Choice Multiple AnswerQuestionConditions of equilibriumCorrect AnswerMarginal Revenue should be equal to Marginal Cost , The Marginal cost curve should cut themarginal revenue curve from below at the equilibrium point , Marginal cost curve should beincreasing at equilibrium pointYour AnswerMarginal Revenue should be equal to Marginal Cost , The Marginal cost curve should cut themarginal revenue curve from below at the equilibrium point , Average cost curve should cut theAverage Revenue curve




Cost-benefit analysis refers to the analysis undertaken to judge any projects ________ whethergovernment or private and find out its ________ and facilities its comparison with otheravailable opporCorrect Answerinvestments

Your AnswerinvestmentsCorrect AnswerworthYour Answerprofit

Multiple Choice Multiple AnswerQuestionAggregate supply functionCorrect Answer

Refers to that price at which the seller is willing to supply , Refers to show the varying level of supply at different prices , Explains the level of out put varies with the level of employmentYour AnswerRefers to show the varying level of supply at different prices

Multiple Choice Multiple AnswerQuestionCharacteristics of DepressionCorrect AnswerDecrease in economic activities , The growth rate becomes negative , The level of nationalincome declines rapidly

Your AnswerDecrease in economic activities , The growth rate becomes negative , The level of nationalincome declines rapidly

Multiple Choice Multiple AnswerQuestionRecession includesCorrect AnswerThe demand is halted , Increase in production of goods , Inventories piling up in stocksYour AnswerThe demand is halted , Inventories piling up in stocks , The growth of discrepancy betweensupply and demand is very fast

Multiple Choice Multiple AnswerQuestionThe causes of inflationCorrect AnswerIncrease in public expenditure , Increase in private expenditure , Increase in foreign demand



Your AnswerIncrease in public expenditure , Increase in foreign demand , Increase in taxation


In the ________ terminology, the ________ demand function refers to the schedule of maximumsales proceeds, which the entrepreneurial community actually does expect to be received fromthe sale of Correct AnswerKeynesianYour AnswerKeynesianCorrect AnsweraggregateYour Answertotal

Select The Blank QuestionThe rate of interest, according to ________ , depends upon two factors: (i) ________ and (ii) thequantity of moneyCorrect AnswerKeynesYour AnswerKeynesCorrect Answerthe liquidity preference function

Your Answerspeculative

Multiple Choice Multiple AnswerQuestionReasons for need of public distribution systemCorrect AnswerTo maintain stable price conditions , An efficient management of the supply , To supply thenecessary goods to people at reasonable priceYour AnswerTo maintain stable price conditions , An efficient management of the supply , To supply thenecessary goods to people at reasonable price

Multiple Choice Multiple AnswerQuestionThe consumer protection Act includesCorrect AnswerProtection from hazardous commodities , Right to a competitive price , Right to informationregarding protection



Your AnswerProtection from hazardous commodities , Right to information regarding protection , Protestagainst price discrimination


QuestionObjectives of economic policyCorrect AnswerTo increase the efficiency and international competitiveness of industrial production , Toimprove the performance and rationalize the scope of the public sector , To reform andmodernize the financial sectorYour AnswerTo increase the efficiency and international competitiveness of industrial production , Toimprove the performance and rationalize the scope of the public sector , To reform andmodernize the financial sector

Multiple Choice Multiple AnswerQuestionScope of Managerial Economics deals with:Correct AnswerDemand analysis and forecasting. , Production function & cost analysis. , Inventory managementadverting, price system.Your AnswerDemand analysis and forecasting. , Production function & cost analysis. , Inventory managementadverting, price system.


QuestionAssumptions of the Law of Demand are:Correct Answer

No change in consumer‟s income , No change in consumer‟s preference s , No change in fashionYour Answer

No change in consumer‟s income , No change in consumer‟s preferences , No change in fashion ,No Change in government policy.

Multiple Choice Multiple AnswerQuestionTypes of income elasticity of demandCorrect AnswerNegative income elasticity , Zero income elasticity , Unit income elasticityYour AnswerNegative income elasticity , Zero income elasticity , Unit income elasticity

Select The Blank QuestionManagerial ________s generally refers to the integration of economic theory with ________



practice.Correct AnswereconomicYour Answereconomic

Correct AnswerbusinessYour Answerbusiness

Select The Blank QuestionThe problem of unlimited wants and limited ________ with ________ uses has been foreverconfronting mankind.Correct Answermeans

Your AnswermeansCorrect AnsweralternativeYour Answeralternative

Select The Blank QuestionAs per the International Labour Organisation (ILO), _ ________ is a ________ association of individuals with limited income on the basis of equal rights and responsibilities for achieving

certaCorrect AnswerCo-operationYour AnswerCo-operationCorrect AnswervoluntaryYour Answervoluntary

Select The Blank QuestionLike all organism, the ________ , too is an organism, according to the ________ theory.Correct AnswerfirmYour AnswerfirmCorrect Answerlife-cycle theory



Your Answerhomeostatic theory


The ________-taking theory was developed by the ________ . According to him, profit arisesbecause considerable amount of risk is involved in business.Correct AnswerAmerican economist HawleyYour Answerrisk Correct Answerrisk Your AnswerAmerican economist Hawley

Select The Blank QuestionThe extent of the change of demand for a commodity to a given change in ________ , otherdemand determinants remaining constant, is termed as the ________ of demand.Correct AnswerpriceYour AnswerpriceCorrect Answerprice elasticityYour Answer

price elasticitySelect The Blank QuestionIndices constructed for one ________ should not be ________ for other purposes where they notbe fully appropriate and given erroneous conclusions.Correct AnswerpurposeYour AnswerpurposeCorrect AnswerusedYour Answerused

Select The Blank QuestionThe law of diminishing returns states th at, „as the proportion of one factor in a combination of factors is ________ after a point, first the ________ and then the average product of that factor w



Correct AnswerincreasedYour AnswerincreasedCorrect Answer

marginalYour Answermarginal

Match The FollowingQuestionCorrect AnswerYour AnswerStatutory Reserve RatioQuantitative credit Control MeasureQuantitative credit Control Measure

Trade cycleWave – like movementWave – like movementKeynesian theoryShort – Period AnalysisJ. M. KeynesAggregate Demand FunctionMaximum sale proceeds expected by entrepreneursShort – Period AnalysisEffective DemandJ. M. KeynesMaximum sale proceeds expected by entrepreneurs




Multiple Choice Single AnswerQuestionManagerial economics generally refers to the integration of economic theory with business

Correct AnswerPracticeYour AnswerPractice

Multiple Choice Single AnswerQuestionEvery nation‟s resources which are used to produce the quantities of goods and services that








would be required to satisfy all its citizen‟s wants are Correct AnswerinsufficientYour Answersufficient


True/FalseQuestion

Inflation reduces the purchasing power of money and savings.Correct AnswerTrueYour AnswerFalse

Multiple Choice Single AnswerQuestionThe supply curve during market period is perfectlyCorrect Answerinelastic

Your Answerinelastic


Match The FollowingQuestionCorrect AnswerYour AnswerManagerial economicsDecision making and forward planningDecision making and forward planning



Resourcesscarcegoods and servicesCommoditiesgoods and services

scarceHuman wantsunlimitedunlimitedGeneral Theory of Employment, Interest and MoneyJ. M. KeynesJ. M. Keynes

True/FalseQuestionThe price policy under monopolistic competition is dependent on the prices charged by other

rival firmsCorrect AnswerTrueYour AnswerFalse

Multiple Choice Single AnswerQuestionAll firms producing the same or similar product together makeCorrect Answeran industry

Your Answeran industry

Multiple Choice Single AnswerQuestionJoint Stock Company succession isCorrect AnswerperpetualYour Answerperpetual

True/FalseQuestionPrivate profit motive is an essential feature of CapitalismCorrect AnswerTrueYour AnswerTrue



True/FalseQuestion„Free riders‟ is a term associated with the people who would like to have benefit of a goodwithout sharing the cost of its supplyCorrect Answer

TrueYour AnswerFalse

Multiple Choice Single AnswerQuestionMacro – economics provides an exploration to the functioning of an economy inCorrect AnswergeneralYour Answergeneral

True/FalseQuestionInflation is a great opportunity for merchants to benefit more.Correct AnswerTrueYour AnswerTrue

True/FalseQuestion

The various phases of business cycles are shown by the line of cycle which moves up and downthe steady growth lineCorrect AnswerTrueYour AnswerTrue

True/FalseQuestionIn the measurement of profit, the differences in the concept of profit arise out of the differencesin cost conceptsCorrect AnswerTrueYour AnswerFalse

Multiple Choice Single AnswerQuestionIn economics demand means desire backed by adequate



Correct Answerpurchasing powerYour Answerability to pay

Multiple Choice Single AnswerQuestionThe law of diminishing returns is applicable to agriculture provided the state of technology isgiven andCorrect AnswerconstantYour Answerconstant


Under the monetary measures to control inflation, the R. B. I relies heavily on selective creditcontrols on bank loans against food grains, sugar, oils, oilseeds, cotton etc so as to discourageCorrect AnswerSpeculative hoardingYour AnswerSpeculative hoarding

Multiple Choice Single AnswerQuestionSlope of supply curve isCorrect Answer

positiveYour Answerpositive

Multiple Choice Single AnswerQuestionCosts which increase because of the expansion of a firm are called costsCorrect AnswerincrementalYour Answerincremental

True/FalseQuestionThe opportunity cost of a product is the opportunity gained of being able to produce some otherproduct.Correct AnswerFalse



Your AnswerFalse

True/FalseQuestion

The supply curve in case of unitary elastic supply is rectangular hyperbola.Correct AnswerFalseYour AnswerFalse

Multiple Choice Multiple AnswerQuestionAn IndustryCorrect AnswerIs a group of firms , All firms dealing in the same line of business , The ownership and

management of each firm is differentYour AnswerIs a group of firms , All firms dealing in the same line of business , The ownership andmanagement of each firm is different

Select The Blank QuestionUnder monopoly, there is ________ seller who controls the entire ________ in the marketCorrect Answeronly oneYour Answer

only oneCorrect AnswersupplyYour Answersupply

Select The Blank QuestionUnder monopsony, there are ________ sellers but ________ buyerCorrect AnswermanyYour AnswermanyCorrect Answeronly oneYour Answeronly one



Match The FollowingQuestionCorrect AnswerYour AnswerMarginal utility

Addition to total utilityAddition to total utilityTotal utility increases marginalPosative and decliningMarginal utility is zeroAt the saturation point for a commodity x the Mux isZeroDemand curve of a commodityMarginal utilities areDemand curve of a commodityPosative and declining

Total utility isMarginal utility is zeroZero

Select The Blank QuestionBy using cost-benefit analysis we can show the ________ necessary for attaining maximum________ and optimal policy aiming at this goalCorrect AnswermeasuresYour AnswerGross Domestic ProductCorrect Answernet wealthYour Answergross wealth

Multiple Choice Multiple AnswerQuestionAverage propensity to consumeCorrect AnswerIt is defined as the ratio of consumption expenditure to any particular level of income , It isfound by dividing consumption expenditure by income , It is expressed as the percentage of income consumedYour AnswerIt is derived by dividing income by consumption expenditure

Multiple Choice Multiple AnswerQuestionInflation means



Correct AnswerIt is a phenomenon of rising prices , It is a general and dynamic phenomenon , It includes anexcess of demandYour AnswerIt is a phenomenon of rising prices

Select The Blank QuestionAggregate supply function refers to a ________ of the various minimum amounts of proceeds or________ , which must be expected to be received by the entrepreneur class from the sale of output resultCorrect AnswerscheduleYour AnswerdemandCorrect Answer

revenuesYour Answerrevenues

Select The Blank QuestionIn the ________ terminology, the ________ demand function refers to the schedule of maximumsales proceeds, which the entrepreneurial community actually does expect to be received fromthe sale of Correct AnswerKeynesian

Your AnswerKeynesianCorrect AnsweraggregateYour Answeraggregate

Multiple Choice Multiple AnswerQuestionThe fiscal policy includesCorrect AnswerFormation of taxation policy , It is an instrument for economic stabilization , Monitoring of public expenditureYour AnswerFormation of taxation policy , It is an instrument for economic stabilization , Monitoring of public expenditure




The meaning of monetary policyCorrect AnswerIt is programme of the central bank , It controls the total supply of money , The basic objective isto achieve economic stabilityYour Answer

It is programme of the central bank , It controls the total supply of money , The basic objective isto achieve economic stability

Multiple Choice Multiple AnswerQuestionCauses for rise in prices in IndiaCorrect AnswerMounting government expenditure , Deficit financing and increase in money supply , Role of black moneyYour AnswerMounting government expenditure , Deficit financing and increase in money supply , Role of

black moneyMultiple Choice Multiple AnswerQuestionManagerial economics deals withCorrect AnswerIntegration of economic theory with business practice , Using logic of economics, mathematics& statistics. , The use of economic modes of thought to analyze business solution.Your AnswerIntegration of economic theory with business practice , Using logic of economics, mathematics& statistics.

Multiple Choice Multiple AnswerQuestionThe sources of economic problems are:Correct AnswerMan has unlimited wants or ends , The means or resources to satisfy them are limited. , Theseresources are not specific but have alternative uses.Your AnswerMan has unlimited wants or ends , The means or resources to satisfy them are limited. , Theseresources are not specific but have alternative uses.

Multiple Choice Multiple AnswerQuestionDifferent types of business organizations are;Correct AnswerPrivate sector. , Public sector. , Joint sector.Your AnswerJoint sector.



Multiple Choice Multiple AnswerQuestionProprietary firm isCorrect AnswerOwned by a single person. , Easy to form. , An organization of single person.

Your AnswerOwned by a single person.

Multiple Choice Multiple AnswerQuestionMethods of measurement of elasticityCorrect AnswerPercentage Method , Point elasticity Method , Total outlay expenditure methodYour AnswerPercentage Method , Point elasticity Method , Total outlay expenditure method

Multiple Choice Multiple AnswerQuestionDemand forecasts are necessary for:Correct AnswerFulfillment of objective of the plans , Preparation of a budget , Expansion of firmsYour AnswerPreparation of a budget , Expansion of firms

Select The Blank QuestionEconomic theory provides the basis for the ________ _ making process, there is some difference

between the generalization based on abstraction and actual practices. Besides economic theory,matCorrect Answerdecision makingYour AnsweroptimalCorrect AnswerstatisticsYour Answer

Select The Blank QuestionThe resources of a society consist not only of the free gifts of nature such as ________ but alsoof ________ and of all sorts of man made aids to further production.Correct Answerland and mineralsYour Answerland and mineralsCorrect Answer



human capacityYour Answerhuman capacity

Select The Blank

QuestionIndividual or sole ________ , which is also called sole- ________ , or single entrepreneurship isthe most common, the simplest and the oldest form of business organisation.Correct AnswerproprietorshipYour AnswerproprietorshipCorrect Answertrader shipYour Answertrader ship

Select The Blank QuestionNominal cost is the ________ cost of production, it is also called expenses of production. Thereal cost is the ________ cost of production.Correct AnswermoneyYour AnsweropportunityCorrect Answeropportunity

Your Answergross

Select The Blank QuestionCosts may be classified as : (a) ________ , including material costs, wage cost and interest cost(b) ________ , including costs of advertising and (c) other costs, including insurance chCorrect AnswerProduction costsYour AnswerProduction costsCorrect AnswerSelling costsYour AnswerSelling costs

Select The Blank QuestionThe costs of self owned resources, which are employed by the ________ , are non- expenditure



or , ________Correct AnswerfirmYour Answerfirm

Correct Answerimplicit costs .Your Answerimplicit costs .



Multiple Choice Single AnswerQuestionThe study of the working and allocation of resources in the free market economies is the topic intheCorrect Answertheory of priceYour Answertheory of production

Multiple Choice Single AnswerQuestionManagerial economics aims at providing help in the firms isCorrect Answerdecision makingYour Answerdecision making

True/FalseQuestionThe federal government of U.S.A. does not face the basic economic problem.Correct AnswerFalseYour AnswerFalse

Multiple Choice Single AnswerQuestionIn equilibrium analysis of a firm, it is assumed that every individual proprietor exhibits rationaleconomicCorrect Answerbehavior








Your Answerbehavior

Match The FollowingQuestion

Correct AnswerYour AnswerManagerial EconomicsPrescriptive in natureThe theory of distributionResourcesAlternative usesAlternative usesDivision of society‟s output of goods and services The theory of distributionPrescriptive in nature

Motor carsTangible goodsTangible goodsWantsInsatiableInsatiable

True/FalseQuestionMarket price fluctuates very oftenCorrect Answer

TrueYour AnswerFalse

Multiple Choice Single AnswerQuestionThe firm is the unit that makes the decisions regarding employment of and the output of commodities areCorrect Answerfactors of productionYour Answerfactors of production

Multiple Choice Single AnswerQuestionThe principle of exclusion cannot be applied to the goods which areCorrect Answerindivisible



Your Answerinvisible


In the cost – benefit analysis, the firm step involved is that the investor has to choose a fewproject alternatives promising a rate of return which isCorrect AnswerhighYour Answerhigh

Multiple Choice Single AnswerQuestionMarket system of economy is characterized by consumer‟s Correct Answer

sovereigntyYour Answerdemand

Multiple Choice Single AnswerQuestionIn case of a joint stock company, the liability of share holders isCorrect AnswerlimitedYour Answerlimited

True/FalseQuestionThe divisible goods, whose benefits can be priced, are called pure public goodsCorrect AnswerFalseYour AnswerTrue

True/FalseQuestionIn case of a proprietary firm the liability of the proprietor is limitedCorrect AnswerFalseYour AnswerFalse

True/FalseQuestion



During the phase of depression, the level of national income and expenditure rises rapidlyCorrect AnswerFalseYour AnswerFalse

Multiple Choice Single AnswerQuestionAccording J.B.Clark, profit is the reward paid forCorrect AnswerdynamismYour Answerrisk bearing


Gross profit is the excess of total revenue of a firm over totalCorrect AnswerexpenditureYour Answerexpenditure

Multiple Choice Single AnswerQuestionIn general, the demand for necessaries is relativelyCorrect Answerinelastic

Your Answerelastic

True/FalseQuestionDemand for food grains is inelastic but the demand for wheat is elastic.Correct AnswerTrueYour AnswerFalse

Match The FollowingQuestionCorrect AnswerYour AnswerExcess supply can be defined asQuantity supplied minus quantity demandedQuantity supplied minus quantity demandedIf demand remain unchanged on increase in supply will result in



A rise in equilibrium quantityThe supply is perfectly elasticMarket Price is a situation whichThe supply is perfectly elasticA rise in equilibrium quantity

The responsiveness of demand to change in price is measuredElasticity of demandIn the same proportionUnit income elasticity implies that asincome rises demand for a commodity risesIn the same proportionElasticity of demand

Select The Blank QuestionGreater scope for the ________ sector may mean incremental ________ , which connotes theexpansion of public sector undertakings, can be left to some private companies

Correct AnswerprivateYour AnswerinvestmentCorrect AnswerdisinvestmentsYour Answergrowth


Goods produced on small scale of supply isCorrect AnswerinelasticYour Answerzero elastic

True/FalseQuestionThe sum of total fixed costs and total variable costs is the total cost.Correct AnswerTrueYour AnswerTrue

True/FalseQuestionContraction of supply is traced by the downward movement on the supply curve.Correct AnswerTrue



Your AnswerTrue

True/FalseQuestion

The laws of returns to scale explain the behavior of output in response to changes in scale.Correct AnswerTrueYour AnswerTrue

True/FalseQuestionIn the stage I of the law of diminishing returns, the marginal product goes on increasingCorrect AnswerTrue

Your AnswerFalse

Multiple Choice Multiple AnswerQuestionFeatures of monopolistic CompetitionCorrect AnswerFairly Large number of firms , Product differentiation , Selling costs are existedYour AnswerFairly Large number of firms , Product differentiation , Selling costs are existed

Select The Blank QuestionWhere ________ is charging a ________ in the home market and a lower price in theinternational market, it is called DumpingCorrect AnswermonopolistYour Answera firmCorrect Answerhigher priceYour Answerhigher price

Select The Blank QuestionThe number of sellers operating under this type of competition is ________ under oligopoly, butless than under ________Correct Answerlarger than



Your AnswercomplementaryCorrect Answerperfect ompetitionYour Answer

perfect ompetition

Multiple Choice Multiple AnswerQuestionMarginal Propensity to consumeCorrect AnswerIt is defined as the ratio of the change in consumption to the change in income , It is rate of change in the average propensity to consume as income changes , It is derived by the formulampc= change in C/change in YYour AnswerIt is defined as the ratio of the change in consumption to the change in income , It is derived by

the formula mpc= change in C/change in Y , It is derived by dividing the change in income bychange in the consumption expenditure

Multiple Choice Multiple AnswerQuestionInvestmentCorrect AnswerIt adds to capital equipments , It leads to increase in level of income , It includes new plant andequipmentYour AnswerIt adds to capital equipments , It leads to increase in level of income , It includes new plant and

equipmentMultiple Choice Multiple AnswerQuestionFeatures of stage of expansion in business cycle areCorrect AnswerRise in national output , Rise in consumer and capital expenditure , Bank advances grow rapidlyYour AnswerRise in national output , Rise in consumer and capital expenditure , Bank advances grow rapidly

Multiple Choice Multiple AnswerQuestionCharacteristics of DepressionCorrect AnswerDecrease in economic activities , The growth rate becomes negative , The level of nationalincome declines rapidlyYour AnswerDecrease in economic activities , The growth rate becomes negative



Multiple Choice Multiple AnswerQuestionRecession includesCorrect AnswerThe demand is halted , Increase in production of goods , Inventories piling up in stocks

Your AnswerThe demand is halted , Inventories piling up in stocks


Select The Blank QuestionThe rate of interest, according to ________ , depends upon two factors: (i) ________ and (ii) thequantity of moneyCorrect AnswerKeynesYour AnswerKeynesCorrect Answerthe liquidity preference functionYour Answer

the liquidity preference functionSelect The Blank QuestionIn the words of ________ , “inflation occurs when the ________ of prices and cost is rising”. Correct AnswerProf. SamuelsonYour AnswerProf. SamuelsonCorrect Answergeneral levelYour Answergeneral level

Multiple Choice Multiple AnswerQuestionForms of Public EnterprisesCorrect AnswerPublic Corporations , Departmental management , Company Management or management by



boardsYour AnswerDepartmental management , Public Corporations


QuestionSpecific organizational goals of Firms are:Correct AnswerMaximisation of profit , Reasonable Profit Target , Sales revenue MaximizationYour AnswerMaximisation of profit , Reasonable Profit Target , Sales revenue Maximization

Multiple Choice Multiple AnswerQuestionIndividual Demand Schedule:Correct Answer

Is in tabular form , It shows the prices of goods , It shows the quantities of a commoditypurchasedYour AnswerIs in tabular form , It shows the prices of goods , It shows the quantities of a commoditypurchased

Multiple Choice Multiple AnswerQuestionThe production function can be explained by:Correct AnswerLaw of variable proportions , Laws of returns to scale , Optimum combinations of inputs

Your AnswerLaw of variable proportions , Laws of returns to scale , Optimum combinations of inputs

Multiple Choice Multiple AnswerQuestionImplicit costs are:Correct AnswerCost on self owned resources , Costs of salary of the proprietor , Interest on the entrepreneur‟sown investmentYour AnswerCost on self owned resources , Interest on the entrepreneur‟s own investment

Select The Blank QuestionManagerial ________s generally refers to the integration of economic theory with ________practice.Correct AnswereconomicYour Answer



economicCorrect AnswerbusinessYour Answerbusiness

Select The Blank QuestionIn a competitive industry, there is a large number of firms so that the action of ________ firmhas ________ on the price and output of the whole industry.Correct Answera singleYour Answera singleCorrect Answerno effect

Your Answerno effect

Select The Blank QuestionAs per the International Labour Organisation (ILO), _ ________ is a ________ association of individuals with limited income on the basis of equal rights and responsibilities for achievingcertaCorrect AnswerCo-operationYour Answer

Co-operationCorrect AnswervoluntaryYour Answervoluntary

Select The Blank QuestionThe word ________ has different meanings to businessmen, ________ , tax collectors, workersand economists and it is often used in a loose sense that buries its real significanceCorrect AnswerProfitYour AnswerProfitCorrect AnsweraccountantsYour Answeraccountants



Select The Blank QuestionThe demand curve is ________ representation of a demand schedule, demand curve slopes________ ward from left to right.Correct Answer

graphicalYour AnswergraphicalCorrect AnswerdownYour Answerdown

Select The Blank QuestionThe ________ that is ________ is the opportunity cost of the commodity produced.

