manger i al economics 11

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LIST OF ATTEMPTED QUESTIONS AND ANSWERS

True/False

Question Changes in the value of money because of inflation make inventory valuation of finished products difficult.

Correct Answer True

Your Answer False

True/FalseQuestion The law of supply is not hypothetical.

Correct Answer False

Your Answer True

Multiple Choice Single Answer

Question Managerial economics is also understood to refer to

Correct Answer applied economics

Your Answer applied economics

Select The Blank

Question The costs which cover the cost of advertising is ________.

Correct Answer Selling cost

Your Answer Selling cost

Match The Following

Question Correct Answer Your Answer

Resource allocation optimum combination of inputs optimum combination of inputs

Natural Resources Land Land

Economic problem Scarcity Scarcity

Managerial Economics inventory management inventory management

Elasticity of demand Micro Economics Micro Economics

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

Correct Answer maximization

Your Answer maximization

True/FalseQuestion Supply management is related to the volume ofsupply & its distribution system.

Correct Answer True

Your Answer False

Multiple Choice Multiple Answer Question Distinction between private sector and public sector is determined

Correct Answer on the basis of economic system , on the basis of motive , on the basis of principle of pricing

Your Answer on the basis of economic system , on the basis of motive , on the basis of principle of pricing


Question Goods produced on large scale have

Correct Answer relatively elastic supply

Your Answer relatively elastic supply

Select The Blank

Question In a market economy ________ is the best judge of personal interest.Correct Answer individual

Your Answer individual


Question Jevons' , the economists who defined the term 'market' different from that of the traditional sense is an

Correct Answer English economists

Your Answer English economists

True/False

Question The externalities or economic effects, which flow from the production or use of the goods to other parties or

economic units, are termed as 'neighborhood effects.'

1



Correct Answer True

Your Answer True


Question An impressive advertisement of a commodity may result in the demand toCorrect Answer increase

Your Answer increase

Select The Blank Question The out of pocket costs are ________.Correct Answer Explicit costs

Your Answer Explicit costs

Match The Following


Managerial Economics aims at providing help in decision making by firms. providing help in decision making by firms.

Managerial Economics is applied branch of knowledge applied branch of knowledge

Managerial economics generally refers to the integration of economic theory with business practice. the integration of

economic theory with business practice.

managerial economics which explain various concepts While economics provides the tools applies these tools to the management of

business. While economics provides the tools applies these tools to the management of business.

Managerial economics lies on the borderline of management and economics the borderline of management and

economics


Question J.M. Keynes' economic analysis come under

Correct Answer macro analysis

Your Answer macro analysis


Question The type economic problem is

Correct Answer universal

Your Answer universal


Question The number of buyers & sellers operating under perfect competition is

Correct Answer large

Your Answer large

True/False

Question J.M. Keynes presumed an economic model as a short period model in his analysis.

Correct Answer True

Your Answer True

Multiple Choice Multiple Answer

Question Features of public sector enterprises

Correct Answer it is controlled by the state , separate funds to undertake their activity , they are accountable to public

Your Answer it is controlled by the state , separate funds to undertake their activity , unprofitable motive


Question The act of making goods and services is called

Correct Answer production

Your Answer production


Question In cost - benefit analysis, after the step of appraisal and selection of the project is the step of

Correct Answer comparison of the cash flow

Your Answer comparison of the cash flow


Question Conditions of Price Discrimination are:

Correct Answer The two markets in which the product is sold should be kept separate , The elasticity of demand in different

markets should be different , Market must be imperfect

2



Your Answer The two markets in which the product is sold should be kept separate , The elasticity of demand in different



Question In case of a pure public good, its marginal cost isCorrect Answer zero

Your Answer zero

Multiple Choice Single Answer Question The act of using goods and services to satisfy wants is calledCorrect Answer consumption

Your Answer consumption

Select The Blank

Question Demand for safety pins is ________ Correct Answer inelastic

Your Answer inelastic

Select The Blank

Question Negative slope means curve slopes downwards from________ Correct Answer left to left

Your Answer left to right


Question The total output of all the commodities in one country over some period, usually taken as a year is called as

Correct Answer National Product , National Income , Gross National ProductYour Answer Gross National Product , National Product


Question The sole proprietorship type of organization is found inCorrect Answer Agriculture, , Retail trade, , Hotel,

Your Answer Agriculture, , Retail trade, , Hotel,


Question The features of a partnership firm areCorrect Answer Joint Ownership , No Remuneration to the partners , Unlimited liability

Your Answer Joint Ownership , No Remuneration to the partners , Unlimited liability

Select The Blank Question Perfectly elastic demand curve is ________

Correct Answer horizontal

Your Answer horizontal

Multiple Choice Multiple Answer Question Increasing Returns explains

Correct Answer Total product increases at an increasing rate , Marginal product increasing and it is maximum , Average product

is increasing but it is below MP

Your Answer Total product increases at an increasing rate , Marginal product increasing and it is maximum , Average product

is increasing but it is above MP


Question The General Theory of Employment, Interest and Money in 1936 was published by

Correct Answer J.M. Keynes

Your Answer J.M. Keynes

Select The Blank

Question The partnership between private sector & government is called ________

Correct Answer Joint sector enterprise

Your Answer Joint sector enterprise


Question Assumptions underlying the law of Supply are

Correct 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

Select The Blank

Question The sum of all individual demands constitutes________ Correct Answer market demand

3



Your Answer individual demand


Question A place where buyers & sellers meet each other to effect a business transaction is known as

Correct Answer MarketYour Answer Market

True/False

Question A Joint Stock Company is managed by the Board of Directors elected by shareholders.Correct Answer TrueYour Answer True

True/False

Question In any business, while formulating a profit policy, the possibility of emergence of rival firms must be taken in to

accountCorrect Answer True

Your Answer False


Question Government intervention is needed in free market mechanism toCorrect Answer To 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 needs

Your Answer To provide employment to all who willing to work at prevailing wage rate , Factors of production are optimally


Multiple Choice Single Answer Question 'Output' which means supply of product depends upon the

Correct Answer cost of production

Your Answer cost of production


Question Types of income elasticity of demand

Correct Answer Negative income elasticity , Zero income elasticity , Unit income elasticity

Your Answer Negative income elasticity , Zero income elasticity , Unit income elasticity

True/False

Question When a change in income has no effect upon the quantity demanded of a product, the income elasticity of

demand is zero

Correct Answer TrueYour Answer True

Select The Blank

Question In a market system of an economy, producers are guided by ________ motive.

Correct Answer profitYour Answer profit


Question The payments made out of the Gross Profit are

Correct Answer Remuneration to factors of production , Depreciation , Maintenance ChargesYour Answer Remuneration to factors of production , Depreciation , Maintenance Charges


Question Demand for several products like ice-cream, chocolate, bhel-puri depends on

Correct Answer individual tastesYour Answer individual tastes

True/False

Question Pure private goods are completely divisible and to them the principle of exclusion applies in full measure.




Question In case of a pure public good, its marginal cost is

Correct Answer zero

Your Answer high

4



True/False

Question During the period of depression, a large part of a country’s resources lie involuntarily idle.

Correct Answer True

Your Answer True

Select The Blank

Question Goods which are paradoxical to the law of demand are ________

Correct Answer Giffen goods, ,

Your Answer Giffen goods, , True/False

Question In contrast to the normative concept of justice, efficiency and inefficiency are positive concepts.

Correct Answer True

Your Answer False

True/False


Correct Answer True

Your Answer False

True/False

Question Macro-economies is a policy oriented science.

Correct Answer True

Your Answer True

Select The Blank Question On the ________ level, the summation of maximum individual welfare does not automatically lead to

maximum social welfare.