Correct AnswersacrificedYour AnswercommodityCorrect AnswercommodityYour Answersacrificed




Multiple Choice Single AnswerQuestion Pure public goods are subject to the law of decreasing average cost, because of theCorrect Answer economies of scaleYour Answer economies of scale

Multiple Choice Single AnswerQuestion In the cost – benefit analysis, after formulating various alternative project capacity,

each of them has to be examined in terms of itsCorrect Answer feasibilityYour Answer feasibility

True/FalseQuestion Bargaining is one of the remedies of corrective action.Correct Answer FalseYour Answer True









Defence service Indivisible Indivisible

Economic effects of public goods are Spill over effect Spill over effect

Selection or implementation Step of cost benefit analysis Step of cost benefit analysis

Production possibility frontier Maximization of output Maximization of output

Multiple Choice Multiple AnswerQuestion The advantage of cost-benefit analysis areCorrect Answer Maximization of social welfare , Objective measurement of the trade-off ,Maximization of difference between total benefits & total costsYour Answer Maximization of social welfare , Objective measurement of the trade-off ,

Maximization of difference between total benefits & total costs

Multiple Choice Multiple AnswerQuestion The term externalities may also be referred as:Correct Answer Spill-over effects , Neighborhood effects , Third party effectsYour Answer Spill-over effects , Neighborhood effects , Third party effects

Select The Blank Question Modern economists treat social cost and benefits as ________ of private investmentand production decisions.Correct Answer externalities

Your Answer disadvantages

Select The Blank Question Economists like A.C.Harberger have shown that the cost benefit analysis can beapplied to ________ analysis.Correct Answer general equilibriumYour Answer general equilibrium

Select The Blank Question In the context of formulating an investment project, ________ feasibility means theavailability of supervisors for implementing and running the project smoothly and professionally.

Correct Answer managementYour Answer management

Select The Blank Question Prof. Sam Nelson calls risks from unsafe factories or nuclear power plants as ________economies.Correct Answer negativeYour Answer hazardous



Multiple Choice Single AnswerQuestion According to Lionel Robbins, “Economics is a science which studies Correct Answer human behaviorYour Answer social behavior

Multiple Choice Single AnswerQuestion Question related to the efficient production and allocation belong to the branch of economic theory calledCorrect Answer Welfare EconomicsYour Answer Business Economics

Multiple Choice Multiple AnswerQuestion Managerial economics deals withCorrect Answer Integration of economic theory with business practice , Using logic of economics, mathematics & statistics , The use of economic modes of thought to analyze businesssolution

Your Answer Integration of economic theory with business practice , Using logic of economics,mathematics & statistics , The use of economic modes of thought to analyze business solution

Multiple Choice Single AnswerQuestion The public sector is owned & controlled byCorrect Answer state enterprisesYour Answer state enterprises

Select The Blank Question Reasonable profit target as an alternative to the objective of profit maximization wassuggested by ________.

Correct Answer Joel DeanYour Answer Joel Dean

Select The Blank Question “Homeostatic Approach” as an alternative objective of firms was suggested by________.Correct Answer Prof. Kenneth BouldingYour Answer Prof. Kenneth Boulding

Select The Blank Question The form of organization which is best for self employment is ________.Correct Answer Sole traderYour Answer Sole trader

True/FalseQuestion Accounting profit takes in to account opportunity cost.Correct Answer FalseYour Answer False



Multiple Choice Single AnswerQuestion Complementary goods are demandedCorrect Answer jointlyYour Answer jointly

Multiple Choice Single AnswerQuestion If the substitutes are relatively costly then the demand for the commodity in questionwill beCorrect Answer moreYour Answer same

True/FalseQuestion There are no real exceptions to the law of demandCorrect Answer FalseYour Answer False

True/FalseQuestion Demand curve slopes downwards from left to right.Correct Answer TrueYour Answer True

Select The Blank Question An upward sloping demand curve is called ________Correct Answer exceptional demand curveYour Answer exceptional demand curve

Select The Blank

Question Goods which are paradoxical to the law of demand are ________Correct Answer Giffen goods, ,Your Answer Giffen goods, ,


Normally the isoquant slopes upward from right to left. downward from right to left

Any straight line supply curve which cuts y axis will have zero elasticity of supply. perfectlyelastic

The market period supply curve for perishable commodities is perfectly inelastic. perfectlyinelastic.

A rightwards shift in supply schedule indicates an increase in supply. an increase in supply.

Multiple Choice Multiple AnswerQuestion Explicit costs are



Correct Answer Out of pocket costs , These are firms accounting expenses , Expenditure costsYour Answer Out of pocket costs , These are firms accounting expenses , Expenditure costs

Select The Blank Question Output rises in a lesser proportion to that of the increase in input, under the case of

________.Correct Answer decreasing returns to scaleYour Answer decreasing returns to scale


Multiple Choice Single AnswerQuestion Jevons‟ , the economists who defined the term „market‟ different from that of the

traditional sense is anCorrect Answer English economistsYour Answer English economists

Multiple Choice Single AnswerQuestion Economists have pointed out that the real world is full of Correct Answer Imperfect competitionYour Answer Imperfect competition

True/FalseQuestion A firm under perfect competition is a price maker.

Correct Answer FalseYour Answer False

True/FalseQuestion Under perfect competition single seller can influence the price.Correct Answer FalseYour Answer False

Multiple Choice Multiple AnswerQuestion Types of imperfect competition areCorrect Answer Monopoly , Duopoly , Oligopoly

Your Answer Monopoly , Duopoly , OligopolyMultiple Choice Multiple AnswerQuestion Features of Pure Competition areCorrect Answer Large number of buyers and sellers , Homogeneous products , Free entry andfree exit of firmsYour Answer Large number of buyers and sellers , Homogeneous products , Free entry and freeexit of firms



Multiple Choice Multiple AnswerQuestion Equilibrium is the stage of Correct Answer maximum satisfaction , balance , stationaryYour Answer maximum satisfaction , balance

Multiple Choice Single AnswerQuestion Inflation is a phenomena in which pricesCorrect Answer riseYour Answer rise

Multiple Choice Single AnswerQuestion True inflation starts only after reaching the level of fullCorrect Answer EmploymentYour Answer Employment

True/False

Question During inflation, the pensioners whose income is permanently fixed, are substantiallybenefited.Correct Answer FalseYour Answer False

True/FalseQuestion Saving is a private virtueCorrect Answer TrueYour Answer True


Question According to Keynes, Aggregate supply function refers toCorrect Answer the minimum price of revenue which the entrepreneurs must get , Associatedwith different levels of employment , Explains that the level of out put varies with the level of employmentYour Answer the minimum price of revenue which the entrepreneurs must get , Associated withdifferent levels of employment , Explains that the level of out put varies with the level of employment

Multiple Choice Multiple AnswerQuestion Marginal Propensity to consume is characterized as followsCorrect Answer It is defined as the ratio of the change in consumption to the change in income ,It is rate of change in the average propensity to consume as income changes , It is derived by theformula mpc= change in c/change in yYour Answer It is rate of change in the average propensity to consume as income changes , It isderived by the formula mpc= change in c/change in y , It is derived by dividing the change inincome by change in the consumption expenditure

Multiple Choice Single AnswerQuestion During the period of depression various factors of production are



Correct Answer exhaustedYour Answer unutilized

True/FalseQuestion In general SBI uses its monetary policy to achieve a judicious balance between the

growth of production and control of the general price level.Correct Answer FalseYour Answer False

True/FalseQuestion Public enterprises have shown a very high rate of return of the capital investedCorrect Answer FalseYour Answer False

Multiple Choice Multiple AnswerQuestion The meaning of monetary policy is

Correct Answer It is programmed of the central bank , It controls the total supply of money , Thebasic objective is to achieve economic stabilityYour Answer It is programmed of the central bank , It controls the total supply of money , Thebasic objective is to achieve economic stability

Multiple Choice Multiple AnswerQuestion Main aims of the New Industrial Policy (1991) areCorrect Answer To unshackle the indian industrial economy from the cobwebs of unnecessarybureaucratic control , To introduce liberalization with a view to integrate the indian economywith the world economy , To remove restrictions on direct foreign investment as also to free thedomestic entrepreneur from the restriction of MRTP act

Your Answer To unshackle the indian industrial economy from the cobwebs of unnecessarybureaucratic control , To introduce liberalization with a view to integrate the indian economywith the world economy , To remove restrictions on direct foreign investment as also to free thedomestic entrepreneur from the restriction of MRTP act

Multiple Choice Multiple AnswerQuestion Objectives of economic policy areCorrect Answer To increase the efficiency and international competitiveness of industrialproduction , To improve the performance and rationalize the scope of the public sector , Toreform and modernize the financial sectorYour Answer To increase the efficiency and international competitiveness of industrialproduction , To improve the performance and rationalize the scope of the public sector , Toreform and modernize the financial sector











True/FalseQuestionA supply schedule is a graphical presentation of supply patterns.Correct AnswerFalse

Your AnswerTrue

True/FalseQuestionThe subject matter of macro – economics includes the theory of income and employment at anindividual level.Correct AnswerFalseYour AnswerFalse

Select The Blank QuestionWhen demand for the product increases in the same proportion in which income increases,Income elasticity of demand will be equal to________Correct AnswerunityYour Answerunity


QuestionFeatures of stage of expansion in business cycle areCorrect AnswerRise in national output , Rise in consumer and capital expenditure , Bank advances grow rapidlyYour AnswerRise in national output , Rise in consumer and capital expenditure , Bank advances grow rapidly

Multiple Choice Multiple AnswerQuestionExplicit costs areCorrect AnswerOut of pocket costs , These are firms accounting expenses , Expenditure costsYour AnswerOut of pocket costs , These are firms accounting expenses , Expenditure costs

Multiple Choice Single AnswerQuestionDemand for products like tea, betel, tobacoo, sigaratte is a matter of Correct Answer



habitYour Answerhabit


QuestionIf the substitutes are relatively cheaper then the demand for the commodity in question will beCorrect AnswerlessYour Answerless

Multiple Choice Single AnswerQuestionAn assembly of several machines, linked together either physically or by processes, capable of producing a given quantity of a product per day is

Correct AnswerplantYour Answerplant

Multiple Choice Single AnswerQuestionThe Risk Taking Theory was developed by Hawley, who was anCorrect AnswerAmerican EconomistYour Answer

American EconomistSelect The Blank QuestionThe cost which enter the accounts book of the firm are referred as ________.Correct AnswerAccounting costYour AnswerAccounting cost

Select The Blank QuestionThe persons who own the ________hip concern are called Partners.Correct AnswerPartnersYour AnswerPartners



Select The Blank QuestionPerfectly elastic demand curve is ________Correct Answerhorizontal

Your Answerhorizontal

Select The Blank QuestionWhile discussing the product divisibility of public and private goods, the principle of ________may be applied in case of only those people who do not agree to pay or who cannot pay themarket priceCorrect AnswerexclusionYour Answer

exclusionMultiple Choice Multiple AnswerQuestionFeatures of the firm areCorrect AnswerIt is a business unit organized under one ownership , It is a sole proprietorship , It is a partnershipor joint stock companyYour AnswerIt is a business unit organized under one ownership , It is a sole proprietorship , It is a partnershipor joint stock company

Multiple Choice Multiple AnswerQuestionThe causes of inflation areCorrect AnswerIncrease in public expenditure , Increase in private expenditure , Increase in foreign demandYour AnswerIncrease in public expenditure , Increase in private expenditure , Increase in foreign demand

True/FalseQuestionInflation is a great opportunity for merchants to earn more profit.Correct AnswerTrueYour AnswerTrue




Correct AnswerYour AnswerHuman wantsunlimitedunlimited

General Theory of Employment, Interest and MoneyJ. M. KeynesJ. M. KeynesManagerial economicsDecision making and forward planningDecision making and forward planningResourcesscarcescarceCommoditiesgoods and services

goods and servicesMultiple Choice Multiple AnswerQuestionThe advantage of cost-benefit analysis areCorrect AnswerMaximization of social welfare , Objective measurement of the trade-off , Maximization of difference between total benefits & total costsYour AnswerMaximization of social welfare , Objective measurement of the trade-off , Maximization of difference between total benefits & total costs

Select The Blank QuestionSole Proprietorship which is also called sole ________Correct AnswertradershipYour Answertradership

True/FalseQuestionA plant is an economic unit which takes various decisions related to production and distribution.Correct AnswerFalseYour AnswerFalse




Features of an Industry areCorrect AnswerAll firms dealing in the same line of business , The ownership and management of each firm isdifferent , Is a group of firmsYour Answer

All firms dealing in the same line of business , The ownership and management of each firm isdifferent , Is a group of firms

Multiple Choice Single AnswerQuestionManagerial economics generally refers to the integration of economic theory with businessCorrect AnswerPracticeYour AnswerPractice

True/FalseQuestionDuring recession, on account of decline in investment by producers, there is decline in incomeand consumption.Correct AnswerTrueYour AnswerTrue


The fiscal policy includesCorrect AnswerMonitoring of public expenditure , Formation of taxation policy , It is an instrument foreconomic stabilizationYour AnswerFormation of taxation policy , It is an instrument for economic stabilization , Monitoring of public expenditure

Multiple Choice Single AnswerQuestionForecasts made either through experience or through methodigistic areCorrect AnswerstatisticalYour Answerstatistical

Multiple Choice Single AnswerQuestionManagerial economics is also understood to refer to



Correct Answerapplied economicsYour Answerapplied economics

Select The Blank QuestionThe externality which causes an economic gain or an economic loss to other economic units isalso referred to as ________ externality.Correct AnswerPecuniaryYour AnswerSocial


According to Prof. F.H. Knight, profit is a reward forCorrect Answeruncertainty bearingYour Answeruncertainty bearing

Multiple Choice Single AnswerQuestionThe principle of full employment equilibrium was stated byCorrect AnswerSay‟s Law of Market

Your AnswerLaw of Demand

Multiple Choice Multiple AnswerQuestionPhases of business cycleCorrect AnswerExpansion , Peak , RecessionYour AnswerExpansion , Peak , Recession , Trough

True/FalseQuestionIn case of a Joint Stock Company the liability of the share holders is unlimited.Correct AnswerFalseYour AnswerFalse



Multiple Choice Single AnswerQuestionGoods which are completely divisible and to them the principle of exclusion applies in fullmeasure, are calledCorrect Answer

Pure public goodsYour AnswerPrivate goods

Multiple Choice Multiple AnswerQuestionAssumptions underlying the law of Supply areCorrect AnswerThe cost of production is unchanged , No change in technique of production , Governmentpolicies are unchangedYour Answer

The cost of production is unchanged , No change in technique of production , Governmentpolicies are unchanged

Multiple Choice Multiple AnswerQuestionThe payments made out of the Gross Profit areCorrect AnswerRemuneration to factors of production , Depreciation , Maintenance ChargesYour AnswerRemuneration to factors of production , Depreciation , Maintenance Charges

Select The Blank QuestionThe indivisible goods to which the principle exclusion does not apply are called ________goods.Correct Answerpure publicYour Answerpure public

True/FalseQuestionMicro-economics is primarily concerned with the problem of what, how and for whom toproduce?Correct AnswerFalseYour AnswerTrue



Multiple Choice Single AnswerQuestionGross profit is the excess of total revenue of a firm over totalCorrect Answerexpenditure

Your Answerexpenditure

True/FalseQuestionDuring period of depression various factors of production lie unutilized.Correct AnswerTrueYour AnswerTrue

Multiple Choice Multiple AnswerQuestionCo-operative organizations isCorrect Answervoluntary organization , managed by democratic principle , organization, which performs itsbusiness within the membersYour Answervoluntary organization , managed by democratic principle , organization, which performs itsbusiness within the members , non profit motive organization


QuestionMacro economics is the study of theCorrect Answeraggregate behavior of economyYour Answeraggregate behavior of economy

True/FalseQuestionTo solve the unemployment problem, the level of effective demand must decrease.Correct AnswerFalseYour AnswerFalse

Multiple Choice Single AnswerQuestionThe public sector is owned & controlled byCorrect Answer



state enterprisesYour Answerstate enterprises

Select The Blank

QuestionDemand for safety pins is ________Correct AnswerinelasticYour Answerrelatively inelastic

Multiple Choice Single AnswerQuestionUnder perfect competition, generally demand and supply act and react upon each other anddetermine the price

Correct AnswerequilibriumYour Answerequilibrium

True/FalseQuestionDuring the period of recession there is increase in incomes of wage and interest earners.Correct AnswerFalseYour Answer

FalseSelect The Blank QuestionIn a market economy ________ is the best judge of personal interest.Correct AnswerindividualYour Answerfirm




True/FalseQuestionA monopolist in a price maker.









Multiple Choice Single AnswerQuestionThe city of Faridabad has specialized in the manufacture of Correct AnswerbanglesYour Answerbangles

Multiple Choice Multiple AnswerQuestionDemand is determined by

Correct AnswerPrice of the product , Relative prices of other goods , Tastes and habitsYour AnswerPrice of the product , Relative prices of other goods , Tastes and habits

Multiple Choice Multiple AnswerQuestionBaumol has pointed out three main contributions of economic theory. They areCorrect AnswerEconomic theory offers clarity to various concepts used in the business anlayses , Economictheory contributes in building anlyatical model to rocognize managerial problems , Economic

theory contributes to ,‟a set of analytical methods‟ which enhance the analytical capabilities of business analyasisYour AnswerEconomic theory offers clarity to various concepts used in the business anlayses , Economictheory contributes in building anlyatical model to rocognize managerial problems , Economictheory contributes to ,‟a set of analytical methods‟ which enhance the analytical capabilities of business analyasis

True/FalseQuestionIn case of indivisible goods, which are not priced, the decisions regarding their demandpreferences are taken through price mechanism.Correct AnswerFalseYour AnswerTrue

True/FalseQuestion



A shift in the demand curve to the left shows increase in demand.Correct AnswerFalseYour AnswerTrue



With decline in price of a commodity, total expenditure spent on the commodity is less thanbefore, then elasticity of demand for the commodity isCorrect Answer< 1Your Answer< 1

Match The FollowingQuestionCorrect AnswerYour Answer

N.G.O.SVoluntary social work Voluntary social work Sole proprietorshipUnlimited liabilityUnlimited liabilityPreference sharesFixed rate of dividendFixed rate of dividendPublic enterprisesState controlState control

True/FalseQuestionPure private goods are completely divisible and to them the principle of exclusion applies in fullmeasure.Correct AnswerTrue



Your AnswerTrue


The act of using goods and services to satisfy wants is calledCorrect AnswerconsumptionYour Answerconsumption

True/FalseQuestionExternal economies are the advantages of large scale production enjoyed exclusively anindividual firm alone.Correct Answer


Multiple Choice Single AnswerQuestionMarket mechanism is characterized byCorrect AnswerinstabilityYour Answerstability

Multiple Choice Multiple AnswerQuestionFeatures of Pure Competition areCorrect AnswerLarge number of buyers and sellers , Homogeneous products , Free entry and free exit of firmsYour AnswerLarge number of buyers and sellers , Homogeneous products , Free entry and free exit of firms

Multiple Choice Single AnswerQuestionThe things that are produced by factors of production are calledCorrect AnswercommoditiesYour Answerfree goods

True/FalseQuestion



Generally, the larger the income of a consumer, his demand for overall commodities tends to berelatively elastic.Correct AnswerFalseYour Answer

False

Multiple Choice Multiple AnswerQuestionThe production function studiesCorrect AnswerInput and out put relation , Factors of production and final production , Technology used inproductionYour AnswerInput and out put relation , Factors of production and final production , Demand for production

Select The Blank QuestionThe externality which causes an economic gain or an economic loss to other economic units isalso referred to as ________ externality.Correct AnswerPecuniaryYour AnswerSocial


The index numbers which are compiled to measure the changes in retail prices of variouscommodities refers to ________Correct AnswerRetail prices indexYour AnswerRetail prices index

Select The Blank QuestionIn the context of formulating an investment project, ________ feasibility means the availabilityof supervisors for implementing and running the project smoothly and professionally.Correct AnswermanagementYour Answermanagement

Select The Blank QuestionThe minimum number of directors which private limited should have is ________.



Correct Answer2Your Answer2

Select The Blank QuestionIn a market economy ________ is the best judge of personal interest.Correct AnswerindividualYour Answerindividual

Multiple Choice Single AnswerQuestionThe concept of just distribution of national product is a

Correct AnswernormativeYour Answerneutral

True/FalseQuestionSupply management is related to the volume ofsupply & its distribution system.Correct AnswerTrueYour Answer

TrueMultiple Choice Single AnswerQuestionThe type economic problem isCorrect AnsweruniversalYour Answeruniversal

Multiple Choice Single AnswerQuestionUnder monopoly entry of new firms isCorrect AnswerprohibitedYour Answerprohibited



Multiple Choice Multiple AnswerQuestionSpecific organizational goals of Firms areCorrect Answermaximization of profit , reasonable profit target , sales revenue maximization

Your Answermaximization of profit , sales revenue maximization , to cover risk and uncertainty

Multiple Choice Multiple AnswerQuestionGovernment intervention is needed in free market mechanism toCorrect AnswerTo provide employment to all who willing to work at prevailing wage rate , Factors of production are optimally allocated between the various industries , All will get sufficient incometo meet their basic needsYour Answer

To provide employment to all who willing to work at prevailing wage rate , Factors of production are optimally allocated between the various industries , Control the marketmechanism by charging license fees, commissions, etc

Multiple Choice Single AnswerQuestionThe firm is a center, where all the decisions are taken aboutCorrect AnswerproductionYour Answerproduction

Multiple Choice Single AnswerQuestionUnder the imperfect market, the market in which few firms exists is called asCorrect AnswerOligopolyYour AnswerOligopoly

True/FalseQuestionThere are no real exceptions to the law of demandCorrect AnswerFalseYour AnswerFalse




Every nation‟s resources which are u sed to produce the quantities of goods and services thatwould be required to satisfy all its citizen‟s wants are Correct AnswerinsufficientYour Answer

insufficient

True/FalseQuestionThe prosperity phase is characterized by rise in the level of employment.Correct AnswerTrueYour AnswerTrue


QuestionThe characteristics of a sole proprietorship firm isCorrect AnswerUnlimited Capital , Ownership by a single person , Easy to formYour AnswerOwnership by a single person , Easy to form

Select The Blank QuestionSole Proprietorship which is also called sole ________Correct Answer

tradershipYour Answertradership

Multiple Choice Single AnswerQuestionThe method of inventory valuation in which , the cost of production is calculated on theassumption that the material which was last to enter the inventory of the company was used firstisCorrect AnswerLIFOYour AnswerLIFO

Multiple Choice Single AnswerQuestionIn economics, demand means desire backed by adequateCorrect Answerpurchasing power



Your Answerpurchasing power


Managerial economics generally refers to the integration of economic theory with businessCorrect AnswerPracticeYour AnswerPractice

Multiple Choice Single AnswerQuestionA group of firms dealing in the same line of business are called asCorrect AnswerIndustry

Your AnswerIndustry

Multiple Choice Single AnswerQuestionManagerial economics is also understood to refer toCorrect Answerapplied economicsYour Answerapplied economics

Match The FollowingQuestionCorrect AnswerYour AnswerNon-price competitionadvertisement.advertisement.Prestige pricehigh price on account of prestige considerations.high price on account of prestige considerations.Administered pricespublic sector undertaking.state government.Pricing in cooperative societiesstate government.public sector undertaking.




The demand curve (A.R.) of a firm under perfect competition isCorrect Answerperfectly elasticYour Answerinelastic

Multiple Choice Multiple AnswerQuestionThe advantage of cost-benefit analysis areCorrect AnswerMaximization of social welfare , Objective measurement of the trade-off , Maximization of difference between total benefits & total costsYour AnswerMaximization of social welfare , Maximization of difference between total benefits & total costs, Applicable only in partial equilibrium framework.

Select The Blank QuestionBy using cost-benefit analysis we can show the measures necessary for attaining maximum________ and optimal policy aiming at this goal.Correct Answernet wealthYour Answernet domestic product


The causes of inflation areCorrect AnswerIncrease in public expenditure , Increase in private expenditure , Increase in foreign demandYour AnswerIncrease in public expenditure , Increase in foreign demand , Increase in taxation

Select The Blank QuestionThe partnership between private sector & government is called ________Correct AnswerJoint sector enterpriseYour AnswerJoint sector enterprise

Multiple Choice Multiple AnswerQuestionFeatures of short run period areCorrect AnswerSupply of goods can be adjusted to the demand to some extent , Supply and demand determine



the price , Some factors can be changedYour AnswerSupply of goods can be adjusted to the demand to some extent , Supply and demand determine




Multiple Choice Single AnswerQuestionManagerial economics generally refers to the integration of economic theory with businessCorrect AnswerPracticeYour AnswerPractice

Multiple Choice Single AnswerQuestionEvery nation‟s resources which are used to produce the quantities of goods and services thatwould be required to satisfy all its citizen‟s wants are Correct AnswerinsufficientYour Answersufficient


True/FalseQuestionInflation reduces the purchasing power of money and savings.Correct AnswerTrueYour AnswerFalse








Multiple Choice Single AnswerQuestionThe supply curve during market period is perfectlyCorrect Answerinelastic

Your Answerinelastic


Match The FollowingQuestionCorrect AnswerYour AnswerManagerial economicsDecision making and forward planningDecision making and forward planningResourcesscarcegoods and services

Commoditiesgoods and servicesscarceHuman wantsunlimitedunlimitedGeneral Theory of Employment, Interest and MoneyJ. M. KeynesJ. M. Keynes

True/FalseQuestionThe price policy under monopolistic competition is dependent on the prices charged by otherrival firmsCorrect AnswerTrueYour AnswerFalse



Multiple Choice Single AnswerQuestionAll firms producing the same or similar product together makeCorrect Answeran industry

Your Answeran industry

Multiple Choice Single AnswerQuestionJoint Stock Company succession isCorrect AnswerperpetualYour Answerperpetual

True/FalseQuestionPrivate profit motive is an essential feature of CapitalismCorrect AnswerTrueYour AnswerTrue

True/FalseQuestion„Free riders‟ is a term associated with the people w ho would like to have benefit of a good

without sharing the cost of its supplyCorrect AnswerTrueYour AnswerFalse

Multiple Choice Single AnswerQuestionMacro – economics provides an exploration to the functioning of an economy inCorrect AnswergeneralYour Answergeneral

True/FalseQuestionInflation is a great opportunity for merchants to benefit more.Correct AnswerTrue



Your AnswerTrue

True/FalseQuestion

The various phases of business cycles are shown by the line of cycle which moves up and downthe steady growth lineCorrect AnswerTrueYour AnswerTrue

True/FalseQuestionIn the measurement of profit, the differences in the concept of profit arise out of the differencesin cost concepts

Correct AnswerTrueYour AnswerFalse

Multiple Choice Single AnswerQuestionIn economics demand means desire backed by adequateCorrect Answerpurchasing powerYour Answer

ability to payMultiple Choice Single AnswerQuestionThe law of diminishing returns is applicable to agriculture provided the state of technology isgiven andCorrect AnswerconstantYour Answerconstant

Multiple Choice Single AnswerQuestionUnder the monetary measures to control inflation, the R. B. I relies heavily on selective creditcontrols on bank loans against food grains, sugar, oils, oilseeds, cotton etc so as to discourageCorrect AnswerSpeculative hoardingYour AnswerSpeculative hoarding



Multiple Choice Single AnswerQuestionSlope of supply curve isCorrect Answerpositive

Your Answerpositive

Multiple Choice Single AnswerQuestionCosts which increase because of the expansion of a firm are called costsCorrect AnswerincrementalYour Answerincremental

True/FalseQuestionThe opportunity cost of a product is the opportunity gained of being able to produce some otherproduct.Correct AnswerFalseYour AnswerFalse

True/FalseQuestion

The supply curve in case of unitary elastic supply is rectangular hyperbola.Correct AnswerFalseYour AnswerFalse

Multiple Choice Multiple AnswerQuestionAn IndustryCorrect AnswerIs a group of firms , All firms dealing in the same line of business , The ownership andmanagement of each firm is differentYour AnswerIs a group of firms , All firms dealing in the same line of business , The ownership andmanagement of each firm is different

Select The Blank QuestionUnder monopoly, there is ________ seller who controls the entire ________ in the market



Correct Answeronly oneYour Answeronly oneCorrect Answer

supplyYour Answersupply

Select The Blank QuestionUnder monopsony, there are ________ sellers but ________ buyerCorrect AnswermanyYour Answermany

Correct Answeronly oneYour Answeronly one

Match The FollowingQuestionCorrect AnswerYour AnswerMarginal utilityAddition to total utility

Addition to total utilityTotal utility increases marginalPosative and decliningMarginal utility is zeroAt the saturation point for a commodity x the Mux isZeroDemand curve of a commodityMarginal utilities areDemand curve of a commodityPosative and decliningTotal utility isMarginal utility is zeroZero

Select The Blank QuestionBy using cost-benefit analysis we can show the ________ necessary for attaining maximum________ and optimal policy aiming at this goalCorrect Answer



measuresYour AnswerGross Domestic ProductCorrect Answernet wealth

Your Answergross wealth

Multiple Choice Multiple AnswerQuestionAverage propensity to consumeCorrect AnswerIt is defined as the ratio of consumption expenditure to any particular level of income , It isfound by dividing consumption expenditure by income , It is expressed as the percentage of income consumedYour Answer

It is derived by dividing income by consumption expenditureMultiple Choice Multiple AnswerQuestionInflation meansCorrect AnswerIt is a phenomenon of rising prices , It is a general and dynamic phenomenon , It includes anexcess of demandYour AnswerIt is a phenomenon of rising prices

Select The Blank QuestionAggregate supply function refers to a ________ of the various minimum amounts of proceeds or________ , which must be expected to be received by the entrepreneur class from the sale of output resultCorrect AnswerscheduleYour AnswerdemandCorrect AnswerrevenuesYour Answerrevenues

Select The Blank QuestionIn the ________ terminology, the ________ demand function refers to the schedule of maximumsales proceeds, which the entrepreneurial community actually does expect to be received fromthe sale of



Correct AnswerKeynesianYour AnswerKeynesianCorrect Answer

aggregateYour Answeraggregate

Multiple Choice Multiple AnswerQuestionThe fiscal policy includesCorrect AnswerFormation of taxation policy , It is an instrument for economic stabilization , Monitoring of public expenditureYour Answer

Formation of taxation policy , It is an instrument for economic stabilization , Monitoring of public expenditure

Multiple Choice Multiple AnswerQuestionThe meaning of monetary policyCorrect AnswerIt is programme of the central bank , It controls the total supply of money , The basic objective isto achieve economic stabilityYour AnswerIt is programme of the central bank , It controls the total supply of money , The basic objective is

to achieve economic stabilityMultiple Choice Multiple AnswerQuestionCauses for rise in prices in IndiaCorrect AnswerMounting government expenditure , Deficit financing and increase in money supply , Role of black moneyYour AnswerMounting government expenditure , Deficit financing and increase in money supply , Role of black money

Multiple Choice Multiple AnswerQuestionManagerial economics deals withCorrect AnswerIntegration of economic theory with business practice , Using logic of economics, mathematics& statistics. , The use of economic modes of thought to analyze business solution.Your Answer



Integration of economic theory with business practice , Using logic of economics, mathematics& statistics.


The sources of economic problems are:Correct AnswerMan has unlimited wants or ends , The means or resources to satisfy them are limited. , Theseresources are not specific but have alternative uses.Your AnswerMan has unlimited wants or ends , The means or resources to satisfy them are limited. , Theseresources are not specific but have alternative uses.

Multiple Choice Multiple AnswerQuestionDifferent types of business organizations are;

Correct AnswerPrivate sector. , Public sector. , Joint sector.Your AnswerJoint sector.

Multiple Choice Multiple AnswerQuestionProprietary firm isCorrect AnswerOwned by a single person. , Easy to form. , An organization of single person.Your Answer

Owned by a single person.Multiple Choice Multiple AnswerQuestionMethods of measurement of elasticityCorrect AnswerPercentage Method , Point elasticity Method , Total outlay expenditure methodYour AnswerPercentage Method , Point elasticity Method , Total outlay expenditure method

Multiple Choice Multiple AnswerQuestionDemand forecasts are necessary for:Correct AnswerFulfillment of objective of the plans , Preparation of a budget , Expansion of firmsYour AnswerPreparation of a budget , Expansion of firms



Select The Blank QuestionEconomic theory provides the basis for the ________ _ making process, there is some differencebetween the generalization based on abstraction and actual practices. Besides economic theory,mat

Correct Answerdecision makingYour AnsweroptimalCorrect AnswerstatisticsYour Answer

Select The Blank QuestionThe resources of a society consist not only of the free gifts of nature such as ________ but also

of ________ and of all sorts of man made aids to further production.Correct Answerland and mineralsYour Answerland and mineralsCorrect Answerhuman capacityYour Answerhuman capacity

Select The Blank

QuestionIndividual or sole ________ , which is also called sole- ________ , or single entrepreneurship isthe most common, the simplest and the oldest form of business organisation.Correct AnswerproprietorshipYour AnswerproprietorshipCorrect Answertrader shipYour Answertrader ship

Select The Blank QuestionNominal cost is the ________ cost of production, it is also called expenses of production. Thereal cost is the ________ cost of production.Correct AnswermoneyYour Answer



opportunityCorrect AnsweropportunityYour Answergross

Select The Blank QuestionCosts may be classified as : (a) ________ , including material costs, wage cost and interest cost(b) ________ , including costs of advertising and (c) other costs, including insurance chCorrect AnswerProduction costsYour AnswerProduction costsCorrect AnswerSelling costs

Your AnswerSelling costs

Select The Blank QuestionThe costs of self owned resources, which are employed by the ________ , are non- expenditureor , ________Correct AnswerfirmYour Answerfirm

Correct Answerimplicit costs .Your Answerimplicit costs .




The study of the working and allocation of resources in the free market economies is the topic intheCorrect Answertheory of priceYour Answertheory of production








Multiple Choice Single AnswerQuestionManagerial economics aims at providing help in the firms isCorrect Answerdecision making

Your Answerdecision making

True/FalseQuestionThe federal government of U.S.A. does not face the basic economic problem.Correct AnswerFalseYour AnswerFalse

Multiple Choice Single AnswerQuestionIn equilibrium analysis of a firm, it is assumed that every individual proprietor exhibits rationaleconomicCorrect AnswerbehaviorYour Answerbehavior


Correct AnswerYour AnswerManagerial EconomicsPrescriptive in natureThe theory of distributionResourcesAlternative usesAlternative usesDivision of society‟s output of goods and services The theory of distributionPrescriptive in natureMotor carsTangible goodsTangible goodsWantsInsatiableInsatiable



True/FalseQuestionMarket price fluctuates very oftenCorrect AnswerTrue

Your AnswerFalse

Multiple Choice Single AnswerQuestionThe firm is the unit that makes the decisions regarding employment of and the output of commodities areCorrect Answerfactors of productionYour Answerfactors of production

Multiple Choice Single AnswerQuestionThe principle of exclusion cannot be applied to the goods which areCorrect AnswerindivisibleYour Answerinvisible


In the cost – benefit analysis, the firm step involved is that the investor has to choose a fewproject alternatives promising a rate of return which isCorrect AnswerhighYour Answerhigh

Multiple Choice Single AnswerQuestionMarket system of economy is characterized by consumer‟s Correct AnswersovereigntyYour Answerdemand

Multiple Choice Single AnswerQuestionIn case of a joint stock company, the liability of share holders isCorrect Answer



limitedYour Answerlimited

True/False

QuestionThe divisible goods, whose benefits can be priced, are called pure public goodsCorrect AnswerFalseYour AnswerTrue

True/FalseQuestionIn case of a proprietary firm the liability of the proprietor is limitedCorrect Answer

FalseYour AnswerFalse

True/FalseQuestionDuring the phase of depression, the level of national income and expenditure rises rapidlyCorrect AnswerFalseYour AnswerFalse

Multiple Choice Single AnswerQuestionAccording J.B.Clark, profit is the reward paid forCorrect AnswerdynamismYour Answerrisk bearing

Multiple Choice Single AnswerQuestionGross profit is the excess of total revenue of a firm over totalCorrect AnswerexpenditureYour Answerexpenditure




In general, the demand for necessaries is relativelyCorrect AnswerinelasticYour Answerelastic

True/FalseQuestionDemand for food grains is inelastic but the demand for wheat is elastic.Correct AnswerTrueYour AnswerFalse


Correct AnswerYour AnswerExcess supply can be defined asQuantity supplied minus quantity demandedQuantity supplied minus quantity demandedIf demand remain unchanged on increase in supply will result inA rise in equilibrium quantityThe supply is perfectly elasticMarket Price is a situation whichThe supply is perfectly elasticA rise in equilibrium quantity

The responsiveness of demand to change in price is measuredElasticity of demandIn the same proportionUnit income elasticity implies that asincome rises demand for a commodity risesIn the same proportionElasticity of demand

Select The Blank QuestionGreater scope for the ________ sector may mean incremental ________ , which connotes theexpansion of public sector undertakings, can be left to some private companiesCorrect AnswerprivateYour AnswerinvestmentCorrect AnswerdisinvestmentsYour Answergrowth



Multiple Choice Single AnswerQuestionGoods produced on small scale of supply isCorrect Answerinelastic

Your Answerzero elastic


True/FalseQuestionContraction of supply is traced by the downward movement on the supply curve.Correct AnswerTrueYour AnswerTrue

True/FalseQuestionThe laws of returns to scale explain the behavior of output in response to changes in scale.


True/FalseQuestionIn the stage I of the law of diminishing returns, the marginal product goes on increasingCorrect AnswerTrueYour AnswerFalse

Multiple Choice Multiple AnswerQuestionFeatures of monopolistic CompetitionCorrect AnswerFairly Large number of firms , Product differentiation , Selling costs are existed



Your AnswerFairly Large number of firms , Product differentiation , Selling costs are existed


Where ________ is charging a ________ in the home market and a lower price in theinternational market, it is called DumpingCorrect AnswermonopolistYour Answera firmCorrect Answerhigher priceYour Answerhigher price

Select The Blank QuestionThe number of sellers operating under this type of competition is ________ under oligopoly, butless than under ________Correct Answerlarger thanYour AnswercomplementaryCorrect Answerperfect ompetitionYour Answer

perfect ompetitionMultiple Choice Multiple AnswerQuestionMarginal Propensity to consumeCorrect AnswerIt is defined as the ratio of the change in consumption to the change in income , It is rate of change in the average propensity to consume as income changes , It is derived by the formulampc= change in C/change in YYour AnswerIt is defined as the ratio of the change in consumption to the change in income , It is derived bythe formula mpc= change in C/change in Y , It is derived by dividing the change in income bychange in the consumption expenditure

Multiple Choice Multiple AnswerQuestionInvestmentCorrect AnswerIt adds to capital equipments , It leads to increase in level of income , It includes new plant and



equipmentYour AnswerIt adds to capital equipments , It leads to increase in level of income , It includes new plant andequipment

Multiple Choice Multiple AnswerQuestionFeatures of stage of expansion in business cycle areCorrect AnswerRise in national output , Rise in consumer and capital expenditure , Bank advances grow rapidlyYour AnswerRise in national output , Rise in consumer and capital expenditure , Bank advances grow rapidly

Multiple Choice Multiple AnswerQuestionCharacteristics of Depression

Correct AnswerDecrease in economic activities , The growth rate becomes negative , The level of nationalincome declines rapidlyYour AnswerDecrease in economic activities , The growth rate becomes negative

Multiple Choice Multiple AnswerQuestionRecession includesCorrect AnswerThe demand is halted , Increase in production of goods , Inventories piling up in stocks

Your AnswerThe demand is halted , Inventories piling up in stocks


Select The Blank QuestionThe rate of interest, according to ________ , depends upon two factors: (i) ________ and (ii) thequantity of moneyCorrect AnswerKeynesYour AnswerKeynes



Correct Answerthe liquidity preference functionYour Answerthe liquidity preference function

Select The Blank QuestionIn the words of ________ , “inflation occurs when the ________ of prices and cost is rising”. Correct AnswerProf. SamuelsonYour AnswerProf. SamuelsonCorrect Answergeneral levelYour Answergeneral level

Multiple Choice Multiple AnswerQuestionForms of Public EnterprisesCorrect AnswerPublic Corporations , Departmental management , Company Management or management byboardsYour AnswerDepartmental management , Public Corporations


QuestionSpecific organizational goals of Firms are:Correct AnswerMaximisation of profit , Reasonable Profit Target , Sales revenue MaximizationYour AnswerMaximisation of profit , Reasonable Profit Target , Sales revenue Maximization

Multiple Choice Multiple AnswerQuestionIndividual Demand Schedule:Correct AnswerIs in tabular form , It shows the prices of goods , It shows the quantities of a commoditypurchasedYour AnswerIs in tabular form , It shows the prices of goods , It shows the quantities of a commoditypurchased




The production function can be explained by:Correct AnswerLaw of variable proportions , Laws of returns to scale , Optimum combinations of inputsYour AnswerLaw of variable proportions , Laws of returns to scale , Optimum combinations of inputs

Multiple Choice Multiple AnswerQuestionImplicit costs are:Correct AnswerCost on self owned resources , Costs of salary of the proprietor , Interest on the entrepreneur‟sown investmentYour AnswerCost on self owned resources , Interest on the entrepreneur‟s own investment

Select The Blank

QuestionManagerial ________s generally refers to the integration of economic theory with ________practice.Correct AnswereconomicYour AnswereconomicCorrect AnswerbusinessYour Answerbusiness

Select The Blank QuestionIn a competitive industry, there is a large number of firms so that the action of ________ firmhas ________ on the price and output of the whole industry.Correct Answera singleYour Answera singleCorrect Answerno effectYour Answerno effect

Select The Blank QuestionAs per the International Labour Organisation (ILO), _ ________ is a ________ association of individuals with limited income on the basis of equal rights and responsibilities for achievingcerta



Correct AnswerCo-operationYour AnswerCo-operationCorrect Answer

voluntaryYour Answervoluntary

Select The Blank QuestionThe word ________ has different meanings to businessmen, ________ , tax collectors, workersand economists and it is often used in a loose sense that buries its real significanceCorrect AnswerProfitYour Answer

ProfitCorrect AnsweraccountantsYour Answeraccountants

Select The Blank QuestionThe demand curve is ________ representation of a demand schedule, demand curve slopes________ ward from left to right.Correct Answer

graphicalYour AnswergraphicalCorrect AnswerdownYour Answerdown

Select The Blank QuestionThe ________ that is ________ is the opportunity cost of the commodity produced.Correct AnswersacrificedYour AnswercommodityCorrect AnswercommodityYour Answersacrificed






Multiple Choice Single AnswerQuestion Pure public goods are subject to the law of decreasing average cost, because of theCorrect Answer economies of scaleYour Answer economies of scale

Multiple Choice Single AnswerQuestion In the cost – benefit analysis, after formulating various alternative project capacity,each of them has to be examined in terms of itsCorrect Answer feasibilityYour Answer feasibility

True/FalseQuestion Bargaining is one of the remedies of corrective action.Correct Answer FalseYour Answer True


Defence service Indivisible Indivisible

Economic effects of public goods are Spill over effect Spill over effect

Selection or implementation Step of cost benefit analysis Step of cost benefit analysis

Production possibility frontier Maximization of output Maximization of output

Multiple Choice Multiple AnswerQuestion The advantage of cost-benefit analysis areCorrect Answer Maximization of social welfare , Objective measurement of the trade-off ,Maximization of difference between total benefits & total costsYour Answer Maximization of social welfare , Objective measurement of the trade-off ,Maximization of difference between total benefits & total costs

Multiple Choice Multiple AnswerQuestion The term externalities may also be referred as:Correct Answer Spill-over effects , Neighborhood effects , Third party effectsYour Answer Spill-over effects , Neighborhood effects , Third party effects








Select The Blank Question Modern economists treat social cost and benefits as ________ of private investmentand production decisions.Correct Answer externalitiesYour Answer disadvantages


Select The Blank Question In the context of formulating an investment project, ________ feasibility means theavailability of supervisors for implementing and running the project smoothly and professionally.Correct Answer management

Your Answer management

Select The Blank Question Prof. Sam Nelson calls risks from unsafe factories or nuclear power plants as ________economies.Correct Answer negativeYour Answer hazardous

Multiple Choice Single AnswerQuestion According to Lionel Robbins, “Economics is a science which studiesCorrect Answer human behavior

Your Answer social behaviorMultiple Choice Single AnswerQuestion Question related to the efficient production and allocation belong to the branch of economic theory calledCorrect Answer Welfare EconomicsYour Answer Business Economics

Multiple Choice Multiple AnswerQuestion Managerial economics deals withCorrect Answer Integration of economic theory with business practice , Using logic of economics, mathematics & statistics , The use of economic modes of thought to analyze businesssolutionYour Answer Integration of economic theory with business practice , Using logic of economics,mathematics & statistics , The use of economic modes of thought to analyze business solution

Multiple Choice Single AnswerQuestion The public sector is owned & controlled by



Correct Answer state enterprisesYour Answer state enterprises

Select The Blank Question Reasonable profit target as an alternative to the objective of profit maximization was

suggested by ________.Correct Answer Joel DeanYour Answer Joel Dean

Select The Blank Question “Homeostatic Approach” as an alternative objective of firms was suggested by________.Correct Answer Prof. Kenneth BouldingYour Answer Prof. Kenneth Boulding

Select The Blank

Question The form of organization which is best for self employment is ________.Correct Answer Sole traderYour Answer Sole trader

True/FalseQuestion Accounting profit takes in to account opportunity cost.Correct Answer FalseYour Answer False

Multiple Choice Single AnswerQuestion Complementary goods are demanded

Correct Answer jointlyYour Answer jointly

Multiple Choice Single AnswerQuestion If the substitutes are relatively costly then the demand for the commodity in questionwill beCorrect Answer moreYour Answer same

True/FalseQuestion There are no real exceptions to the law of demand


True/FalseQuestion Demand curve slopes downwards from left to right.Correct Answer TrueYour Answer True




Select The Blank Question Goods which are paradoxical to the law of demand are ________Correct Answer Giffen goods, ,Your Answer Giffen goods, ,


Normally the isoquant slopes upward from right to left. downward from right to left

Any straight line supply curve which cuts y axis will have zero elasticity of supply. perfectly

elastic

The market period supply curve for perishable commodities is perfectly inelastic. perfectlyinelastic.