Correct Answer macro

Your Answer macro


Question Equilibrium is the stage of

Correct Answer maximum satisfaction , balance , stationary

Your Answer maximum satisfaction , balance , stationary

Select The Blank

Question In the context of formulating an investment project, ________ feasibility means the availability of supervisors

for implementing and running the project smoothly and professionally.Correct Answer management

Your Answer management


Question The subject matter of Micro economics includes the study of Correct Answer an individual consumer , particular market for a given commodity , operation of a firm

Your Answer an individual consumer , particular market for a given commodity , operation of a firm


Question Economic problem does not recognize the boundaries of caste,creed,culture Thus economic problem is alwaysconsidered as the

Correct Answer universal problem

Your Answer universal problem

Select The Blank Question Demand for safety pins is ________

Correct Answer inelastic

Your Answer perfectly elastic

Multiple Choice Single Answer Question Supply curve shifts to the right side of the original supply curve when, the supply

Correct Answer increases

Your Answer increases

Multiple Choice Multiple Answer Question The consumer protection Act includes

Correct Answer Protection from hazardous commodities , Right to a competitive price , Right to information regarding

protection

Your Answer Protection from hazardous commodities , Right to a competitive price , Right to information regarding

protection

5



Match The Following


Resource allocation optimum combination of inputs Land

Natural Resources Land Scarcity

Economic problem Scarcity Micro Economics

Managerial Economics inventory management inventory management

Elasticity of demand Micro Economics optimum combination of inputs

Select The Blank Question In a market system of an economy, producers are guided by ________ motive.

Correct Answer profit

Your Answer price

Multiple Choice Multiple Answer Question Features of the firm are

Correct Answer It is a business unit organized under one ownership , It is a sole proprietorship , It is a partnership or joint stock

company

Your Answer It is a business unit organized under one ownership , It is a sole proprietorship

Select The Blank Question The chemical effluents recklessly released by a chemical factory in the river causing water pollution, is an

example of ________ cost.

Correct Answer social

Your Answer environmental


Question Investment is significant because

Correct 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

True/False

Question Price discrimination is possible in perfect competitionCorrect Answer False

Your Answer False

Select The Blank

Question The index numbers which are compiled to measure the changes in retail prices of various commodities refers to ________

Correct Answer Retail prices index

Your Answer Retail prices index

Select The Blank 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 technical

Your Answer technical









True/False

Question When price of a commodity falls, the supply of that commodity increases.


Your Answer True


6






Multiple Choice Single Answer Question If supply of goods and services can be increased to correspond with every increase in demand, price level will

tend to

Correct Answer be stable

Your Answer rise Multiple Choice Single Answer

Question Complementary goods are demanded

Correct Answer jointly

Your Answer jointly

Match The Following


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 forward planning

Resources scarce scarce

Commodities goods and services goods and services

Multiple Choice Multiple Answer Question Quantitative credit control measures are

Correct Answer open market operations , changes in bank rates , changes in statutory reserve ratio

Your Answer open market operations , changes in bank rates , changes in statutory reserve ratio

True/FalseQuestion Inflation is characterized by excess of demand.

Correct Answer True

Your Answer True

Select The Blank

Question The good becomes ________ so far as its use is concerned only when it is priced in the market and the principle

of exclusion is applied to it.

Correct Answer divisible

Your Answer profitable

True/False

Question Institution of private property is not an essential feature of Capitalism.


Your Answer False


Question Firm is an

Correct Answer economic unit

Your Answer economic unit


Question The city of Ahmedabad has specialized in the manufacture of

Correct Answer textiles

Your Answer textiles


Question When more units of a commodity are purchased in response to decline in price of that commodity, it is called as

expansion of

Correct Answer demandYour Answer demand


Question Different types of Elasticity of Demand are

Correct Answer Price elasticity of demand , Income elasticity of demand , Cross elasticity of demandYour Answer Perfectly elastic demand

7




Question According to Prof. F.H. Knight, profit is a reward for

Correct Answer uncertainty bearing

Your Answer uncertainty bearing


Question The disinvestments of industries is needed for

Correct Answer Phased privatization , Reducing deficit , Capital support to plansYour Answer Phased privatization , Reducing deficit , Capital support to plans


Question Types of Share capital of Joint-Stock Company are

Correct Answer registered or authorized capital , issued capital , paid-up capital

Your Answer registered or authorized capital , issued capital , paid-up capital

Select The Blank

Question The form of organization which is best for self employment is ________.

Correct Answer Sole trader

Your Answer Sole trader


Question Managerial economics refers to the integration of economic theory with business

Correct Answer practices

Your Answer practices

Select The Blank

Question The cost which enter the accounts book of the firm are referred as ________.

Correct Answer Accounting cost

Your Answer Accounting cost

True/False

Question The most significant feature of perfect competition is the existence of an automatic price mechanism.