A rightwards shift in supply schedule indicates an increase in supply. an increase in supply.

Multiple Choice Multiple AnswerQuestion Explicit costs areCorrect Answer Out of pocket costs , These are firms accounting expenses , Expenditure costsYour Answer Out of pocket costs , These are firms accounting expenses , Expenditure costs

Select The Blank Question Output rises in a lesser proportion to that of the increase in input, under the case of ________.Correct Answer decreasing returns to scaleYour Answer decreasing returns to scale


Multiple Choice Single AnswerQuestion Jevons‟ , the economists who defined the term „market‟ different from that of thetraditional sense is anCorrect Answer English economistsYour Answer English economists



Multiple Choice Single AnswerQuestion Economists have pointed out that the real world is full of Correct Answer Imperfect competitionYour Answer Imperfect competition

True/FalseQuestion A firm under perfect competition is a price maker.Correct Answer FalseYour Answer False

True/FalseQuestion Under perfect competition single seller can influence the price.Correct Answer FalseYour Answer False


Question Types of imperfect competition areCorrect Answer Monopoly , Duopoly , OligopolyYour Answer Monopoly , Duopoly , Oligopoly

Multiple Choice Multiple AnswerQuestion Features of Pure Competition areCorrect Answer Large number of buyers and sellers , Homogeneous products , Free entry andfree exit of firmsYour Answer Large number of buyers and sellers , Homogeneous products , Free entry and freeexit of firms

Multiple Choice Multiple AnswerQuestion Equilibrium is the stage of Correct Answer maximum satisfaction , balance , stationaryYour Answer maximum satisfaction , balance

Multiple Choice Single AnswerQuestion Inflation is a phenomena in which pricesCorrect Answer riseYour Answer rise


Question True inflation starts only after reaching the level of fullCorrect Answer EmploymentYour Answer Employment

True/FalseQuestion During inflation, the pensioners whose income is permanently fixed, are substantiallybenefited.




True/FalseQuestion Saving is a private virtue

Correct Answer TrueYour Answer True

Multiple Choice Multiple AnswerQuestion According to Keynes, Aggregate supply function refers toCorrect Answer the minimum price of revenue which the entrepreneurs must get , Associatedwith different levels of employment , Explains that the level of out put varies with the level of employmentYour Answer the minimum price of revenue which the entrepreneurs must get , Associated withdifferent levels of employment , Explains that the level of out put varies with the level of employment

Multiple Choice Multiple AnswerQuestion Marginal Propensity to consume is characterized as followsCorrect Answer It is defined as the ratio of the change in consumption to the change in income ,It is rate of change in the average propensity to consume as income changes , It is derived by theformula mpc= change in c/change in yYour Answer It is rate of change in the average propensity to consume as income changes , It isderived by the formula mpc= change in c/change in y , It is derived by dividing the change inincome by change in the consumption expenditure


Question During the period of depression various factors of production areCorrect Answer exhaustedYour Answer unutilized

True/FalseQuestion In general SBI uses its monetary policy to achieve a judicious balance between thegrowth of production and control of the general price level.Correct Answer FalseYour Answer False

True/FalseQuestion Public enterprises have shown a very high rate of return of the capital investedCorrect Answer FalseYour Answer False

Multiple Choice Multiple AnswerQuestion The meaning of monetary policy isCorrect Answer It is programmed of the central bank , It controls the total supply of money , Thebasic objective is to achieve economic stability



Your Answer It is programmed of the central bank , It controls the total supply of money , Thebasic objective is to achieve economic stability

Multiple Choice Multiple AnswerQuestion Main aims of the New Industrial Policy (1991) are

Correct Answer To unshackle the indian industrial economy from the cobwebs of unnecessarybureaucratic control , To introduce liberalization with a view to integrate the indian economywith the world economy , To remove restrictions on direct foreign investment as also to free thedomestic entrepreneur from the restriction of MRTP actYour Answer To unshackle the indian industrial economy from the cobwebs of unnecessarybureaucratic control , To introduce liberalization with a view to integrate the indian economywith the world economy , To remove restrictions on direct foreign investment as also to free thedomestic entrepreneur from the restriction of MRTP act

Multiple Choice Multiple AnswerQuestion Objectives of economic policy are

Correct Answer To increase the efficiency and international competitiveness of industrialproduction , To improve the performance and rationalize the scope of the public sector , Toreform and modernize the financial sectorYour Answer To increase the efficiency and international competitiveness of industrialproduction , To improve the performance and rationalize the scope of the public sector , Toreform and modernize the financial sector




Multiple Choice Single AnswerQuestionEvery nation‟s resources which are used to produce the quantities of goods and services thatwould be required to satisfy all its citizen‟s wants are Correct AnswerinsufficientYour Answerinsufficient

Match The FollowingQuestionCorrect AnswerYour AnswerManagerial economicsDecision making and forward planningDecision making and forward planningResources








scarcescarceCommoditiesgoods and servicesgoods and services

Human wantsunlimitedunlimitedGeneral Theory of Employment, Interest and MoneyJ. M. KeynesJ. M. Keynes

Multiple Choice Single AnswerQuestionThe feasibility, which includes the prospects of employment generation, development of backward areas, social groups comprises of

Correct AnswerEconomic feasibilityYour AnswerEconomic feasibility

Multiple Choice Single AnswerQuestionAs far as its use is concerned, tuning in of a radio can be categorized as:Correct AnswerDivisibleYour Answer

DivisibleTrue/FalseQuestionIn a market system of economy, there is no harmony between individual interests and interests of the community.Correct AnswerFalseYour AnswerFalse

True/FalseQuestionInstitution of private property is not an essential feature of Capitalism.Correct AnswerFalseYour AnswerFalse



Multiple Choice Multiple AnswerQuestionIn case of defense services, all the sections of the society are equally protected and benefited.The defense services in other words isCorrect Answer

indivisible in character , cannot be priced in the market , a public goodYour Answerindivisible in character , cannot be priced in the market

Select The Blank QuestionOn the ________ level, the summation of maximum individual welfare does not automaticallylead to maximum social welfare.Correct AnswermacroYour Answer

microSelect The Blank QuestionWhile discussing the product divisibility of public and private goods, the principle of ________may be applied in case of only those people who do not agree to pay or who cannot pay themarket priceCorrect AnswerexclusionYour Answerexceptions

Select The Blank QuestionThe goods become ________ only when each individual has an access to the entire amount of itand its use by the individual does not reduce its availability to others.Correct AnswerindivisibleYour Answerpublic

Select The Blank QuestionIn the context of formulation of an investment project, ________ feasibility means theavailability of land, plant, machinery, raw materials and technical know how etc.Correct AnswertechnicalYour Answertechnical



Select The Blank QuestionIn a market economy ________ is the best judge of personal interest.Correct Answerindividual

Your Answerindividual

True/FalseQuestionInflation reduces the purchasing power of people‟s income and savings. Correct AnswerTrueYour AnswerTrue

True/FalseQuestionIn a free-enterprise economy, the problems of what how and for whom are solved by a planningcommitteeCorrect AnswerFalseYour AnswerFalse


A technical unit of given capacity of output isCorrect AnswerplantYour Answerplant

Multiple Choice Multiple AnswerQuestionPreference Shares can be classified asCorrect AnswerSimple Shares , Cumulative Shares , Redeemable SharesYour AnswerSimple Shares , Redeemable Shares

Multiple Choice Multiple AnswerQuestionThe sole proprietorship type of organization is found inCorrect AnswerAgriculture, , Retail trade, , Hotel,



Your AnswerAgriculture, , Retail trade, , Hotel,


Co-operative organizations isCorrect Answervoluntary organization , managed by democratic principle , organization, which performs itsbusiness within the membersYour Answervoluntary organization , managed by democratic principle , non profit motive organization

Select The Blank QuestionA private limited company can be formed with 2 to 50 members maximum, excluding ________Correct Answer

employee shareholdersYour AnswerDirectors

Multiple Choice Single AnswerQuestionThe method of inventory valuation in which , the cost of production is calculated on theassumption that the material which was last to enter the inventory of the company was used firstisCorrect AnswerLIFO

Your AnswerLIFO

True/FalseQuestionProfit should be large enough for a plough – back for business expansion.Correct AnswerTrueYour AnswerTrue

True/FalseQuestionAccounting profit takes in to account opportunity cost.Correct AnswerFalseYour AnswerTrue



Multiple Choice Multiple AnswerQuestionProfit is regarded asCorrect Answerincome accruing to the equity holders , wages accrue to the labour , rent accrue to the owner

Your Answerincome accruing to the equity holders , rent accrue to the owner

Multiple Choice Single AnswerQuestionChange in income of a person may result in demand for goods toCorrect AnswerchangeYour Answerchange

Multiple Choice Single AnswerQuestionWith decline in price of a commodity, total expenditure spent on the commodity is less thanbefore, then elasticity of demand for the commodity isCorrect Answer< 1Your Answer>1


Peas & beas, groundnut oil & til oil, tea & coffee are examples of Correct Answersubstitutes goodsYour Answersubstitutes goods

True/FalseQuestionDemand for luxury goods is inelasticCorrect AnswerFalseYour AnswerFalse

Match The FollowingQuestionCorrect AnswerYour AnswerIncrease in demand



Upward shift of the demand curveUpward movement on the demand curveExtension of demandDownward movement on the demand curveVertical Demand curve

Decrease in DemandLeftward shift of the demand curveDownward movement on the demand curveContraction of DemandUpward movement on the demand curveLeftward shift of the demand curve

Select The Blank QuestionIncrease in consumer‟s income leads in the demand for inferior goods to ________ Correct Answer

decreaseYour Answerdecrease

Multiple Choice Multiple AnswerQuestionReasons for change in Demand (Increase or Decrease in Demand)Correct AnswerChange income of consumer , Change in population , Change in fashion and customsYour AnswerChange income of consumer , Change in population , Change in fashion and customs

Multiple Choice Single AnswerQuestionAVC is the per unit variable cost of Correct AnswerproductionYour Answerfixed variable





The production function can be explained byCorrect AnswerLaw of variable proportions , Laws of returns to scale , Optimum combinations of inputsYour AnswerLaw of variable proportions , Laws of returns to scale

Select The Blank QuestionOutput rises in a lesser proportion to that of the increase in input, under the case of ________.Correct Answerdecreasing returns to scaleYour Answerdecreasing returns to scale


The costs which cover the cost of advertising is ________.Correct AnswerSelling costYour AnswerIncremental cost

Select The Blank QuestionThe out of pocket costs are ________.Correct AnswerExplicit costs

Your AnswerExplicit costs

Select The Blank QuestionBy „ profits‟, the accountant means total revenue minus________. Correct AnswerExplicit costsYour AnswerFixed costs

Multiple Choice Single AnswerQuestionThe supply curve during market period isCorrect Answerperfectly inelasticYour Answerperfectly inelastic



Multiple Choice Single AnswerQuestionUnder monopoly entry of new firms isCorrect Answerprohibited

Your Answerlimited

True/FalseQuestionIn case of the co-operative societies supplying cheap inputs or supplying consumer products atfair prices, a system of subsidized pricing is followed.Correct AnswerTrueYour AnswerTrue

True/FalseQuestionMarket price fluctuates very often.Correct AnswerTrueYour AnswerTrue


Macro Economics is the study of Correct AnswerThe aggregate behavior of the economy , The behavior of economic agents , Problems such asthe rates of inflation, the balance of payments, etcYour AnswerThe aggregate behavior of the economy , Problems such as the rates of inflation, the balance of payments, etc , Economic welfare

Multiple Choice Multiple AnswerQuestionThe subject matter of Micro economics includes the study of Correct Answeran individual consumer , particular market for a given commodity , operation of a firmYour Answeran individual consumer , particular market for a given commodity , major economic issues ,problems & policies




16. The phase of recovery denotesCorrect AnswerMore employment opportunities , Increase in profitability , Wage rate increaseYour AnswerMore employment opportunities , Increase in profitability , Wage rate increase

Multiple Choice Multiple AnswerQuestionQuantitative credit control measures areCorrect Answeropen market operations , changes in bank rates , changes in statutory reserve ratioYour Answeropen market operations , moral suasion


The government has adopted a system of dual prices in the case of Correct Answeressential goodsYour Answeressential goods

Multiple Choice Multiple AnswerQuestionThe disinvestments of industries is needed forCorrect AnswerPhased privatization , Reducing deficit , Capital support to plans

Your AnswerPhased privatization , Reducing deficit , Capital support to plans



LIST OF ATTEMPTED QUESTIONS AND ANSWERS ME1

Question In India, the first phase of economic reforms is believed to have begun in 1985 whenVishwanath Pratap Singh was the Prime Minister of the country.


Question Price discrimination is possible in case of Correct Answer public utilities with legal sanction , personnel services sold , geographicalbarriersYour Answer public utilities with legal sanction , personnel services sold , geographical barriers








Question The methods of calculating depreciation isCorrect Answer Diminishing Balance Method , Annuity Method , Service Unit MethodYour Answer Diminishing Balance Method , Annuity Method , Service Unit Method

Question Correct Answer Your Answer

Break even point T.R. = T.C. T.R. = T.C.

Normal profit Implicit cost Short run cost

Average variable cost (A.V.C.) Short run cost Explicit cost

Change in supply Increase and decrease in supply Expansion and contraction of supply

Question A competitive industry has three basic characteristicsCorrect Answer Large Number of Firms , Homogeneous Product , Free entry and exit

Your Answer Large Number of Firms , Homogeneous Product , Free entry and exit

Question To solve the unemployment problem , the level of effective demand must decrease.Correct Answer FalseYour Answer True

Question The act of using goods and services to satisfy wants is calledCorrect Answer consumptionYour Answer consumption

Question The minimum number of directors which public limited should have is ________.

Correct Answer 3Your Answer 3

Question The factors of production areCorrect Answer Labour , Land , CapitalYour Answer Labour , Land , Profit

Question Economists have pointed out that the real world is full of Correct Answer Imperfect competitionYour Answer Monopolistic competition

Question According to J.M. Keynes, the equilibrium between the aggregate demand function andthe aggregate supply function can, and often does take place atCorrect Answer less than full employmentYour Answer full employment

Question Important theories of profits areCorrect Answer Uncertainty-bearing theory of profit , Dynamic theory of profit , Life cycle



theoryYour Answer Risk taking theory , Uncertainty-bearing theory of profit , Dynamic theory of profit

Question The things that are produced by factors of production are calledCorrect Answer commodities

Your Answer commodities

Question Demand is determined byCorrect Answer Price of the product , Relative prices of other goods , Tastes and habitsYour Answer Price of the product , Relative prices of other goods , Tastes and habits

Question The necessary condition of profit maximization of a firm is that Marginal Revenue(M.R) must be equal to ________.Correct Answer Marginal cost (M.C)Your Answer Marginal cost (M.C)

Question The concept of just distribution of national product is aCorrect Answer normativeYour Answer objective

Question Dalal Street in Bombay is known asCorrect Answer Bombay Stock ExchangeYour Answer Bombay Stock Exchange

Question The type economic problem isCorrect Answer universalYour Answer universal

Question Preference share holders get a rate of dividend which isCorrect Answer fixedYour Answer high

Question The act of making goods and services is calledCorrect Answer productionYour Answer production

Question Contraction of supply is traced by the downward movement on the supply curveCorrect Answer True

Your Answer TrueQuestion Baumol has suggested as an alternative objective for profit maximization , themaximization of ________Correct Answer salesYour Answer sales




Commodities goods and services goods and services

Human wants unlimited unlimited

General Theory of Employment, Interest and Money J. M. Keynes J. M. Keynes

Managerial economics Decision making and forward planning Decision making and forwardplanning

Resources scarce scarce

Question In the traditional concept of equil ibrium, a firm attains the equilibrium when the firm‟sTotal Revenue (T.R.) =Total Cost (T.C.).

Correct Answer FalseYour Answer True

Question Under cost plus pricingCorrect Answer The price is set to cover material, labour cost , Actual costs, standard costs areincluded , Certain percentage of profit also includedYour Answer The price is set to cover material, labour cost , Actual costs, standard costs areincluded , Certain percentage of profit also included

Question In economics, supply is considered to be aCorrect Answer relative term

Your Answer relative term

Question In economics the question related to the selection of methods with which commoditiesare produced is a subject matter of Correct Answer theory of productionYour Answer theory of production

Question Under the decreasing returns to scale, the marginal output curve slopes ________.Correct Answer downwardYour Answer downward

Question Managerial economics generally refers to the integration of economic theory withbusinessCorrect Answer PracticeYour Answer Practice

Question Steps in cost benefit analysisCorrect Answer Identification of a project , Formulation of the project , Appraisal and selectionof the project



Your Answer Identification of a project , Formulation of the project , Appraisal and selection of the project

Question Slope of supply curve isCorrect Answer positive

Your Answer positive

Question The salary of the proprietor or rent on own land are the ________.Correct Answer Implicit costYour Answer Implicit cost

Question The profits which must be deducted from the gross profits to arrive at net profits areCorrect Answer Monopoly ProfitsYour Answer Monopoly Profits

Question We say that a nation faces economic problems , under following conditions

Correct Answer Man has unlimited wants or ends , The means or resources to satisfy them arelimited , These resources are not specific but have alternative usesYour Answer Man has unlimited wants or ends , The means or resources to satisfy them arelimited , These resources are not specific but have alternative uses

Question A shift in the demand curve to the left shows increase in demand.Correct Answer FalseYour Answer False

Question The sum of total fixed costs and total variable costs is the total cost.Correct Answer True

Your Answer TrueQuestion A Joint- Stock Company is owned by its share holders but it is managed byCorrect Answer Board of DirectorsYour Answer Non-government organization

Question The liability of a Karta in a Joint Hindu Family Business firm is ________.Correct Answer limitedYour Answer joint

Question A fall in price tends the demand for goods to ________

Correct Answer expandYour Answer increase

Question The supply curve slopes downwards from left to right.Correct Answer FalseYour Answer False



Question Poverty is the root cause of Economic problem.Correct Answer FalseYour Answer False

Question Every nation‟s resources which are used to produce the quantities of goods and services

that would be required to satisfy all its citizen‟s wants are Correct Answer insufficientYour Answer insufficient

Question In case of a proprietory firm, the liability for all his debts isCorrect Answer unlimitedYour Answer unlimited

Question The city of Kashmir has specialized in the manufacture of Correct Answer shawlsYour Answer shawls

Question The Laws of Returns to scale areCorrect Answer Law of Increasing Returns to Scale , Law of Constant Returns to Scale , Law of Decreasing Returns to scaleYour Answer Law of Increasing Returns to Scale , Law of Constant Returns to Scale , Law of Decreasing Returns to scale

Question Managerial economics is also understood to refer toCorrect Answer applied economicsYour Answer applied economics

Question The registration of a partnership firm is voluntaryCorrect Answer True Your Answer True




Question A responsible factor for inflation isCorrect Answer hike in pricesYour Answer hike in prices

Question Economists call all human resources asCorrect Answer laborYour Answer labor

Question The wage and salary earners who get fixed income in terms of money are benefitedduring inflation.









Question Over the years in India the govt. expenditure isCorrect Answer increasing

Your Answer increasing

Question Given the price, if the cost of production increases because of higher price of rawmaterials, the supplyCorrect Answer decreasesYour Answer decreases

Question All the man made resources which are used in the process of making other goods andservices are calledCorrect Answer capitalYour Answer capital

Question Micro-economics is primarily concerned with the problem of what, how and for whomto produce?Correct Answer FalseYour Answer False

Question Inflation is characterized by excess of demand.Correct Answer TrueYour Answer True

Question Individual Demand Schedule

Correct Answer Is in tabular form , It shows the prices of goods , It shows the quantities of acommodity purchasedYour Answer Is in tabular form , It shows the prices of goods , It shows the quantities of acommodity purchased

Question Measurement of profit becomes difficult because of the difficulty involved in thecalculation of depreciation.Correct Answer TrueYour Answer False

Question Main aims of the New Industrial Policy (1991) are

Correct Answer To unshackle the indian industrial economy from the cobwebs of unnecessarybureaucratic control , To introduce liberalization with a view to integrate the indian economywith the world economy , To remove restrictions on direct foreign investment as also to free thedomestic entrepreneur from the restriction of MRTP actYour Answer To unshackle the indian industrial economy from the cobwebs of unnecessarybureaucratic control , To introduce liberalization with a view to integrate the indian economywith the world economy , To remove restrictions on direct foreign investment as also to free thedomestic entrepreneur from the restriction of MRTP act



Question Free riders‟ is a term associated with the people who would like to have benefit of agood without sharing the cost of its supply.Correct Answer TrueYour Answer True

Question Managerial economics aims at providing help in the firms isCorrect Answer decision makingYour Answer decision making

Question The persons who own the ________hip concern are called Partners.Correct Answer PartnersYour Answer Partners

Question The minimum number of directors which private limited should have is ________.Correct Answer 2Your Answer 2

Question Generally, the larger the income of a consumer, his demand for overall commoditiestends to be relatively elastic.Correct Answer FalseYour Answer True


Resource allocation decisions in free market economy Theory of price Theory of price

Economic problem Universal Universal

Managerial Economics Applied branch of knowledge Applied branch of knowledge

Inflation Reduction in purchasing power Reduction in purchasing power

Waste of resources Involuntary unemployment Involuntary unemployment

Question In the context of externalities, driving the smoke-emitting buses and trucks in the citiesis an example of ________ cost.Correct Answer socialYour Answer environmental


Variable cost can refer to operating costs alone. operating costs alone.

The relationship between price and the quantity supplied of a product is indicated by upwardsloping curve. upward sloping curve.



Elasticity of supply means change in supply due to change in price of commodity. price of commodity.

Fixed cost is known as prime cost. prime cost.