Correct Answer True

Your Answer True


Question Managerial economics generally refers to the integration of economic theory with business

Correct Answer PracticeYour Answer Practice


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 areCorrect Answer insufficient

Your Answer insufficient

True/False

Question Under the liberalization policy, Government added another list of nine industries for which automatic approvalupto 74 % would be allowed

Correct Answer True

Your Answer True

ECO assgn :2: Parmeet



Correct Answer Practice

Your Answer Practice


Question The externalities which cannot be priced in the market with reference to the demand and supply behavior are

termed as

Correct Answer non - market external effectsYour Answer non - market external effects

True/False

Question In a market system of an economy procedures are guided by profit motive.


8




Question At the level of the society, the macro economic objectives are

Correct Answer economic stabilization , employment generation , poverty reduction

Your Answer economic stabilization , employment generation , poverty reduction

Select The Blank

Question By using cost-benefit analysis we can show the measures necessary for attaining maximum ________ and

optimal policy aiming at this goal.Correct Answer net wealthYour Answer net wealth

Select The Blank

Question The financing of ________ goods is done through public expenditure.

Correct Answer publicYour Answer public

Select The Blank

Question ________ effects are those externalities which flow from the production or use of the good to other parties or

economic units.Correct Answer Third party

Your Answer Third party

Select The Blank

Question Prof. Sam Nelson calls risks from unsafe factories or nuclear power plants as ________ economies.

Correct Answer negativeYour Answer risk

True/False

Question Micro-economics is primarily concerned with the problem of what, how and for whom to produce?Correct Answer False

Your Answer True


Question We say that a nation faces economic problems , under following conditionsCorrect Answer Man has unlimited wants or ends , The means or resources to satisfy them are limited , These resources are not

specific but have alternative uses

Your Answer Man has unlimited wants or ends , The means or resources to satisfy them are limited , These resources are not



Question Every nation, poor or rich small or great has to face basic economic problem that is

Correct Answer what commodities to produce and in what quantities? , by what methods are the commodities produced? , Is

purchasing power of money & savings constant or is it being eroded because of inflation?Your Answer what commodities to produce and in what quantities? , by what methods are the commodities produced?

True/False

Question A plant is an economic unit which takes various decisions related to production and distribution.

Correct Answer FalseYour Answer False

Select The Blank

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

Correct Answer 2Your Answer 2

Select The Blank

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



Question Economist's concept of profit is

Correct Answer Pure Profit , Economic Profit , Just ProfitYour Answer Pure Profit , Economic Profit


Question In economics, demand means desire backed by adequate

Correct Answer purchasing power Your Answer purchasing power

9



True/False

Question Giffen goods are superior goods.


Your Answer False

Select The Blank

Question Demand for a commodity depends on the relative price of its ________

Correct Answer substitute goodsYour Answer substitute goods

Select The Blank

Question An upward sloping demand curve is called ________

Correct Answer exceptional demand curve

Your Answer exceptional demand curve


Question Demand is determined by

Correct Answer Price of the product , Relative prices of other goods , Tastes and habits

Your Answer Price of the product , Relative prices of other goods , Tastes and habits


Question Demand Curve

Correct Answer Is a graphical presentation , Slopes downward , Explain the relation between price and demand

Your Answer Is a graphical presentation , Slopes downward , Explain the relation between price and demand


Question When input and output increase in the same proportion, the phase of returns are

Correct Answer constant

Your Answer constant

True/False

Question In case of decrease in supply, the supply curve shifts to left side of the original supply curve.

Correct Answer True

Your Answer True

True/False

Question A supply schedule is a graphical presentation of supply patterns.



Question Increasing Returns explains

Correct Answer Total product increases at an increasing rate , Marginal product increasing and it is maximum , Average productis increasing but it is below MP

Your Answer Total product increases at an increasing rate , Average product is increasing but it is below MP

Select The Blank

Question Supply is predominantly determined by ________.Correct Answer stock

Your Answer demand

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 scale

Your Answer decreasing returns to scale

Select The Blank

Question If the output rises in the greater proportion than that of the increase in factor inputs, it is referred to as ________.

Correct Answer increasing returns to scale.

Your Answer increasing returns to scale.

Multiple Choice Single Answer Question A place where buyers & sellers meet each other to effect a business transaction is known as

Correct Answer Market

Your Answer Market

Multiple Choice Single Answer Question Variable cost are those costs which vary with the level of

10



Correct Answer output

Your Answer output


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

Your Answer Bombay Stock Exchange

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

Your Answer True

True/False

Question Under perfect competition single seller can influence the price.Correct Answer False

Your Answer False

Match The Following


Demand curve under oligopoly iskinky kinky

Perfect competition perfectly elastic Average Revenue curve perfectly elastic Average Revenue curve

Marginal cost pricing helps the firm to become more aggressive in the market helps the firm to become more aggressive in the market

Going rate pricing emphasizes the market conditions emphasizes the market conditions


Question Features of an Industry are

Correct Answer All firms dealing in the same line of business , The ownership and management of each firm is different , Is a

group of firms

Your Answer All firms dealing in the same line of business , The ownership and management of each firm is different , Is agroup of firms


Question Features of Oligopoly Market areCorrect Answer Few sellers , Restriction to entry of new firms , Price leadership

Your Answer Few sellers , Restriction to entry of new firms , Price leadership


Question Marginal cost pricing explains that theCorrect Answer Price charged should be equal to the marginal cost , Cost price sets the lower limits 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 limits for firm’s price , It based on

full cost pricing


Question The crucial factor in determining the level of income and employment, according to Keynes is

Correct Answer effective demand

Your Answer effective demand


Question Inflation is characterized by demand which is in

Correct Answer excess of supply

Your Answer excess of supply

True/False

Question The prosperity phase is characterized by rise in the level of employment.

Correct Answer True

Your Answer True

Match The Following


Rise in costs due to an increase in factor prices a cause of inflation from supply side. a cause of inflation from supply

side.

11



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 M.E.C. and ii) the rate of interest.

The point of effective demand is the point when A.D. = A.S. A.D. = A.S.

Trade Cycle Recession Recession

Multiple Choice Single Answer Question Over the years in India the govt. expenditure isCorrect Answer increasing

Your Answer increasing


Question Under the system of dual prices adopted by the Government for essential goods, the weaker sections of thecommunity are supplied those goods through fair price shops which are

Correct Answer fair

Your Answer neo –rich

Multiple Choice Single Answer Question The government has adopted a system of dual prices in the case of

Correct Answer essential goods

Your Answer capital goods


Question Often monopolies purposely keep certain factors of production idle creating artificial scarcities of their productsas a result the prices

Correct Answer rise

Your Answer rise

True/False

Question There is considerable slush money with politicians & Government servants.

Correct Answer True

Your Answer True


Question Reasons for need of public distribution system are

Correct Answer To maintain stable price conditions , To bring an efficient management of the supply , To supply the necessary

goods to people at reasonable priceYour Answer To maintain stable price conditions , To bring an efficient management of the supply , To supply the necessary

goods to people at reasonable price

LIST OF ATTEMPTED QUESTIONS AND ANSWERSMultiple Choice Single Answer






to satisfy all its citizen’s wants are

Correct Answer insufficient














12




Question The act of using goods and services to satisfy wants is called

Correct Answer consumption



Question In economics the question related to the selection of methods with which commodities are produced is a subject

matter of

Correct Answer theory of productionYour Answer theory of production

True/False

Question Economic problem is faced by poor countrys only.


Your Answer False

Match The Following




Commodities goods and services J. M. Keynes



True/False

Question Price discrimination is possible in perfect competition


Your Answer False


Question A joint stock company is owned by its share holders but it is managed by

Correct Answer Board of Directors

Your Answer Board of Directors

True/False

Question The railways using a lot of coal in firing the steam locomotives put the residential and other areas near the loco

– shades to a lot of sufferings on account of smoke nuisance, is an example of pr

Correct Answer FalseYour Answer True

True/False

Question The registration of a partnership firm is voluntary.


True/False

Question In case of sole proprietorship the owner and organization are same.


True/False

Question The Joint- sector is a form of partnership between the private sector and the government.