Question Cost-benefit analysis refers to the analysis undertaken to judge any projects ________whether government or private and find out its worth.Correct Answer investmentsYour Answer investments

Question Variable cost are those costs which vary with the level of Correct Answer outputYour Answer output

Question An individual consumer or particular market for a given commodity are the subjectmatter of

Correct Answer Micro EconomicsYour Answer Micro Economics

Question In the Dynamic Theory of Profit, Prof. Clark has pointed out the types of changes,which areCorrect Answer Changes in the supply of capital , Changes in population , Changes in thetechniques of productionYour Answer Changes in the supply of capital , Changes in population , Changes in thetechniques of production

Question Given the price, if the cost of production of a commodity decreases because of the use

of improved technique of production, there will be increase in supply.Correct Answer TrueYour Answer True

Question True inflation starts only after reaching the level of fullCorrect Answer EmploymentYour Answer Employment

Question All the free gifts of nature which are commonly called natural resources are known toeconomists asCorrect Answer Land

Your Answer LandQuestion Reasons for need of public distribution system areCorrect Answer To maintain stable price conditions , To bring an efficient management of thesupply , To supply the necessary goods to people at reasonable priceYour Answer To maintain stable price conditions , To bring an efficient management of thesupply , To supply the necessary goods to people at reasonable price



Question Production Function implies relationship betweenCorrect Answer input & outputYour Answer input & output

Question The important determinants of supply are

Correct Answer Always referred to in relation to price & time , Government policy , Availabilityof factors of productionYour Answer Always referred to in relation to price & time , Government policy , Availability of factors of production

Question In economics the questions related to the division of society‟s output of goods andservices among its members are topics inCorrect Answer theory of distributionYour Answer theory of distribution

Question Demand for a commodity depends on the relative price of its ________

Correct Answer substitute goodsYour Answer substitute goods

Question In case of the co-operative societies supplying cheap inputs or supplying consumerproducts at fair prices, a system of subsidized pricing is followed.Correct Answer TrueYour Answer False

Question During periods of inflation, the income of farmers as a class decreases.Correct Answer TrueYour Answer True

Question By „ profits‟, the accountant means total revenue minus________. Correct Answer Explicit costsYour Answer Sunk cost

Question The index numbers which measure the changes in the general price level of a countryrefers to ________Correct Answer Wholesale prices indexYour Answer Commodity prices index

Question The study of the working and allocation of resources in the free market economies is

the topic in theCorrect Answer theory of priceYour Answer theory of price

Question According to the Government, the buildup of inflationary pressure during the Ninetieswas attributed toCorrect Answer Higher Fiscal deficitYour Answer Higher Fiscal deficit



Question In economics the questions related to the dynamic or static ( otherwise) capacity of theeconomy to produce goods and services are topics in theCorrect Answer theory of economic growthYour Answer theory of economic growth

Question Increasing Returns explainsCorrect Answer Total product increases at an increasing rate , Marginal product increasing and itis maximum , Average product is increasing but it is below MPYour Answer Total product increases at an increasing rate , Marginal product increasing and it ismaximum , Average product is increasing but it is below MP

Question Implicit costs areCorrect Answer Cost on self owned resources , Costs of salary of the proprietor , Interest on theentrepreneur‟s own investment Your Answer Cost on self owned resources , Costs of salary of the proprietor , Interest on theentrepreneur‟s own investment

Question Characteristics of the phase of Depression areCorrect Answer Decrease in economic activities , The growth rate becomes negative , The levelof national income declines rapidlyYour Answer Decrease in economic activities , The growth rate becomes negative , The level of national income declines rapidly

Question Micro-economic theory studies how a free enterprise economy determines the price of economic resourcesCorrect Answer FalseYour Answer True

Question Economists like A.C.Harberger have shown that the cost benefit analysis can beapplied to ________ analysis.Correct Answer general equilibriumYour Answer general equilibrium

Question Break-Even analysis is derived byCorrect Answer Fixed cost , Average variable cost , Quantity of goods and priceYour Answer Fixed cost , Average variable cost , Quantity of goods and price

Question Managerial economics deals with

Correct Answer Integration of economic theory with business practice , Using logic of economics, mathematics & statistics , The use of economic modes of thought to analyze businesssolutionYour Answer Integration of economic theory with business practice , Using logic of economics,mathematics & statistics , The use of economic modes of thought to analyze business solution











Question In the context of formulation of an investment project, ________ feasibility means the

availability of land, plant, machinery, raw materials and technical know how etc.Correct Answer technicalYour Answer infrastructure

Question Scarcity of resources is the root cause of economic problem.Correct Answer TrueYour Answer True

Question Inflation reduces the purchasing power of people‟s income and savings. Correct Answer TrueYour Answer True

Question Demand for safety pins is ________Correct Answer inelasticYour Answer relatively inelastic

Question Reasonable profit target as an alternative to the objective of profit maximization wassuggested by ________.Correct Answer Joel DeanYour Answer Joel Dean


Motor cars Tangible goods Tangible goods

Wants Insatiable Insatiable

Managerial Economics Prescriptive in nature Prescriptive in nature

Resources Alternative uses Alternative uses

Division of society‟s output of goods and services The theory of distribution The theory of distribution

Question Output rises in a lesser proportion to that of the increase in input, under the case of ________.Correct Answer decreasing returns to scaleYour Answer decreasing returns to scale



































Question Social costs cannot be included in a firm‟s account book. Correct Answer TrueYour Answer False

Question Economic problem arises only in case of an overpopulated country.


Question The cost which enter the accounts book of the firm are referred as ________.Correct Answer Accounting costYour Answer Accounting cost

Question The question regarding the nature and quantities of commodities to be produced issolely restricted to capitalist economies.Correct Answer FalseYour Answer True

Question There are no real exceptions to the law of demandCorrect Answer FalseYour Answer False

Question The federal government of U.S.A. does not face the basic economic problem.Correct Answer FalseYour Answer False

Question The subject matter of managerial economics covers two important areas namelydecision-making and

Correct Answer forward PlanningYour Answer forward Planning


Decrease in Demand Leftward shift of the demand curve Leftward shift of the demand curve

Contraction of Demand Upward movement on the demand curve Upward movement on thedemand curve

Increase in demand Upward shift of the demand curve Upward shift of the demand curveExtension of demand Downward movement on the demand curve Downward movement on thedemand curve

Question The promoters of a company can get incorporated by filing with the registrarof companies various documents such as





































Correct Answer Memorandum of Association , Articles of Association , ProspectusYour Answer Articles of Association , Prospectus

Question Features of public sector enterprisesCorrect Answer it is controlled by the state , separate funds to undertake their activity , they are

accountable to publicYour Answer it is controlled by the state , separate funds to undertake their activity , they areaccountable to public

Question The production function studiesCorrect Answer Input and out put relation , Factors of production and final production ,Technology used in productionYour Answer Input and out put relation , Factors of production and final production , Demandfor production

Question In the 3rd stage of operation of the law of variable proportions, the marginal product

becomes ________.Correct Answer negativeYour Answer negative

Question In a market economy ________ is the best judge of personal interest.Correct Answer individualYour Answer public

Question All the buyers and sellers operating under perfect competition have knowledge whichisCorrect Answer perfect

Your Answer perfectQuestion In a market system of an economy, producers are guided by ________ motive.Correct Answer profitYour Answer profit

Question The cost recorded in the books of accounts are considered asCorrect Answer explicit costsYour Answer explicit costs

Question Demand forecasts are necessary for

Correct Answer Fulfillment of objective of the plans , Preparation of a budget , Expansion of firmsYour Answer Fulfillment of objective of the plans , Preparation of a budget , Expansion of firms

Question Inflation reduces the purchasing power of money and savings.Correct Answer TrueYour Answer True







































Question Features of an Industry areCorrect Answer All firms dealing in the same line of business , The ownership and managementof each firm is different , Is a group of firmsYour Answer All firms produce different goods , All firms dealing in the same line of business ,The ownership and management of each firm is different

Question The characteristics of a sole proprietorship firm isCorrect Answer Unlimited Capital , Ownership by a single person , Easy to formYour Answer Ownership by a single person , Easy to form

Question Normally, a larger quantity is demanded atCorrect Answer lower priceYour Answer lower price

Question When a company rasies additional finance by borrowing from the public for a specificperiod of time at a particular rate of interest, it is called as

Correct Answer DebenturesYour Answer Debentures

Question In cost benefit analysis, in the valuation of costs and benefits, for finding the presentvalue, one has to make use of Correct Answer discount rateYour Answer discount rate

Question Like a particular street in a city , the entire city may sometimes specialize in theproduction of a particular commodity . The city acquire the status of aCorrect Answer national market

Your Answer capital marketQuestion Types of Share capital of Joint-Stock Company areCorrect Answer registered or authorized capital , issued capital , paid-up capitalYour Answer registered or authorized capital , issued capital , paid-up capital

Question An upward sloping demand curve is called ________Correct Answer exceptional demand curveYour Answer exceptional demand curve

Question Different types of Elasticity of Demand are

Correct Answer Price elasticity of demand , Income elasticity of demand , Cross elasticity of demandYour Answer Price elasticity of demand , Income elasticity of demand , Cross elasticity of demand

Question Cournot‟ , the economists who defined the term „market‟ diff erent from that of thetraditional sense is an








































Correct Answer French economistsYour Answer French economists

Question Demand forecasting is predicting for the demand of a firm‟s product in Correct Answer future

Your Answer future

Question Pure inflation starts only after reaching the full employment level.Correct Answer TrueYour Answer True

Question A monopolist in a price maker.Correct Answer TrueYour Answer True

Question The demand curve (A.R.) of a firm under perfect competition is

Correct Answer perfectly elasticYour Answer perfectly elastic

Question Managerial economics aims at providing guidance to the firms forCorrect Answer decision makingYour Answer decision making

Question In case of defense services, all the sections of the society are equally protected andbenefited. The defense services in other words isCorrect Answer indivisible in character , cannot be priced in the market , a public goodYour Answer indivisible in character , cannot be priced in the market

Question A fall in quantity demanded without a fall in price shows decrease in demand.Correct Answer TrueYour Answer True

Question The subject matter of macro – economics includes the theory of income andemployment at an individual level.Correct Answer FalseYour Answer False




Multiple Choice Multiple AnswerQuestion Types of Share capital of Joint-Stock Company are







































Correct Answer registered or authorized capital , issued capital , paid-up capitalYour Answer registered or authorized capital , issued capital , paid-up capital


Equilibrium price is the price where the quantity demanded equals quantity supplied quantitydemanded equals quantity supplied

Excess supply can be defined as quantity supplied minus quantity demanded. quantity suppliedminus quantity demanded.

Tea and sugar Complimentary goods Complimentary goods

Excess demand can be defined as quantity demanded minus quantity supplied quantity demandedminus quantity supplied

Multiple Choice Single AnswerQuestion The act of making goods and services is calledCorrect Answer productionYour Answer production

Multiple Choice Single AnswerQuestion The act of using goods and services to satisfy wants is calledCorrect Answer consumptionYour Answer consumption

Select The Blank Question The liability of a Karta in a Joint Hindu Family Business firm is ________.Correct Answer limitedYour Answer limited

Select The Blank Question Demand for a commodity depends on the relative price of its ________Correct Answer substitute goodsYour Answer substitute goods


Question reasonable profit‟ are Correct Answer Capital Attraction , Plough Back , Normal earningsYour Answer Capital Attraction , Plough Back , Normal earnings

Multiple Choice Multiple AnswerQuestion Features of Long -run market areCorrect Answer It is durable goods market , Supply can be increased or reduced according to thedemand , Sellers at least recover minimum price for their goods



Your Answer It is durable goods market , Supply can be increased or reduced according to thedemand , Sellers at least recover minimum price for their goods

Multiple Choice Single AnswerQuestion The type economic problem is

Correct Answer universalYour Answer universal

Select The Blank Question In a market system of an economy, producers are guided by ________ motive.Correct Answer profitYour Answer profit

Multiple Choice Single AnswerQuestion An individual consumer or particular market for a given commodity are the subjectmatter of

Correct Answer Micro EconomicsYour Answer Micro Economics

Select The Blank Question The index numbers which measure the changes in the general price level of a countryrefers to ________Correct Answer Wholesale prices indexYour Answer Wholesale prices index

Multiple Choice Single AnswerQuestion While calculating accounting profit, the costs which are considered are by nature

Correct Answer explicitYour Answer implicit

Multiple Choice Single AnswerQuestion Given the price, if the cost of production increases because of higher price of rawmaterials, the supplyCorrect Answer decreasesYour Answer decreases

Multiple Choice Single AnswerQuestion The things that are produced by factors of production are called

Correct Answer commoditiesYour Answer commodities

Multiple Choice Single AnswerQuestion The concept of just distribution of national product is aCorrect Answer normativeYour Answer normative



Multiple Choice Single AnswerQuestion In economics the question related to the selection of methods with which commoditiesare produced is a subject matter of Correct Answer theory of productionYour Answer theory of production

True/FalseQuestion In case of the co-operative societies supplying cheap inputs or supplying consumerproducts at fair prices, a system of subsidized pricing is followed.Correct Answer TrueYour Answer True

Select The Blank Question Modern economists treat social cost and benefits as ________ of private investmentand production decisions.Correct Answer externalities

Your Answer externalities

Multiple Choice Multiple AnswerQuestion The market system of economy is based on the following foundations:Correct Answer Consumer‟s Sovereignty , Non -interference by the state. , Private Profit MotiveYour Answer Consumer‟s Sovereignty , Private Profit Motive , Existence of monopoly

Select The Blank Question The indivisible goods to which the principle exclusion does not apply are called________ goods.Correct Answer pure public

Your Answer privateSelect The Blank Question The goods become ________ only when each individual has an access to the entireamount of it and its use by the individual does not reduce its availability to others.Correct Answer indivisibleYour Answer public

Multiple Choice Single AnswerQuestion The city of Banaras has specialized in the manufacture of Correct Answer silk Your Answer silk

True/FalseQuestion During inflation, the pensioners whose income is permanently fixed, are substantiallybenefited.Correct Answer FalseYour Answer False




True/FalseQuestion Generally, the larger the income of a consumer, his demand for overall commoditiestends to be relatively elastic.Correct Answer FalseYour Answer False

Multiple Choice Single AnswerQuestion In economics the questions related to the division of society‟s output of goods andservices among its members are topics inCorrect Answer theory of distribution

Your Answer theory of distribution

True/FalseQuestion Supply management is related to the volume ofsupply & its distribution system.Correct Answer TrueYour Answer True

Select The Blank Question Demand for safety pins is ________Correct Answer inelasticYour Answer inelastic

Multiple Choice Single AnswerQuestion Every nation‟s resources which are used to produce the quantities of goods and servicesthat would be required to satisfy all its citizen‟s wants are Correct Answer insufficientYour Answer insufficient

True/FalseQuestion Under the disinvestments process, there is full transfer of ownershipCorrect Answer TrueYour Answer False

Multiple Choice Single AnswerQuestion In cost – benefit analysis, after the step of appraisal and selection of the project is thestep of Correct Answer comparison of the cash flowYour Answer comparison of the cash flow



Multiple Choice Single AnswerQuestion When a company rasies additional finance by borrowing from the public for a specificperiod of time at a particular rate of interest, it is called asCorrect Answer DebenturesYour Answer Debentures

Multiple Choice Multiple AnswerQuestion Features of market period areCorrect Answer Related to few hours or few days , Related to perishable goods , The entiresupply is to be disposed off on the same dayYour Answer Related to few hours or few days , Related to perishable goods , The entire supplyis to be disposed off on the same day

Select The Blank Question In the context of formulating an investment project, ________ feasibility means theavailability of supervisors for implementing and running the project smoothly and professionally.

Correct Answer managementYour Answer organizational

Multiple Choice Multiple AnswerQuestion Increasing Returns explainsCorrect Answer Total product increases at an increasing rate , Marginal product increasing and itis maximum , Average product is increasing but it is below MPYour Answer Total product increases at an increasing rate , Marginal product increasing and it ismaximum , Average product is increasing but it is below MP


Question Managerial economics generally refers to the integration of economic theory withbusinessCorrect Answer PracticeYour Answer Practice

Multiple Choice Multiple AnswerQuestion Scope of Managerial Economics deals withCorrect Answer Demand analysis and forecasting , Production function & cost analysis ,Inventory management adverting, price systemYour Answer Demand analysis and forecasting , Production function & cost analysis , Inventorymanagement adverting, price system

Multiple Choice Single AnswerQuestion The observation of economic histories of the United States & West European countriesshows that competition , the heart of market mechanism gives rise toCorrect Answer monopoliesYour Answer price competition




Chance profit Outbreak of war Outbreak of war

Innovation theory of profit Joseph Schumpeter Joseph Schumpeter

Uncertainly bearing F. H. Knight theory F. H. Knight theory

Implicit cost Opportunity cost Opportunity cost

Multiple Choice Single AnswerQuestion During a period of rising prices (inflation), the goods and services areCorrect Answer scarceYour Answer are also increasing

True/FalseQuestion Contraction of supply is traced by the downward movement on the supply curveCorrect Answer TrueYour Answer True

Multiple Choice Single AnswerQuestion Over the years in India the govt. expenditure isCorrect Answer increasingYour Answer increasing

True/False

Question To solve the unemployment problem , the level of effective demand must decrease.Correct Answer FalseYour Answer False

True/FalseQuestion Demand is related to price, time and place.Correct Answer TrueYour Answer False

Multiple Choice Single AnswerQuestion Managerial economics is also understood to refer to

Correct Answer applied economicsYour Answer applied economics

Select The Blank Question A fall in price tends the demand for goods to ________Correct Answer expand Your Answer expand











True/False

Question Macro economic studies are based on empirical evidence.Correct Answer TrueYour Answer True

Select The Blank Question According to the World Bank‟s approach, the trade able items would be valued at thecorresponding world prices and the non-trade able items at the ________.Correct Answer shadow pricesYour Answer market prices


Question The study of the working and allocation of resources in the free market economies isthe topic in theCorrect Answer theory of priceYour Answer theory of price

Multiple Choice Single AnswerQuestion Costs which increase because of the expansion of a firm are calledCorrect Answer incrementalYour Answer incremental

True/False

Question In the Long- run, supply of goods can be adjusted to the demand and therefore supplycurve is horizontal to the X-axis.Correct Answer FalseYour Answer True

Select The Blank Question By „ profits‟, the accountant means total revenue minus________. Correct Answer Explicit costsYour Answer Implicit cost


Question Features of short run period areCorrect Answer Supply of goods can be adjusted to the demand to some extent , Supply anddemand determine the price , Some factors can be changedYour Answer Supply of goods can be adjusted to the demand to some extent , Supply anddemand determine the price , Some factors can be changed

Select The Blank Question The law of constant returns to scale is depicted by the marginal output curve which is









































________.Correct Answer horizontalYour Answer horizontal


Question The method of calculating depreciation in which the actual working hours of a capitalasset are taken in to account isCorrect Answer service unitYour Answer service unit

True/FalseQuestion Demand curve slopes upwards from left to right.Correct Answer FalseYour Answer False


Question All the free gifts of nature which are commonly called natural resources are known toeconomists asCorrect Answer LandYour Answer Land

True/FalseQuestion Macro-economies is a policy oriented science.Correct Answer TrueYour Answer True


Question The assumption of perfect competition in all the analytical theories is made byCorrect Answer Classical economistsYour Answer Keynesian economists

Select The Blank Question In the 3rd stage of operation of the law of variable proportions, the marginal productbecomes ________.Correct Answer negativeYour Answer positive


Question Reasons for need of public distribution system areCorrect Answer To maintain stable price conditions , To bring an efficient management of thesupply , To supply the necessary goods to people at reasonable priceYour Answer To maintain stable price conditions , To bring an efficient management of thesupply , To supply the necessary goods to people at reasonable price

Select The Blank Question When demand for the product increases in the same proportion in which income









































increases, Income elasticity of demand will be equal to________Correct Answer unityYour Answer greater than unity


Question Accounting profit includesCorrect Answer wages , rent , interestYour Answer wages , rent , interest

Multiple Choice Multiple AnswerQuestion The fiscal policy includesCorrect Answer Formation of taxation policy , It is an instrument for economic stabilization ,Monitoring of public expenditureYour Answer Formation of taxation policy , It is an instrument for economic stabilization ,Monitoring of public expenditure

Multiple Choice Single AnswerQuestion The method of inventory valuation in which , the cost of production is calculated on theassumption that the material which was last to enter the inventory of the company was used firstisCorrect Answer LIFOYour Answer LIFO

Select The Blank Question A private limited company can be formed with 2 to 50 members maximum, excluding________Correct Answer employee shareholders

Your Answer employee shareholdersMultiple Choice Single AnswerQuestion The number of sellers operating under monopolistic competition as compare tooligopoly isCorrect Answer largerYour Answer larger

Multiple Choice Multiple AnswerQuestion Causes for rise in prices in IndiaCorrect Answer Mounting government expenditure , Deficit financing and increase in moneysupply , Role of black moneyYour Answer Mounting government expenditure , Deficit financing and increase in moneysupply , Increase in demand

True/FalseQuestion Social costs cannot be included in a firm‟s account book. Correct Answer TrueYour Answer False











































Multiple Choice Single AnswerQuestion AVC is the per unit variable cost of Correct Answer productionYour Answer total revenue

Multiple Choice Multiple AnswerQuestion Exceptions to the Law of Demand areCorrect Answer Giffen goods , Articles of snob appeal , SpeculationYour Answer Giffen goods , Articles of snob appeal , Speculation

Question In the cost – benefit analysis, the first step involved is that the investor has to choose afew project alternatives promising aCorrect Answer high rate of returnYour Answer high rate of return

Question In the Dynamic Theory of Profit, Prof. Clark has pointed out the types of changes,

which areCorrect Answer Changes in the supply of capital , Changes in population , Changes in thetechniques of productionYour Answer Changes in the supply of capital , Changes in population , Changes in thetechniques of production

Question Economic problem is faced by poor countrys only.Correct Answer FalseYour Answer False

Match The Following

Question Correct Answer Your AnswerPure private goods Divisible goods Divisible goods

Self -interest Market economy Neighborhood

Danger from drunken drivers Negative economies Negative economies

Impure public goods Quasi – public goods Quasi – public goods


Question Types of imperfect competition areCorrect Answer Monopoly , Duopoly , OligopolyYour Answer Monopoly , Duopoly , Oligopoly

Question If the output rises in the greater proportion than that of the increase in factor inputs, it isreferred to as ________.Correct Answer increasing returns to scale.Your Answer increasing returns to scale.












































Question Investment is significant becauseCorrect Answer Addition to the real capital assets , It leads to increase in level of income ,Increases accumulated wealth of the societyYour Answer Addition to the real capital assets , It leads to increase in level of income ,Increases accumulated wealth of the society

Question In the context of externalities, driving the smoke-emitting buses and trucks in the citiesis an example of ________ cost.Correct Answer socialYour Answer social

Question According to Lionel Robbins, “Economics is a science which studies Correct Answer human behaviorYour Answer economic variables behavior

Question The out of pocket costs are ________.

Correct Answer Explicit costsYour Answer Explicit costs

Question A firm gets an opportunity to produce multiple products because changes in businessactivity in a firms isCorrect Answer cyclicalYour Answer rapid

Question Market system or market economy suffers from time to time from economicdepressions.Correct Answer True

Your Answer TrueQuestion Under competitive conditions, market mechanism would automatically bringequilibrium at the level of Correct Answer full employmentYour Answer optimum produce

Question Micro-economics is primarily concerned with the problem of what, how and for whomto produce?Correct Answer FalseYour Answer True

Question Factors influencing selling costs areCorrect Answer Type of product , Introduction of new goods , Technology changesYour Answer Type of product , Introduction of new goods , Advertising by customers

Question The important determinants of supply areCorrect Answer Always referred to in relation to price & time , Government policy , Availabilityof factors of production









































Your Answer Always referred to in relation to price & time , Government policy , Availability of factors of production

Question The slope of Supply curve of labour is alwaysCorrect Answer backward

Your Answer upward

Question In economics the questions related to the dynamic or static ( otherwise) capacity of theeconomy to produce goods and services are topics in theCorrect Answer theory of economic growthYour Answer theory of economic growth

Question Features of monopolistic Competition areCorrect Answer Fairly large number of firms , Product differentiation , Selling costs are existedYour Answer Fairly large number of firms , Product differentiation , Selling costs are existed

Question Under perfect competition,firms are free to enter and exit in the market.Correct Answer TrueYour Answer True







Question Under perfect competition single seller can influence the price.Correct Answer False Your Answer False




True/FalseQuestion The damage being done by the factories at and around Agra to Taj Mahal is an exampleof social cost for private benefit.


































Multiple Choice Single AnswerQuestion The Risk theory of profit was developed by

Correct Answer HawleyYour Answer Hawley

Multiple Choice Multiple AnswerQuestion Index numbers may broadly be classified asCorrect Answer Price indices , Quantity indices , Special purpose indicesYour Answer Price indices , Quantity indices , Special purpose indices

Multiple Choice Single AnswerQuestion Expansion of supply is shown by the movement in the supply curve which isCorrect Answer upward

Your Answer upward

Multiple Choice Multiple AnswerQuestion Forms of Public EnterprisesCorrect Answer departmental management , company management or management by boards ,public corporationsYour Answer departmental management , company management or management by boards ,public corporations

Select The Blank Question The financing of ________ goods is done through public expenditure.

Correct Answer publicYour Answer public

Multiple Choice Single AnswerQuestion A Joint- Stock Company is owned by its share holders but it is managed byCorrect Answer Board of DirectorsYour Answer Board of Directors

Multiple Choice Multiple AnswerQuestion The examples of negative externalities areCorrect Answer nuclear power plants , gargantuan trucks , unsafe factories

Your Answer nuclear power plants , gargantuan trucks , unsafe factoriesMatch The FollowingQuestion Correct Answer Your Answer

Reduction in demand due to a new substitute in market Uncertainity Uncertainity

Accounting profit Explicit costs Explicit costs



Economic profit Pure profit Pure profit

Risk taking theory Hawley Hawley


Question Peas & beas, groundnut oil & til oil, tea & coffee are examples of Correct Answer substitutes goodsYour Answer complimentary goods

Select The Blank Question Output rises in a lesser proportion to that of the increase in input, under the case of ________.Correct Answer decreasing returns to scaleYour Answer decreasing returns to scale

True/False

Question A monopolist in a price maker.Correct Answer TrueYour Answer True

Select The Blank Question The chemical effluents recklessly released by a chemical factory in the river causingwater pollution, is an example of ________ cost.Correct Answer socialYour Answer environmental

True/False

Question The financing of the pure public goods has to be through public expenditure and notthrough market pricing.Correct Answer TrueYour Answer True

Multiple Choice Single AnswerQuestion A firm is a unit of production, where production is done with the aim to maximizeCorrect Answer profitsYour Answer profits

Select The Blank

Question By „ profits‟, th e economist means total revenue minus ________.Correct Answer All costsYour Answer Explicit costs

Multiple Choice Multiple AnswerQuestion Cost-Benefit Analysis isCorrect Answer The analysis undertaken to judge the investment of any project , Refers tofinding out the worth of investment , Enable ranking of optional investments



Your Answer The analysis undertaken to judge the investment of any project , Refers to findingout the worth of investment , Enable ranking of optional investments

True/FalseQuestion Giffen goods are superior goods.


Multiple Choice Multiple AnswerQuestion The railways use a lot of coal in firing the steam locomotives. This act causesCorrect Answer a lot of sufferings to the people near the railway. , cost to the society. , no cost tothe railways.Your Answer a lot of sufferings to the people near the railway. , cost to the society. , no cost tothe railways.


Question All the buyers and sellers operating under perfect competition have knowledgeCorrect Answer perfectYour Answer perfect

Multiple Choice Multiple AnswerQuestion Marginal cost pricing explains that theCorrect Answer Price charged should be equal to the marginal cost , Cost price sets the lowerlimi ts for firm‟s price , Cost price ensures the possible level of profitability Your Answer Price charged should be equal to the marginal cost , Cost price sets the lower limitsfor firm‟s price , Cost price ensures the possible level of profitability

True/FalseQuestion The question regarding the nature and quantities of commodities to be produced issolely restricted to capitalist economies.Correct Answer FalseYour Answer False


Implicit costs are the cost of resources owned by the firm. of resources owned by the firm.

Opportunity costs are also known as alternative costs alternative costsThe difference between average total cost &average fixed cost shows variable cost variable cost

The difference between average cost and average revenue is average profit average profit

True/FalseQuestion During the period of depression, a large part of a country‟s resources lie involuntarily



idle.Correct Answer TrueYour Answer True


Question The demand curve (A.R.) of a firm under perfect competition isCorrect Answer perfectly elasticYour Answer perfectly elastic

Select The Blank Question The externality which causes an economic gain or an economic loss to other economicunits is also referred to as ________ externality.Correct Answer PecuniaryYour Answer Pecuniary

Select The Blank

Question While discussing the product divisibility of public and private goods, the principle of ________ may be applied in case of only those people who do not agree to pay or who cannotpay the market priceCorrect Answer exclusionYour Answer exclusion

Select The Blank Question Under the decreasing returns to scale, the marginal output curve slopes ________.Correct Answer downwardYour Answer downward

Multiple Choice Multiple AnswerQuestion Characteristics of Pure Public goods are:Correct Answer They are completely indivisible , Their marginal cost would be zero or close tozero , Their benefits cannot be pricedYour Answer They are completely indivisible , Their marginal cost would be zero or close tozero , Their benefits cannot be priced

Multiple Choice Multiple AnswerQuestion Major types of costs areCorrect Answer Accounting costs , Economic costs , Opportunity costsYour Answer Accounting costs , Economic costs , Opportunity costs

True/FalseQuestion The short run Average Cost (A.C.) curve is U shaped.Correct Answer TrueYour Answer True

True/FalseQuestion Cyclical fluctuations are recurrent in nature




Multiple Choice Multiple AnswerQuestion Quantitative credit control measures are

Correct Answer open market operations , changes in bank rates , changes in statutory reserveratioYour Answer open market operations , changes in statutory reserve ratio

True/FalseQuestion Private profit motive is an essential feature of Capitalism.Correct Answer TrueYour Answer True

Multiple Choice Single AnswerQuestion The number of buyers & sellers operating under perfect competition is

Correct Answer largeYour Answer large

Select The Blank Question The sum of all individual demands constitutes________Correct Answer market demandYour Answer market demand

Select The Blank Question The costs which cover the cost of advertising is ________.Correct Answer Selling cost

Your Answer Selling costMultiple Choice Single AnswerQuestion The relation between variable input and ouputCorrect Answer is directYour Answer is direct

Multiple Choice Single AnswerQuestion With decline in price of a commodity, total expenditure spent on the commodity is lessthan before, then elasticity of demand for the commodity isCorrect Answer < 1

Your Answer < 1Multiple Choice Single AnswerQuestion The public sector is owned & controlled byCorrect Answer state enterprisesYour Answer state enterprises



True/FalseQuestion In the market, any one who agrees to pay the requisite price of a product would beexcluded from their consumption.Correct Answer FalseYour Answer False

Multiple Choice Single AnswerQuestion A downward movement from one point to another point on the same demand curveimpliesCorrect Answer expansionYour Answer expansion

Multiple Choice Multiple AnswerQuestion Methods of forecasting demand for new products areCorrect Answer Product life cycle analysis , Test marketing , Evolutionary approachYour Answer Product life cycle analysis , Test marketing , Evolutionary approach

True/FalseQuestion The concept of economic profit differs from that of normal profit.Correct Answer FalseYour Answer True

Select The Blank Question Reasonable profit target as an alternative to the objective of profit maximization wassuggested by ________.Correct Answer Joel DeanYour Answer Joel Dean

Multiple Choice Single AnswerQuestion Inflation is characterized by demand which is inCorrect Answer excess of supplyYour Answer surplus

Select The Blank Question Defence service is an example of ________ good.Correct Answer indivisibleYour Answer public

Managerial Economics – 23 Posted by scdlpapers on July 21st, 2010










When there is ________ in foreign demand for the goods manufactured in a country, exportsincrease and prices of commodities in the country Increase.Correct AnswerIncreaseYour Answer

Increase

Select The Blank QuestionManagerial ________ lies on the borderline of management and Economics.Correct AnswerEconomicsYour AnswerEconomics

True/False

QuestionDemand curve slopes upwards from left to right.Correct AnswerFalseYour AnswerFalse

Multiple Choice Single AnswerQuestionIf a person is habituated to the consumption of a commodity and if he cannot easily give up itsuse, demand for it is generally :-

Correct AnswerInelasticYour AnswerInelastic

Select The Blank QuestionPropensity to consume is defined as the relationship between consumption and ________.Correct AnswerIncomeYour AnswerIncome

True/FalseQuestionIn case of a proprietary firm the liability of the proprietor is limited.Correct AnswerFalse



Your AnswerFalse


Government has carried out various rounds of disinvestments of equity shareholding, realizing atotal amount of ________.Correct AnswerRs. 20,320 croresYour AnswerRs. 19,320 crores

Select The Blank QuestionIn a market system of an economy, producers are guided by ________ motive.Correct Answer

ProfitYour AnswerProfit

True/FalseQuestionDemand is related to price, time and place.Correct AnswerTrueYour AnswerFalse

Match The FollowingQuestionCorrect AnswerYour AnswerPollution control certificateGovernment actionGovernment actionAir pollutionNegative externalityMeasure to reduce externalityRadio or TV signalPositive externalityPositive externalityNegotiationPrivate ActionPerfect Competition in the market



Select The Blank QuestionCost- benefit analysis refers to the analysis undertaken to judge any project‟s ________ whether government or private and find out its worth.Correct Answer

InvestmentsYour AnswerInvestments

Multiple Choice Multiple AnswerQuestionThe entrepreneur gets Pure Profit for :-Correct AnswerUndertaking risk & uncertainty , For co-ordination & organizing production , For innovationYour AnswerUndertaking risk & uncertainty , For innovation , For generating employment

Multiple Choice Single AnswerQuestionThe demand for a commodity depends on the prices of its substitutes which are :-Correct AnswerRelativeYour AnswerRelative


Under perfect competition, if demand increases, supply being constant, the price would :-Correct AnswerRiseYour AnswerRise

True/FalseQuestionA firm is a technical unit of a given capacity of output.Correct AnswerFalseYour AnswerFalse

Multiple Choice Single AnswerQuestionWith decline in price of a commodity, total expenditure spent on the commodity is less thanbefore, then elasticity of demand for the commodity is :-Correct Answer



Less than oneYour AnswerLess than one

Select The Blank

QuestionModern economists treat social cost and benefits as ________ of private investment andproduction decisions.Correct AnswerExternalitiesYour AnswerExternalities

Multiple Choice Single AnswerQuestionWhen a firm‟s A.R. (average revenue) is greater th an A.C. (average cost), it gets a profit which is

:-Correct AnswerSuper normalYour AnswerPositive

Multiple Choice Multiple AnswerQuestionFeatures of Dumping are :-Correct AnswerIt is possible in the case of monopoly market , Selling same good at higher price in home market

and at lower price in international market , It is encouraged with a view to promote the exportsYour AnswerIt is possible in the case of monopoly market , Selling same good at higher price in home marketand at lower price in international market , It is encouraged with a view to promote the exports

Multiple Choice Single AnswerQuestionAccording to J.M. Keynes, there is inducement to invest, when the marginal efficiency of capitalis greater than :-Correct AnswerRate of interestYour AnswerRate of interest

Multiple Choice Single AnswerQuestionAccording to many economists, the root cause of economic problem is :-Correct AnswerScarcity



Your AnswerScarcity


Demand for several products like ice-cream, chocolate, bhel-puri depends on :-Correct AnswerIndividual tastesYour AnswerIndividual tastes

True/FalseQuestionIn the traditional concept of equilibrium, a firm attains the equilibrium when the firm‟s TotalRevenue (T.R.) =Total Cost (T.C.).Correct Answer


Multiple Choice Multiple AnswerQuestionThe phase of recovery denotes :-Correct AnswerMore employment opportunities , Increase in profitability , Wage rate increaseYour AnswerIncrease in profitability , Inventories decrease

True/FalseQuestionThere is no separation of ownership and management in case of a Joint Stock Company.Correct AnswerFalseYour AnswerFalse

True/FalseQuestionPure public goods must be in the hands of public sector only.Correct AnswerTrueYour AnswerTrue




The salary of the proprietor or rent on own land are the ________.Correct AnswerImplicit costYour AnswerImplicit cost

Multiple Choice Multiple AnswerQuestionDemand Curve :-Correct AnswerIs a graphical presentation , Slopes downward , Explain the relation between price and demandYour AnswerIs a graphical presentation , Slopes downward , Explain the relation between price and demand

True/FalseQuestion

The short run Average Cost (A.C.) curve is U shaped.Correct AnswerTrueYour AnswerTrue

Select The Blank QuestionSole Proprietorship is also called sole ________.Correct AnswerTradership

Your AnswerTradership

Select The Blank QuestionPerfectly elastic demand curve is ________.Correct AnswerHorizontalYour AnswerHorizontal

Select The Blank QuestionThe externality which causes an economic gain or an economic loss to other economic units isalso referred to as ________ externality.Correct AnswerPecuniaryYour AnswerPecuniary



Multiple Choice Multiple AnswerQuestionDistinction between private sector and public sector is determined on the basis of :-Correct AnswerEconomic system , Motive , Principle of pricing

Your AnswerEconomic system , Motive , Principle of pricing

Multiple Choice Single AnswerQuestionFor an economist, Tata Eng & Locomotive Company Ltd is a :-Correct AnswerFirmYour AnswerFirm

True/FalseQuestionIn any business, while formulating a profit policy, the possibility of emergence of rival firmsmust be taken into account.Correct AnswerTrueYour AnswerTrue


Government intervention is needed in free market mechanism to :-Correct AnswerProvide employment to all who willing to work at prevailing wage rate , Factors of productionwhich are optimally allocated between the various industries , Get sufficient income to meet theirbasic needs by allYour AnswerProvide employment to all who willing to work at prevailing wage rate , Factors of productionwhich are optimally allocated between the various industries , Get sufficient income to meet theirbasic needs by all

Multiple Choice Multiple AnswerQuestionDemand is determined by :-Correct AnswerPrice of the product , Relative prices of other goods , Tastes and habitsYour AnswerPrice of the product , Tastes and habits



Match The FollowingQuestionCorrect AnswerYour AnswerHuman wants

UnlimitedUnlimitedManagerial economicsDecision making and forward planningDecision making and forward planningResourcesScarceLimitedCommoditiesGoods and servicesGoods and services

Multiple Choice Multiple AnswerQuestionThe payments made out of the Gross Profit are :-Correct AnswerRemuneration to factors of production , Depreciation , Maintenance ChargesYour AnswerRemuneration to factors of production , Depreciation , Maintenance Charges


Types of income elasticity of demand :-Correct AnswerNegative income elasticity , Zero income elasticity , Unit income elasticityYour AnswerNegative income elasticity , Unit income elasticity , Neutral income elasticity

Multiple Choice Single AnswerQuestionIn general, the demand for necessaries is relatively :-Correct AnswerInelasticYour AnswerInelastic

Multiple Choice Multiple AnswerQuestionThe causes of inflation are :-Correct AnswerIncrease in public expenditure , Increase in private expenditure , Increase in foreign demand



Your AnswerIncrease in public expenditure , Increase in private expenditure , Increase in foreign demand

True/FalseQuestion

Institution of private property is not an essential feature of Capitalism.Correct AnswerFalseYour AnswerFalse

Multiple Choice Multiple AnswerQuestionIn case of defense services, all the sections of the society are equally protected and benefited.The defense services in other words is :-Correct Answer

Indivisible in character , Cannot be priced in the market , A public goodYour AnswerIndivisible in character , Cannot be priced in the market , A public good

Multiple Choice Multiple AnswerQuestionMethods of forecasting demand for new products are :-Correct AnswerProduct life cycle analysis , Test marketing , Evolutionary approachYour AnswerProduct life cycle analysis , Test marketing , Evolutionary approach

Multiple Choice Single AnswerQuestionPeas & beans, groundnut oil & til oil, tea & coffee are examples of :-Correct AnswerSubstitute goodsYour AnswerSubstitute goods

Multiple Choice Single AnswerQuestionWhen with a rise in price, the total outlay falls, or with a fall in price, the total outlay rises,elasticity of demand is :-Correct AnswerGreater than oneYour AnswerInfinite












Question Pure public goods are subject to the law of decreasing average cost, because of theCorrect Answer economies of scaleYour Answer economies of scale

Multiple Choice Multiple AnswerQuestion Features of Long – run market areCorrect Answer It is durable goods market , Supply can be increased or reduced according to thedemand , Sellers at least recover minimum price for their goodsYour Answer It is durable goods market , Supply can be increased or reduced according to thedemand , Sellers at least recover minimum price for their goods

True/FalseQuestion In case of indivisible goods, which are not priced, the decisions regarding their demandpreferences are taken through price mechanism.Correct Answer FalseYour Answer True

Multiple Choice Single AnswerQuestion A responsible factor for inflation isCorrect Answer hike in pricesYour Answer hike in prices

True/FalseQuestion A monopolist‟s product is a unique product.Correct Answer TrueYour Answer True

Multiple Choice Multiple AnswerQuestion Important theories of profits areCorrect Answer Uncertainty-bearing theory of profit , Dynamic theory of profit , Life cycletheoryYour Answer Risk taking theory , Uncertainty-bearing theory of profit , Dynamic theory of profit

Multiple Choice Multiple AnswerQuestion The promoters of a company can get incorporated by filing with the registrarof companies various documents such asCorrect Answer Memorandum of Association , Articles of Association , ProspectusYour Answer Memorandum of Association , Articles of Association

Select The Blank Question The cost which enter the accounts book of the firm are referred as ________.











































Correct Answer Accounting costYour Answer Accounting cost

Multiple Choice Single AnswerQuestion The indivisible goods whose benefits cannot be priced are called

Correct Answer Pure public goodsYour Answer Pure private goods

Select The Blank Question The partnership between private sector & government is called ________Correct Answer Joint sector enterpriseYour Answer Joint sector enterprise

Multiple Choice Single AnswerQuestion The main objective of a co- operative organization isCorrect Answer service

Your Answer service

Multiple Choice Multiple AnswerQuestion The features of business or trade cycle areCorrect Answer It is a wave like movement , These fluctuations are recurrent in nature ,Expansion and contraction in trade cycle are cumulative in effectYour Answer It is a wave like movement , These fluctuations are recurrent in nature , Expansionand contraction in trade cycle are cumulative in effect


Pollution control certificate Government action Government action

Air pollution Negative externality Measure to reduce externality

Radio or TV signal Positive externality Private Action

Negotiation Private Action Perfect Competition in the market

Multiple Choice Single AnswerQuestion The profits which must be deducted from the gross profits to arrive at net profits are

Correct Answer Monopoly ProfitsYour Answer Accounting Profit

True/FalseQuestion The products sold by different sellers under pure competition are heterogeneous.Correct Answer FalseYour Answer True






































Public Sector Life Insurance Corporation Life Insurance Corporation

Competitive Industry Homogenous Product Non capitalist in nature

Monopoly Firm One Firm One Firm

Plant Technical Unit Technical Unit

Multiple Choice Single AnswerQuestion Cournot‟ , the economists who defined the term „market‟ different from that of thetraditional sense is anCorrect Answer French economistsYour Answer German economists

Multiple Choice Single AnswerQuestion According J.B.Clark, profit is the reward paid forCorrect Answer dynamismYour Answer risk bearing

Select The Blank Question The goods become ________ only when each individual has an access to the entireamount of it and its use by the individual does not reduce its availability to others.Correct Answer indivisibleYour Answer divisible

Multiple Choice Multiple AnswerQuestion The advantage of cost-benefit analysis areCorrect Answer Maximization of social welfare , Objective measurement of the trade-off ,Maximization of difference between total benefits & total costsYour Answer Objective measurement of the trade-off , Maximization of difference between totalbenefits & total costs , Applicable only in partial equilibrium framework.

True/FalseQuestion Supply management is related to the volume ofsupply & its distribution system.Correct Answer True

Your Answer TrueMultiple Choice Multiple AnswerQuestion The important determinants of supply areCorrect Answer Always referred to in relation to price & time , Government policy , Availabilityof factors of productionYour Answer Availability of factors of production , Tastes and preferences of producer






































Multiple Choice Multiple AnswerQuestion The features of a Joint Stock-Company areCorrect Answer perpetual succession , limited liability , free transferability of sharesYour Answer perpetual succession , limited liability , free transferability of shares

Select The Blank Question If the output rises in the greater proportion than that of the increase in factor inputs, it isreferred to as ________.Correct Answer increasing returns to scale.Your Answer increasing returns to scale.

Select The Blank Question A fall in price tends the demand for goods to ________Correct Answer expandYour Answer increase

Multiple Choice Multiple AnswerQuestion Average propensity to consume is characterized as followsCorrect Answer the ratio of consumption expenditure to any particular level of income , It isfound by dividing consumption expenditure by income , It is expressed as the percentage of income consumedYour Answer the ratio of consumption expenditure to any particular level of income , It is foundby dividing consumption expenditure by income , It is expressed as the percentage of incomeconsumed

True/FalseQuestion In case of the co-operative societies supplying cheap inputs or supplying consumer

products at fair prices, a system of subsidized pricing is followed.Correct Answer TrueYour Answer True

Multiple Choice Multiple AnswerQuestion Individual Demand ScheduleCorrect Answer Is in tabular form , It shows the prices of goods , It shows the quantities of acommodity purchasedYour Answer Is in tabular form , It shows the prices of goods , It shows the quantities of acommodity purchased

Select The Blank Question Perfectly elastic demand curve is ________Correct Answer horizontalYour Answer horizontal

Multiple Choice Multiple AnswerQuestion Methods of measurement of elasticity are









































Correct Answer Percentage method , Point elasticity method , Total outlay expenditure methodYour Answer Percentage method , Point elasticity method , Unitary elastic demand method

Select The Blank Question In the context of externalities, driving the smoke-emitting buses and trucks in the cities

is an example of ________ cost.Correct Answer socialYour Answer social

True/FalseQuestion There are no real exceptions to the law of demandCorrect Answer FalseYour Answer False

True/FalseQuestion The divisible goods, whose benefits can be priced, are called pure public goods.

Correct Answer FalseYour Answer True

True/FalseQuestion In the measurement of profit, the differences in the concept of profit arise due todifferences in cost concepts.Correct Answer TrueYour Answer True

Multiple Choice Multiple AnswerQuestion Demand forecasts are necessary for

Correct Answer Fulfillment of objective of the plans , Preparation of a budget , Expansion of firmsYour Answer Fulfillment of objective of the plans , Preparation of a budget , Expansion of firms


Multiple Choice Single AnswerQuestion The economists who defined the term „market‟ different from that of the tr

aditionalsense isCorrect Answer Jevons & CournotYour Answer Marshall

Multiple Choice Single AnswerQuestion The act of manufacturing goods and services is called









































Correct Answer productionYour Answer production

True/FalseQuestion Price discrimination is possible in perfect competition


Select The Blank Question Supply is predominantly determined by ________.Correct Answer stock Your Answer demand

Select The Blank Question The social costs and benefits are the external economies and diseconomies resultingfrom the ________ activities, which are known as, “externalities”

Correct Answer firm‟s Your Answer government

True/FalseQuestion Free riders‟ is a term associated with the people who would like to have benefit of agood without sharing the cost of its supply.Correct Answer TrueYour Answer True

Multiple Choice Single AnswerQuestion Change in income of a person may result in demand for goods to

Correct Answer changeYour Answer change

Multiple Choice Single AnswerQuestion Managerial economics aims at providing guidance to the firms forCorrect Answer decision makingYour Answer decision making

Multiple Choice Single AnswerQuestion When in order to satisfy a given want , 2 or more goods are needed in combination,these goods are called

Correct Answer complimentary goodsYour Answer complimentary goods

Multiple Choice Multiple AnswerQuestion Forecasts can be made at the level of Correct Answer A firm , An industry , The nationYour Answer A firm , An industry











































Select The Blank Question Cost-benefit analysis refers to the analysis undertaken to judge any projects ________whether government or private and find out its worth.Correct Answer investmentsYour Answer investments




True/FalseQuestion During inflation, the pensioners whose income is permanently fixed, are substantiallybenefited.Correct Answer FalseYour Answer True

Multiple Choice Single AnswerQuestion During the period of depression various factors of production areCorrect Answer exhaustedYour Answer unutilized

True/FalseQuestion When demand and supply rise and fall in the same proportion, the equilibrium pricechanges.Correct Answer FalseYour Answer False

Select The Blank Question “Homeostatic Approach” as an alternative objective of firms was suggested by________.Correct Answer Prof. Kenneth BouldingYour Answer Joel Dean

Select The Blank Question The social costs and benefits are the external economies and diseconomies resultingfrom the ________ activities, which are known as, “externalities” Correct Answer firm‟s Your An swer firm‟s

Multiple Choice Single AnswerQuestion Economists call all human resources mental, physical , inherited and acquired asCorrect Answer LabourYour Answer Labour













Multiple Choice Single AnswerQuestion According to Prof. F.H. Knight, profit is a reward forCorrect Answer uncertainty bearingYour Answer risk bearing

Multiple Choice Multiple AnswerQuestion Internal Economies involvesCorrect Answer Advantages of large-scale production , Low cost of production , It availsbenefits of cheaper financeYour Answer Low cost of production , It avails benefits of cheaper finance , Availability of banking facility

Select The Blank Question Demand for safety pins is ________Correct Answer inelasticYour Answer relatively inelastic

Select The Blank Question By „ profits‟, the economist means total revenue minus ________. Correct Answer All costsYour Answer All costs

Multiple Choice Multiple AnswerQuestion Distinction between private sector and public sector is determinedCorrect Answer on the basis of economic system , on the basis of motive , on the basis of principle of pricingYour Answer on the basis of economic system , on the basis of motive , on the basis of

infrastructureSelect The Blank Question The liability of a Karta in a Joint Hindu Family Businessis ________.Correct Answer limitedYour Answer unlimited

True/FalseQuestion When a change in income has no effect upon the quantity demanded of a product, theincome elasticity of demand is zeroCorrect Answer TrueYour Answer True

Select The Blank Question The externality which causes an economic gain or an economic loss to other economicunits is also referred to as ________ externality.Correct Answer PecuniaryYour Answer Economic



True/FalseQuestion Micro-economics is primarily concerned with the problem of what, how and for whomto produce?Correct Answer FalseYour Answer True

True/FalseQuestion During period of depression various factors of production lie unutilized.Correct Answer TrueYour Answer True

True/FalseQuestion In case of sole proprietorship the owner and organization are sameCorrect Answer TrueYour Answer True

Multiple Choice Multiple AnswerQuestion Increasing Returns explainsCorrect Answer Total product increases at an increasing rate , Marginal product increasing and itis maximum , Average product is increasing but it is below MPYour Answer Total product increases at an increasing rate , Marginal product increasing and it ismaximum , Average product is increasing but it is above MP


Price leadership Oligopoly Monopoly

Surgical equipment Refusal pricing psychological & subjective approach

Intuitive pricing psychological & subjective approach selection of sample tests markets

Experimental pricing selection of sample tests markets Oligopoly

Multiple Choice Single AnswerQuestion During a period of rising prices (inflation), the goods and services areCorrect Answer scarceYour Answer scarce

Select The Blank Question The financing of ________ goods is done through public expenditure.Correct Answer publicYour Answer public

Multiple Choice Multiple AnswerQuestion Reasons for change in Demand (Increase or Decrease in Demand)



Correct Answer Change income of consumer , Change in population , Change in fashion andcustomsYour Answer Change income of consumer , Change in fashion and customs

Select The Blank

Question The form of organization which is best for self employment is ________.Correct Answer Sole traderYour Answer Joint sector enterprise

Multiple Choice Multiple AnswerQuestion Price discrimination is possible in case of Correct Answer public utilities with legal sanction , personnel services sold , geographicalbarriersYour Answer monopolistic market , personnel services sold

True/False

Question The short run Average Cost (A.C.) curve is U shaped.Correct Answer TrueYour Answer True

True/FalseQuestion Demand for luxury goods is inelasticCorrect Answer FalseYour Answer True

True/FalseQuestion Market price fluctuates very often.


Multiple Choice Single AnswerQuestion According to J.M.Keynes, the equilibrium is established at the levelCorrect Answer less than full employmentYour Answer equal to full employment


The point of effective demand is the point when A.D. = A.S. A.D. = A.S.Trade Cycle Recession Recession

Rise in costs due to an increase in factor prices a cause of inflation from supply side. a cause of inflation from supply side.



According to J. M. Keynes, there are two factors determining the investment function, namely i)the M.E.C. and ii) the rate of interest. namely i) the consumption. and ii) the rate of savings.

Multiple Choice Single AnswerQuestion Joint Stock Company is an incorporated association with a

Correct Answer perpetual successionYour Answer perpetual succession

Select The Blank Question Sole Proprietorship which is also called sole ________Correct Answer tradershipYour Answer tradership

Multiple Choice Single AnswerQuestion The market which covers capital market & all banking and non-banking institutions aretogether taken as

Correct Answer Financial MarketYour Answer Financial Market

Multiple Choice Multiple AnswerQuestion According to Keynes there are three motives for holding cash for liquidity preferenceCorrect Answer the transactions motive , the precautionary motive , the speculative motiveYour Answer the transactions motive , the precautionary motive , the speculative motive

Multiple Choice Multiple AnswerQuestion The total output of all the commodities in one country over some period, usually takenas a year is called as

Correct Answer Gross National Product , National Product , National IncomeYour Answer Gross National Product , National Product

Multiple Choice Multiple AnswerQuestion Co-operative organizations isCorrect Answer voluntary organization , managed by democratic principle , organization, whichperforms its business within the membersYour Answer voluntary organization , managed by democratic principle , non profit motiveorganization

Select The Blank

Question The indivisible goods to which the principle exclusion does not apply are called________ goods.Correct Answer pure publicYour Answer pure public

Select The Blank Question In a market system of an economy, producers are guided by ________ motive.



Correct Answer profitYour Answer profit

Multiple Choice Single AnswerQuestion Economic problem does not recognize the boundaries of caste,creed,culture Thus

economic problem is always considered as theCorrect Answer universal problemYour Answer universal problem

Multiple Choice Multiple AnswerQuestion Conditions of Price Discrimination are:Correct Answer The two markets in which the product is sold should be kept separate , Theelasticity of demand in different markets should be different , Market must be imperfectYour Answer The two markets in which the product is sold should be kept separate , Theelasticity of demand in different markets should be different , Market must be imperfect

True/FalseQuestion Pure (Net) profit contains an element of monopoly profit.Correct Answer FalseYour Answer True

Multiple Choice Multiple AnswerQuestion Accounting profit includesCorrect Answer wages , rent , interestYour Answer wages , rent , interest


Question Depreciation is the value caused by the continuous use of a capital asset, whichindicatesCorrect Answer lossYour Answer loss

Multiple Choice Multiple AnswerQuestion The railways use a lot of coal in firing the steam locomotives. This act causesCorrect Answer a lot of sufferings to the people near the railway. , cost to the society. , no cost tothe railways.Your Answer a lot of sufferings to the people near the railway. , affects the railways

Multiple Choice Single AnswerQuestion J.M. Keynes, on the basis of a fundamental psychological law of consumption,observed that as income increases, consumption also increases, but proportionatelyCorrect Answer lessYour Answer less

Multiple Choice Single AnswerQuestion Slope of supply curve is



Correct Answer positiveYour Answer positive

Multiple Choice Multiple AnswerQuestion Types of imperfect competition are

Correct Answer Monopoly , Duopoly , OligopolyYour Answer Monopoly , Duopoly , Oligopoly

Multiple Choice Single AnswerQuestion In the Long run perfect competition and monopolistic competition the firm makeprofits which areCorrect Answer normalYour Answer normal




Multiple Choice Single AnswerQuestion In cost – benefit analysis, after the step of appraisal and selection of the project is thestep of Correct Answer comparison of the cash flowYour Answer comparison of the cash flow

Select The Blank Question In the context of formulating an investment project, ________ feasibility means theavailability of supervisors for implementing and running the project smoothly and professionally.Correct Answer managementYour Answer management

True/FalseQuestion The externalities that may be an economic gain or economic losses to other economicunits are referred to as technological externalities.Correct Answer FalseYour Answer False

Select The Blank Question The minimum number of directors which private limited should have is ________.Correct Answer 2Your Answer 3

Multiple Choice Multiple AnswerQuestion Co-operative organizations isCorrect Answer voluntary organization , managed by democratic principle , organization, which








performs its business within the membersYour Answer voluntary organization , managed by democratic principle , organization, whichperforms its business within the members


Question Main aims of the New Industrial Policy (1991) areCorrect Answer To unshackle the indian industrial economy from the cobwebs of unnecessarybureaucratic control , To introduce liberalization with a view to integrate the indian economywith the world economy , To remove restrictions on direct foreign investment as also to free thedomestic entrepreneur from the restriction of MRTP actYour Answer To unshackle the indian industrial economy from the cobwebs of unnecessarybureaucratic control , To introduce liberalization with a view to integrate the indian economywith the world economy , To remove restrictions on direct foreign investment as also to free thedomestic entrepreneur from the restriction of MRTP act


Question Quantitative credit control measures areCorrect Answer open market operations , changes in bank rates , changes in statutory reserveratioYour Answer open market operations , changes in bank rates , changes in statutory reserve ratio

Multiple Choice Single AnswerQuestion The principle of full employment equilibrium was stated byCorrect Answer Say‟s Law of Market Your Answer Say‟s Law of Market

Select The Blank

Question Increase in consumer‟s income leads in the demand for inferior goods to ________ Correct Answer decreaseYour Answer decrease

True/FalseQuestion The congress government led by Narsimha Rao announced the New Industrial Policyin July 1991.Correct Answer TrueYour Answer True

Select The Blank Question The index numbers which measure the changes in the general price level of a countryrefers to ________Correct Answer Wholesale prices indexYour Answer Wholesale prices index

Multiple Choice Single AnswerQuestion Peas & beas, groundnut oil & til oil, tea & coffee are examples of



Correct Answer substitutes goodsYour Answer substitutes goods

Multiple Choice Multiple AnswerQuestion Exceptions to the Law of Demand are

Correct Answer Giffen goods , Articles of snob appeal , SpeculationYour Answer Giffen goods , Articles of snob appeal , Speculation

Multiple Choice Single AnswerQuestion Variable cost are those costs which vary with the level of Correct Answer outputYour Answer output

Multiple Choice Single AnswerQuestion Costs which increase because of the expansion of a firm are calledCorrect Answer incremental

Your Answer incremental

Multiple Choice Single AnswerQuestion Managerial economics is also understood to refer toCorrect Answer applied economicsYour Answer applied economics

Multiple Choice Single AnswerQuestion The suggestion of reasonable profit target as an alternative to the objective of profitmaximization is byCorrect Answer Joel Dean

Your Answer Joel DeanMultiple Choice Multiple AnswerQuestion Different types of business organizations areCorrect Answer private sector , public sector , joint sectorYour Answer public sector , joint sector , private sector

Select The Blank Question Defence service is an example of ________ good.Correct Answer indivisibleYour Answer indivisible

Multiple Choice Multiple AnswerQuestion The advantage of cost-benefit analysis areCorrect Answer Maximization of social welfare , Objective measurement of the trade-off ,Maximization of difference between total benefits & total costsYour Answer Maximization of social welfare , Objective measurement of the trade-off ,Maximization of difference between total benefits & total costs



Multiple Choice Single AnswerQuestion The income which a businessman might expect from the second best alternative use of his resources is called asCorrect Answer opportunity costYour Answer opportunity cost







Multiple Choice Single AnswerQuestion The type economic problem isCorrect Answer universalYour Answer universal

True/FalseQuestion The defence services are indivisible in the sense that they cannot be priced in the

market in order to deprive some members of the society from its use or benefits.Correct Answer TrueYour Answer True

Select The Blank Question The good becomes ________ so far as its use is concerned only when it is priced in themarket and the principle of exclusion is applied to it.Correct Answer divisibleYour Answer divisible

Select The Blank

Question Output rises in a lesser proportion to that of the increase in input, under the case of ________.Correct Answer decreasing returns to scaleYour Answer decreasing returns to scale

True/FalseQuestion The law of supply is not hypothetical.




True/FalseQuestion In a free-enterprise economy, the problems of what how and for whom are solved by a

planning committeeCorrect Answer FalseYour Answer False

Multiple Choice Single AnswerQuestion Dalal Street in Bombay is known asCorrect Answer Bombay Stock ExchangeYour Answer Bombay Stock Exchange

True/FalseQuestion Accounting profit takes in to account opportunity cost.


Multiple Choice Multiple AnswerQuestion Types of Share capital of Joint-Stock Company areCorrect Answer registered or authorized capital , issued capital , paid-up capitalYour Answer registered or authorized capital , issued capital , paid-up capital

True/FalseQuestion A Joint Stock Company is managed by the Board of Directors elected by shareholders.Correct Answer True

Your Answer TrueTrue/FalseQuestion A plant is an economic unit which takes various decisions related to production anddistribution.Correct Answer FalseYour Answer False

Multiple Choice Single AnswerQuestion Every nation‟s resources which are use d to produce the quantities of goods and servicesthat would be required to satisfy all its citizen‟s wants are

Correct Answer insufficientYour Answer insufficient

Multiple Choice Single AnswerQuestion A firm gets an opportunity to produce multiple products because changes in businessactivity in a firms isCorrect Answer cyclicalYour Answer cyclical



Multiple Choice Multiple AnswerQuestion Major types of costs areCorrect Answer Accounting costs , Economic costs , Opportunity costsYour Answer Accounting costs , Economic costs , Opportunity costs

Multiple Choice Single AnswerQuestion Managerial economics generally refers to the integration of economic theory withbusinessCorrect Answer PracticeYour Answer Practice

Select The Blank Question The liability of a Karta in a Joint Hindu Family Business firm is ________.Correct Answer limitedYour Answer limited

Multiple Choice Multiple AnswerQuestion The production function studiesCorrect Answer Input and out put relation , Factors of production and final production ,Technology used in productionYour Answer Input and out put relation , Factors of production and final production ,Technology used in production



Select The Blank Question The necessary condition of profit maximization of a firm is that Marginal Revenue(M.R) must be equal to ________.Correct Answer Marginal cost (M.C)Your Answer Marginal cost (M.C)

Multiple Choice Multiple AnswerQuestion Managerial economics deals withCorrect Answer Integration of economic theory with business practice , Using logic of economics, mathematics & statistics , The use of economic modes of thought to analyze businesssolution



Your Answer Integration of economic theory with business practice , Using logic of economics,mathematics & statistics , The use of economic modes of thought to analyze business solution


Implicit costs are the cost of resources owned by the firm. of resources owned by the firm.

Opportunity costs are also known as alternative costs alternative costs

The difference between average total cost &average fixed cost shows variable cost variable cost

The difference between average cost and average revenue is average profit average profit

Multiple Choice Single AnswerQuestion In a market economy, a firm in the private sector basically aims at maximization of

Correct Answer money profitsYour Answer money profits

Multiple Choice Single AnswerQuestion Under pure competition, the entry & exit of firms isCorrect Answer freeYour Answer free

True/FalseQuestion A supply schedule is a graphical presentation of supply patterns.Correct Answer False

Your Answer False

« Managerial Economics – 11 Managerial Economics – 26 »



True/FalseQuestion When a firm‟s average revenue (A.R) is less than its average cost, it earns only normal profit.Correct Answer FalseYour Answer True

Multiple Choice Single AnswerQuestion The indivisible goods whose benefits cannot be priced arecalled



















Correct Answer Pure public goodsYour Answer Pure public goods

True/FalseQuestion The opportunity cost of a product is the opportunity gained

of being able to produce some other product.Correct Answer FalseYour Answer True

Select The Blank Question The indivisible goods to which the principle exclusion doesnot apply are called ________ goods.Correct Answer pure publicYour Answer private

True/False

Question Giffen goods are superior goods.Correct Answer FalseYour Answer False

Multiple Choice Multiple AnswerQuestion Defects of market system:Correct Answer Inequalities of income and wealth , Emergence of monopolies , Failure to provide full employmentYour Answer Inequalities of income and wealth , Emergence of monopolies


Question The number of sellers operating under monopolisticcompetition as compare to oligopoly isCorrect Answer largerYour Answer smaller

True/FalseQuestion The distinction between fixed costs and variable costs isrelevant in the short period only.Correct Answer TrueYour Answer True

Multiple Choice Multiple AnswerQuestion The promoters of a company can get incorporated by filingwith the registrarof companies various documents such asCorrect Answer Memorandum of Association , Articles of Association, ProspectusYour Answer Memorandum of Association , Articles of Association ,Prospectus



Multiple Choice Single AnswerQuestion The General Theory of Employment, Interest and Money in 1936was published byCorrect Answer J.M. KeynesYour Answer J.M. Keynes

Select The Blank Question Modern economists treat social cost and benefits as ________of private investment and production decisions.Correct Answer externalitiesYour Answer advantages

Multiple Choice Single AnswerQuestion The Risk Taking Theory was developed by Hawley, who was anCorrect Answer American EconomistYour Answer American Economist


Motor cars Tangible goods Alternative uses

Wants Insatiable Prescriptive in nature

Managerial Economics Prescriptive in nature Tangible goods

Resources Alternative uses The theory of distribution

Division of society‟s output of goods and services The theory of distribution Insatiable

Multiple Choice Single AnswerQuestion When input and output increase in the same proportion, thephase of returns areCorrect Answer constantYour Answer increasing

True/False

Question Demand and desire are one and the same.Correct Answer FalseYour Answer False

True/FalseQuestion The demand curve has a negative slope.Correct Answer TrueYour Answer False



Select The Blank Question “Homeostatic Approach” as an alternative objective of firms was suggested by ________.Correct Answer Prof. Kenneth BouldingYour Answer Prof. Kenneth Boulding

True/FalseQuestion Price is the, only determinant of demandCorrect Answer FalseYour Answer False

Select The Blank Question Output rises in a lesser proportion to that of the increasein input, under the case of ________.Correct Answer decreasing returns to scaleYour Answer decreasing returns to scale

Multiple Choice Single AnswerQuestion Besides private sector, the other type of businessorganization isCorrect Answer joint sectorYour Answer co-operative organizations

Multiple Choice Single AnswerQuestion Jevons‟ , the economists who defined the term „market‟ different from that of the traditional sense is anCorrect Answer English economists

Your Answer English economistsMultiple Choice Single AnswerQuestion If a person is habituated to the consumption of a commodityand if he cannot easily give up its use, demand for it is generallyCorrect Answer inelasticYour Answer unitary elastic

Multiple Choice Multiple AnswerQuestion Features of an Industry areCorrect Answer All firms dealing in the same line of business , Theownership and management of each firm is different , Is a group of firmsYour Answer All firms produce different goods , All firms dealing in thesame line of business

True/FalseQuestion Measurement of profit becomes difficult because of thedifficulty involved in the calculation of depreciation.



Multiple Choice Multiple AnswerQuestion Internal Economies involvesCorrect Answer Advantages of large-scale production , Low cost of production , It avails benefits of cheaper financeYour Answer Advantages of large-scale production , Low cost of

production , It avails benefits of cheaper finance

Multiple Choice Multiple AnswerQuestion We say that a nation faces economic problems , underfollowing conditionsCorrect Answer Man has unlimited wants or ends , The means orresources to satisfy them are limited , These resources are not specific buthave alternative usesYour Answer Man has unlimited wants or ends , The means or resources tosatisfy them are limited

Select The Blank Question In the 3rd stage of operation of the law of variableproportions, the marginal product becomes ________.Correct Answer negativeYour Answer zero

Multiple Choice Multiple AnswerQuestion Main aims of the New Industrial Policy (1991) areCorrect Answer To unshackle the indian industrial economy from thecobwebs of unnecessary bureaucratic control , To introduce liberalizationwith a view to integrate the indian economy with the world economy , To

remove restrictions on direct foreign investment as also to free thedomestic entrepreneur from the restriction of MRTP actYour Answer To unshackle the indian industrial economy from the cobwebsof unnecessary bureaucratic control , To introduce liberalization with aview to integrate the indian economy with the world economy

Multiple Choice Single AnswerQuestion The relation between variable input and ouputCorrect Answer is directYour Answer is direct

Multiple Choice Multiple AnswerQuestion Government intervention is needed in free market mechanismtoCorrect Answer To provide employment to all who willing to work atprevailing wage rate , Factors of production are optimally allocated betweenthe various industries , All will get sufficient income to meet their basicneedsYour Answer To provide employment to all who willing to work at



prevailing wage rate , Factors of production are optimally allocated betweenthe various industries

Select The Blank Question The index numbers which measure the changes in the general

price level of a country refers to ________Correct Answer Wholesale prices indexYour Answer Customer price indices

True/FalseQuestion The rise in prices is basically because of shortages of basic goods & services and a rapid growth of money supply.Correct Answer TrueYour Answer True


Question The sole proprietorship type of organization is found inCorrect Answer Agriculture, , Retail trade, , Hotel,Your Answer Agriculture, , Retail trade,

Multiple Choice Multiple AnswerQuestion According to Keynes there are three motives for holding cashfor liquidity preferenceCorrect Answer the transactions motive , the precautionary motive ,the speculative motiveYour Answer the transactions motive , the precautionary motive , thespeculative motive

Select The Blank Question Cost-benefit analysis refers to the analysis undertaken to

judge any projects ________ whether government or private and find out itsworth.Correct Answer investmentsYour Answer profits

Multiple Choice Single AnswerQuestion In the law of variable proportion, a stage is reached whenmarginal product isCorrect Answer zeroYour Answer zero

True/FalseQuestion Profit should be large enough for a plough – back forbusiness expansion.Correct Answer TrueYour Answer True



Multiple Choice Multiple AnswerQuestion Average propensity to consume is characterized as followsCorrect Answer the ratio of consumption expenditure to anyparticular level of income , It is found by dividing consumption expenditureby income , It is expressed as the percentage of income consumed

Your Answer the ratio of consumption expenditure to any particular levelof income , It is found by dividing consumption expenditure by income

Multiple Choice Single AnswerQuestion Market mechanism is characterized byCorrect Answer instabilityYour Answer stability

Select The Blank Question Supply is predominantly determined by ________.Correct Answer stock

Your Answer demand

Select The Blank Question The externality which causes an economic gain or an economicloss to other economic units is also referred to as ________ externality.Correct Answer PecuniaryYour Answer Financial



Multiple Choice Single Answer Question he externality in which the

onsumption or production levels of an economic unit affect the otherconomic units in the economy isalled :-

CorrectAnswer

echnological externality

YourAnswer

echnological externality

Select The Blank Question y „ profits‟, the economist means

otal revenue minus ________.CorrectAnswer

All costs

YourAnswer

All costs









Question he act of using goods and servicesavailable in the market to satisfywants is called :-

CorrectAnswer

Consumption

YourAnswer Consumption

True/False Question Marginal Cost (M.C.) is the rate of

hange of fixed cost.CorrectAnswer

alse

YourAnswer

alse

Select The Blank Question he factors of production are called

inputs and may be combined toyield the maximum ________.CorrectAnswer

Output

YourAnswer

Output

Multiple Choice Single Answer Question Depreciation is the value caused by

he continuous use of a capital asset,which indicates :-

CorrectAnswer

Loss

YourAnswer

Loss

True/False Question he externalities or economic

ffects, which flow from theroduction or use of the goods to

other parties or economic units, areermed as „neighborhood effects.‟

CorrectAnswer

rue

YourAnswer

alse

Multiple Choice Single Answer Question When a company raises additional

inance by borrowing from theublic for a specific period of time

at a particular rate of interest, it isalled as :-



CorrectAnswer

Debentures

YourAnswer

Redeemable Shares


Question At the level of the society, themacro economic objectives are :-CorrectAnswer

conomic stabilization ,mployment generation , Poverty

reductionYourAnswer

conomic stabilization ,mployment generation , Poverty

reductionTrue/False Question Any point on the production

ossibility curve indicates under

utilization of resources.CorrectAnswer

alse

YourAnswer

rue

Multiple Choice Multiple Answer Question Index numbers may broadly be

lassified as :-CorrectAnswer

pecial purpose indices , Priceindices , Quantity indices

YourAnswer

Price indices , Quantity indices ,pecial purpose indices

Multiple Choice Single Answer Question In case of a pure public good, its

marginal cost is :-CorrectAnswer

ero

YourAnswer

Low

Multiple Choice Single Answer Question An entrepreneur may earn high

rofits just by luck, say because of outbreak of war. This is known as :-

CorrectAnswer

Chance Profits

YourAnswer

Chance Profits

Multiple Choice Multiple Answer Question Methods of measurement of

lasticity are :-



CorrectAnswer

Percentage method , Point elasticitymethod , Total outlay expendituremethod

YourAnswer

Percentage method , Point elasticitymethod , Total outlay expenditure

methodMultiple Choice Single Answer Question he firm is an economic unit that

makes the decisions regardingmployment of :-

CorrectAnswer

actors of production

YourAnswer

actors of production

Multiple Choice Multiple Answer Question Reasons for change in Demand

(Increase or Decrease in Demand)are :-CorrectAnswer

Change income of consumer ,Change in population , Change inashion and customs

YourAnswer

Change income of consumer ,Change in population , Change inashion and customs

True/False Question A firm is a technical unit of a given

apacity of output.CorrectAnswer

alse

YourAnswer

rue

Multiple Choice Single Answer Question During the period of depression

various factors of production are :-CorrectAnswer

Unutilized

YourAnswer

xhausted

Select The Blank Question he rate of interest, according to

Keynes depends upon two factors:he liquidity preference function and_______.

CorrectAnswer

he quantity of money.

Your he supply of money



AnswerSelect The Blank Question y what methods are commodities

roduced and the consequences of hoices about ________ and the

onsequences of choice aboutroduction methods are topics inheory of Production.

CorrectAnswer

Production

YourAnswer

Production

True/False Question he demand for life saving drugs is

lastic.Correct

Answer

alse

YourAnswer

rue

Select The Blank Question he minimum number of directors

which private limited should have is_______.

CorrectAnswer

2

YourAnswer

2

Multiple Choice Single Answer Question he market which deals with all the

goods as a whole are considered as:-

CorrectAnswer

Commodity Market

YourAnswer

Commodity Market

Multiple Choice Single Answer Question In case of increase in the income,

he rich person‟s demand for goodswill be :-

CorrectAnswer

More

YourAnswer

More

Select The Blank Question he supply of agricultural goods is

_______.



CorrectAnswer

Inelastic

YourAnswer

Inelastic

Select The Blank

Question he products sold by differentsellers under pure competition are_______.

CorrectAnswer

Homogeneous

YourAnswer

Homogeneous

Select The Blank Question iscal Policy refers to variations in

_______.Correct

Answer

Levels of taxation

YourAnswer

otal supply of money

Multiple Choice Multiple Answer Question Price discrimination is possible in

ase of :-CorrectAnswer

Public utilities with legal sanction ,Personnel services sold ,Geographical barriers

YourAnswer

Monopolistic market , Publicutilities with legal sanction ,Geographical barriers

True/False Question Consumer‟s protection involves

rotection to the consumers fromunfair trade practices.

CorrectAnswer

rue

YourAnswer

rue

Multiple Choice Single Answer Question In the Long run, perfect competition

and monopolistic competition, theirm make profits which are :-

CorrectAnswer

Normal

YourAnswer

uper normal

True/False Question In case of decrease in supply, the



supply curve shifts to left side of theoriginal supply curve.

CorrectAnswer

rue

Your

Answer

alse

Multiple Choice Multiple Answer Question In case of defense services, all the

sections of the society are equallyrotected and benefited. The

defense services in other words is :-CorrectAnswer

Indivisible in character , Cannot bericed in the market , A public good

YourAnswer

Indivisible in character , Cannot bericed in the market

True/False

Question Demand for luxury goods isinelastic.CorrectAnswer

alse

YourAnswer

rue

Select The Blank Question A normal demand curve has

_______.CorrectAnswer

Negative slope

YourAnswer

Positive slope

Match The Following Question Correct

AnswerYourAnswer

Experimentalpricing

Trialanderrormethod

Multipleproducts

A.C.>A.R

Twofirms

Trialand

errormethod

Monopoly Lowcrosselasticityof demand

Singleproducts



Excesscapacity

Multipleproducts

Highcrosselasticityof demand

Select The Blank Question If there is reduction in the taxes

levied by the Government, peopleare left with ________.

CorrectAnswer

More money

YourAnswer

Has no effect on the money witheople

Select The Blank Question In a market economy ________ is

he best judge of personal interest.

CorrectAnswer Individual

YourAnswer

Individual

Multiple Choice Multiple Answer Question Under cost plus pricing :-CorrectAnswer

he price is set to cover material,labour cost , Actual costs, standardosts are included , Certainercentage of profit also included

Your

Answer

he price is set to cover material,

labour cost , Full cost is not coveredActual costs, standard costs areincluded

Multiple Choice Multiple Answer Question he criteria to be taken into account

while setting the standards for a„reasonable profit‟ are : -

CorrectAnswer

Capital Attraction , Plough Back ,Normal earnings

YourAnswer

Capital Attraction , Plough Back ,Normal earnings

Multiple Choice Multiple Answer Question Quantitative credit control measuresare :-

CorrectAnswer

Open market operations , Changesin bank rates , Changes in statutoryreserve ratio

YourAnswer

Open market operations , Changesin bank rates , Changes in statutory



reserve ratioMultiple Choice Multiple Answer Question eatures of public sector enterprises

are as follows :-Correct

Answer

It is controlled by the state ,

eparate funds to undertake theiractivity , They are accountable toublic

YourAnswer

It is controlled by the state ,eparate funds to undertake their

activity , They are accountable toublic

True/False Question Complementary goods are jointly

demanded but jointly demandedgoods may not be Complementary.

CorrectAnswer rueYourAnswer

rue

Multiple Choice Multiple Answer Question ypes of income elasticity of

demand :-CorrectAnswer

Negative income elasticity , Zeroincome elasticity , Unit incomelasticity

YourAnswer

Negative income elasticity , Zeroincome elasticity , Unit incomelasticity

True/False Question In case of a partnership firm, the

liability of a partner is limited.CorrectAnswer

alse

YourAnswer

alse

Match The Following Question Correct

Answer

Your

AnswerBreak evenpoint

T.R. =T.C.

T.R. =T.C.

Normalprofit

Implicitcost

Implicitcost

Averagevariable

Shortrun

Shortrun



cost(A.V.C.)

cost cost

Changeinsupply

Increaseanddecrease

insupply

Increaseanddecrease

insupply

Multiple Choice Single Answer Question Prof. Samuelson calls the air and

water pollution or dangers fromdrunken drivers as economies thatare :-

CorrectAnswer

Negative

YourAnswer

Large scale

Multiple Choice Multiple Answer Question he sole proprietorship type of

organization is found in :-CorrectAnswer

Agriculture , Retail trade , Hotel

YourAnswer

Agriculture , Retail trade



Multiple Choice Single AnswerQuestion Managerial economics generally refers to the integration of economic theory withbusinessCorrect Answer Practice

Multiple Choice Single AnswerQuestion Every nation‟s resources which are used to produce the quantities of goods andservices that would be requ ired to satisfy all its citizen‟s wants are Correct Answer insufficient

Multiple Choice Single AnswerQuestion Managerial economics is also understood to refer toCorrect Answer applied economics

Multiple Choice Single AnswerQuestion The type economic problem isCorrect Answer Universal








Multiple Choice Single AnswerQuestion The act of making goods and services is calledCorrect Answer production


Question The act of using goods and services to satisfy wants is calledCorrect Answer Consumption

Multiple Choice Single AnswerQuestion The things that are produced by factors of production are calledCorrect Answer Commodities

Multiple Choice Single AnswerQuestion The concept of just distribution of national product is aCorrect Answer normative

True/FalseQuestion A firm under perfect competition is a price makerCorrect Answer False

True/FalseQuestion When demand and supply rise and fall in the same proportion, the equilibrium pricechanges.Correct Answer False

True/FalseQuestion Market means a particular area where buyers and sellers meet

Correct Answer FalseMultiple Choice Single AnswerQuestion Goods which are completely divisible and to them the principle of exclusion appliesin full measure areCorrect Answer Pure private goods

Multiple Choice Single AnswerQuestion Market system of economy is characterized by consumer‟s Correct Answer sovereignty

True/FalseQuestion In case of a proprietary firm the liability of the proprietor is limitedCorrect Answer False

Multiple Choice Single AnswerQuestion Macro – economics provides an exploration to the functioning of an economy inCorrect Answer general



True/FalseQuestion The subject matter of macro – economics includes the theory of income andemployment at an individual levelCorrect Answer False

Match The FollowingQuestion Correct AnswerDual prices Two different pricesInflation Deficit financingP.D.S. Essential commoditiesR.B.I. General and selective credit control measuresThe consumers‟ Protection Act 1986 Right to information

Multiple Choice Single AnswerQuestion Depreciation is the value caused by the continuous use of a capital asset isCorrect Answer loss

True/FalseQuestion Accounting profit takes in to account opportunity cost.Correct Answer False

True/FalseQuestion According to Prof Knight, profit is the reward for uncertainty bearing.Correct Answer True

True/FalseQuestion According to J.B. Clark, profit is the reward paid to the entrepreneur for dynamism.

Correct Answer TrueMultiple Choice Single AnswerQuestion Complementary goods are demandedCorrect Answer jointly

Match The FollowingQuestion Correct AnswerCross demand is the change in the quantity demanded of a given commodity in response to theChange in the price of anothercommodity

Incase there were no changes in the quantity of food sold even when its price had fallen we

would know that Demand was entirely inelasticThe elasticity of demand for product will be higher The more available are substitutes for thatproductThe law of demand indicates Relationship between the price of a commodity and the quantityDemandedThe law of demand states When price falls demand rises



Multiple Choice Single AnswerQuestion As per the law marginal product becomes negative when total productCorrect Answer falls


Question The law of diminishing returns is applicable to agriculture provided the state of technology is given andCorrect Answer constant

Multiple Choice Single AnswerQuestion Under the system of dual prices adopted by the Government for essential goods, theweaker sections of the community are supplied those goods through fair price shops which areCorrect Answer fair

Select The Blank Question Quantitative credit control measures such as ________ operations, change in the

bank rate, and changes in the ________ ratiosCorrect Answer open marketCorrect Answer statutory reserve

Multiple Choice Single AnswerQuestion AVC is the per unit variable cost of Correct Answer production

True/FalseQuestion Given the price, if the cost of production of a commodity decreases because of theuse of improved technique of production, there will be increase in supply.

Correct Answer TrueTrue/FalseQuestion The laws of returns to scale explain the behavior of output in response to changes inscale.Correct Answer True

Multiple Choice Multiple AnswerQuestion An IndustryCorrect Answer Is a group of firms , All firms dealing in the same line of business , Theownership and management of each firm is different

Multiple Choice Multiple AnswerQuestion DumpingCorrect Answer It is possible in the case of Monopoly Market , Selling same good at higherprice in home market and lower at price in the international market , It is encourage with a viewto promote the exports



Select The Blank Question Under perfect competition, ________ is determined by the interaction of total________ and total supply in the marketCorrect Answer priceCorrect Answer demand

Multiple Choice Multiple AnswerQuestion Advantages of Cost-Benefit AnalysisCorrect Answer It aims at maximization of social welfare , In following this principle, theproblem of infinite target value does not arise , It shows the measures necessary for attainingmaximum net wealth

Multiple Choice Multiple AnswerQuestion Effective DemandCorrect Answer Determine the level of income and output in an economy , Is totalexpenditure is equal to total income in an economy , Study of aggregate demand and aggregate

supply

Select The Blank Question According to Prof. Ackley, “________ economics deals with economic affairs in thelarge it concerns the ________ of economic life”. Correct Answer macroCorrect Answer overall dimensions

Multiple Choice Multiple AnswerQuestion Different types of business organizations are;Correct Answer Private sector. , Public sector. , Joint sector.

Multiple Choice Multiple AnswerQuestion Distinction between private sector and public sector is determinedCorrect Answer On the basis of economic system , On the basis of motive , On the basis of principle of pricing

Multiple Choice Multiple AnswerQuestion Methods of Demand forecasting for new Products are:Correct Answer Product life Cycle Analysis , Test Marketing , Evolutionary ApproachMultiple Choice Multiple AnswerQuestion Index numbers may broadly be classified as:Correct Answer Price indices , Quantity Indices , Special purpose indices

Select The Blank Question Economics is a ________ , which studies human behaviour as a relationshipbetween ________ , which have alternative uses.Correct Answer scienceCorrect Answer ends and scarce means



Select The Blank Question The production function is the name given to the ________ between the rates of ________ of productive services and rate of output of a productCorrect Answer relationshipCorrect Answer input

Select The Blank Question Internal economies are those advantages of large- scale ________ , which accrue toa ________ on account of its superior techniques and managementCorrect Answer productionCorrect Answer firm

Select The Blank Question Elasticity of supply may be defined as the ratio of the percentage ________ or the________ change in quantity supplied to the percentage or proportionate change in Price.Correct Answer proportionate

Correct Answer change

Select The Blank Question Costs may be classified as : (a) ________ , including material costs, wage cost andinterest cost (b) ________ , including costs of advertising and (c) other costs, including insurancechCorrect Answer Production costsCorrect Answer Selling costs


Posted by scdlpapers on July 22nd, 2010

Multiple Choice Single Answer Question In case of a pure public good, its

marginal cost isCorrectAnswer

zero

YourAnswer

high

True/False Question During the period of depression, a large

part of a country‟s resources lieinvoluntarily idle.

CorrectAnswer

True

YourAnswer

True

Select The Blank Question Goods which are paradoxical to the law








of demand are ________CorrectAnswer

Giffen goods, ,

YourAnswer

Giffen goods, ,

True/False Question In contrast to the normative concept of ustice, efficiency and inefficiency are

positive concepts.CorrectAnswer

True

YourAnswer

False

True/False Question Pure private goods are completely

divisible and to them the principle of

exclusion applies in full measure.CorrectAnswer

True

YourAnswer

False

True/False Question Macro-economies is a policy oriented

science.CorrectAnswer

True

YourAnswer

True

Select The Blank Question On the ________ level, the summation

of maximum individual welfare doesnot automatically lead to maximumsocial welfare.

CorrectAnswer

macro

YourAnswer

macro

Multiple Choice Multiple Answer Question Equilibrium is the stage of CorrectAnswer

maximum satisfaction , balance ,stationary

YourAnswer

maximum satisfaction , balance ,stationary

Select The Blank Question In the context of formulating an

investment project, ________ feasibility



means the availability of supervisors forimplementing and running the projectsmoothly and professionally.

CorrectAnswer

management

YourAnswer management

Multiple Choice Multiple Answer Question The subject matter of Micro economics

includes the study of CorrectAnswer

an individual consumer , particularmarket for a given commodity ,operation of a firm

YourAnswer

an individual consumer , particularmarket for a given commodity ,operation of a firm

Multiple Choice Single Answer Question Economic problem does not recognizethe boundaries of caste,creed,cultureThus economic problem is alwaysconsidered as the

CorrectAnswer

universal problem

YourAnswer

universal problem

Select The Blank Question Demand for safety pins is ________CorrectAnswer

inelastic

YourAnswer

perfectly elastic

Multiple Choice Single Answer Question Supply curve shifts to the right side of

the original supply curve when, thesupply

CorrectAnswer

increases

YourAnswer

increases

Multiple Choice Multiple Answer Question The consumer protection Act includesCorrectAnswer

Protection from hazardous commodities, Right to a competitive price , Right toinformation regarding protection

YourAnswer

Protection from hazardous commodities, Right to a competitive price , Right to



information regarding protectionMatch The Following Question Correct

AnswerYourAnswer

Resource

allocation

optimum

combinationof inputs

Land

NaturalResources

Land carcity

Economicproblem

Scarcity MicroEconomics

ManagerialEconomics

inventorymanagement

inventorymanagement

Elasticityof

demand

MicroEconomics

optimumcombination

of inputsSelect The Blank Question In a market system of an economy,

producers are guided by ________motive.

CorrectAnswer

profit

YourAnswer

price

Multiple Choice Multiple Answer Question Features of the firm are

CorrectAnswer It is a business unit organized under oneownership , It is a sole proprietorship ,It is a partnership or joint stock company

YourAnswer

It is a business unit organized under oneownership , It is a sole proprietorship

Select The Blank Question The chemical effluents recklessly

released by a chemical factory in theriver causing water pollution, is anexample of ________ cost.

CorrectAnswer social

YourAnswer

environmental

Multiple Choice Multiple Answer Question Investment is significant becauseCorrectAnswer

Addition to the real capital assets , Itleads to increase in level of income ,



Increases accumulated wealth of thesociety

YourAnswer

Addition to the real capital assets , Itleads to increase in level of income

True/False

Question Price discrimination is possible inperfect competitionCorrectAnswer

False

YourAnswer

False

Select The Blank Question The index numbers which are compiled

to measure the changes in retail pricesof various commodities refers to________

CorrectAnswer Retail prices indexYourAnswer

Retail prices index

Select The Blank Question In the context of formulation of an

investment project, ________ feasibilitymeans the availability of land, plant,machinery, raw materials and technicalknow how etc.

CorrectAnswer

technical

YourAnswer

technical

Multiple Choice Single Answer Question Managerial economics is also

understood to refer toCorrectAnswer

applied economics

YourAnswer

applied economics

Multiple Choice Single Answer Question The type economic problem isCorrectAnswer

universal

YourAnswer

universal

True/False Question When price of a commodity falls, the

supply of that commodity increases.



CorrectAnswer

False

YourAnswer

True


Question The act of making goods and services iscalledCorrectAnswer

production

YourAnswer

production

Multiple Choice Single Answer Question If supply of goods and services can be

increased to correspond with everyincrease in demand, price level will tendto

CorrectAnswer be stableYourAnswer

rise

Multiple Choice Single Answer Question Complementary goods are demandedCorrectAnswer

ointly

YourAnswer

ointly

Match The Following

Question CorrectAnswer YourAnswerHumanwants

unlimited unlimited

GeneralTheory of Employment,Interest andMoney

J. M.Keynes

J. M.Keynes

Managerialeconomics

Decisionmakingandforwardplanning

Decisionmakingandforwardplanning

Resources scarce scarceCommodities goods

andservices

goodsandservices



Multiple Choice Multiple Answer Question Quantitative credit control measures areCorrectAnswer

open market operations , changes inbank rates , changes in statutory reserveratio

YourAnswer open market operations , changes inbank rates , changes in statutory reserveratio

True/False Question Inflation is characterized by excess of

demand.CorrectAnswer

True

YourAnswer

True

Select The Blank

Question The good becomes ________ so far asits use is concerned only when it ispriced in the market and the principle of exclusion is applied to it.

CorrectAnswer

divisible

YourAnswer

profitable

True/False Question Institution of private property is not an

essential feature of Capitalism.CorrectAnswer

False

YourAnswer

False

Multiple Choice Single Answer Question Firm is anCorrectAnswer

economic unit

YourAnswer

economic unit

Multiple Choice Single Answer Question The city of Ahmedabad has specialized

in the manufacture of CorrectAnswer

textiles

YourAnswer

textiles

Multiple Choice Single Answer Question When more units of a commodity are



purchased in response to decline inprice of that commodity, it is called asexpansion of

CorrectAnswer

demand

YourAnswer demand

Multiple Choice Multiple Answer Question Different types of Elasticity of Demand

areCorrectAnswer

Price elasticity of demand , Incomeelasticity of demand , Cross elasticity of demand

YourAnswer

Perfectly elastic demand


Question According to Prof. F.H. Knight, profit isa reward forCorrectAnswer

uncertainty bearing

YourAnswer

uncertainty bearing

Multiple Choice Multiple Answer Question The disinvestments of industries is

needed forCorrectAnswer

Phased privatization , Reducing deficit ,Capital support to plans

YourAnswer

Phased privatization , Reducing deficit ,Capital support to plans

Multiple Choice Multiple Answer Question Types of Share capital of Joint-Stock

Company areCorrectAnswer

registered or authorized capital , issuedcapital , paid-up capital

YourAnswer

registered or authorized capital , issuedcapital , paid-up capital

Select The Blank Question The form of organization which is best

for self employment is ________.CorrectAnswer

Sole trader

YourAnswer

Sole trader

Multiple Choice Single Answer Question Managerial economics refers to the

integration of economic theory with



businessCorrectAnswer

practices

YourAnswer

practices

Select The Blank Question The cost which enter the accounts book of the firm are referred as ________.

CorrectAnswer

Accounting cost

YourAnswer

Accounting cost

True/False Question The most significant feature of perfect

competition is the existence of anautomatic price mechanism.

CorrectAnswer TrueYourAnswer

True

Multiple Choice Single Answer Question Managerial economics generally refers

to the integration of economic theorywith business

CorrectAnswer

Practice

YourAnswer

Practice

Multiple Choice Single Answer Question Every nation‟s resources which are used

to produce the quantities of goods andservices that would be required tosatisfy all its citizen‟s wants are

CorrectAnswer

insufficient

YourAnswer

insufficient

True/False Question Under the liberalization policy,

Government added another list of nineindustries for which automatic approvalupto 74 % would be allowed

CorrectAnswer

True

YourAnswer

True

managerial economics scdl

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