Question In addition to the consumption and investment expenditure as in the original keynesian theory of employment,

the modern economists give due recognition to the government expenditure as an important faCorrect Answer Effective demand

Your Answer social


Question In Trade cycles the economic activity areCorrect Answer ups and downs

13



Your Answer ups and downs


Question Inflation is a phenomena of in which prices

Correct Answer risesYour Answer rises

True/False

Question Market system or market economy suffers from time to time from economic depressionsCorrect Answer TrueYour Answer True


Question According J.B.Clark, profit is the reward paid for

Correct Answer dynamismYour Answer dynamism

True/False

Question While calculating economic profit, only explicit costs are considered.



Question Emergence of close substitutes to the commodity in question may bring about demand to

Correct Answer decrease

Your Answer decrease


Question Change in income of a person may bring about in demand for goods.

Correct Answer changeYour Answer change


Question If a person is habituated to the consumption of a commodity and if he cannot easily give up its use, demand for

it is generallyCorrect Answer inelastic


True/FalseQuestion The demand for life saving drugs is elastic.


Your Answer False

Match The FollowingQuestion Correct Answer Your Answer

Variation in demand Changes in quantity demanded Changes in quantity demanded

Rigid demand E.D. = 0 E.D. = 0

Perfectly Elastic Demand E.D. =infinity E.D. =infinity

Unchanged total outlay E.D. = 1 E.D. = 1

Index number Statistical device Statistical device


Question The government of India follows administered price policy in respect of commodities which are vital and produced in the public sector

Correct Answer Public sector

Your Answer Free market

Multiple Choice Single Answer Question Substantial reduction in the cost of production of a firm because of the use of improved and up- to –date

machinery is an example of economy known as



True/False

14



Question Marginal Cost (M.C.) is the rate of change of fixed cost.


Your Answer False

Multiple Choice Multiple Answer Question Long –run market

Correct Answer It is durable goods market , Supply can be increased or reduced according to the demand , Sellers at least

recover minimum price for their goods

Your Answer It is durable goods market , Supply can be increased or reduced according to the demand , Sellers at leastrecover minimum price for their goods




markets should be different , Market must be imperfectYour Answer The two markets in which the product is sold should be kept separate , The elasticity of demand in different



Question Under cost plus pricingCorrect Answer The price is set to cover Material, labour cost , Actual costs, standard costs are included , Certain percentage of

profit also included

Your Answer The price is set to cover Material, labour cost , Actual costs, standard costs are included , Certain percentage of


Select The Blank Question According to Keynes, the ________ between the aggregate demand function and the aggregate supply function

can , and often does, take place at a point ________

Correct Answer equilibrium

Your Answer imbalanceCorrect Answer less than full employment

Your Answer less than full employment


Question Defects of market systemCorrect Answer Inequalities of Income and wealth , Emergence of monopolies , Failure to provide full employment

Your Answer Inequalities of Income and wealth , Emergence of monopolies , Failure to provide full employment

Multiple Choice Multiple Answer Question Features of public sector enterprises

Correct Answer It is controlled by the state. , Separate funds to undertake their activity. , They are accountable to public.

Your Answer It is controlled by the state. , Separate funds to undertake their activity. , They are accountable to public. ,

Unprofitable motive.


Question Demand curve of an individual for a commodity X is based on the following assumptions

Correct Answer Elasticity of demand for good X , Price of good X , Income of the consumer

Your Answer Elasticity of demand for good X , Price of good X


Question Different types of Elasticity of Demand are:

Correct Answer Price elasticity of demand , Income elasticity of Demand , Cross Elasticity of Demand

Your Answer Price elasticity of demand , Income elasticity of Demand , Cross Elasticity of Demand


Question Forecasts can be made at the level of

Correct Answer A firm , An Industry , The Nation

Your Answer A firm , A Consumer


Question Diseconomies of small -Scale Production includes:

Correct Answer High average cost of production in initial stages , Workers in the factory take some time to adjust with new

techniques of production. , In the initial stages production is on small scale

Your Answer High average cost of production in initial stages , Workers in the factory take some time to adjust with newtechniques of production. , In the initial stages production is on small scale


Question Determinants of supply:

Correct Answer Is always referred to in relation to price and time , The ability of a seller to supply a commodity , The seller willingness to supply a commodity

15



Your Answer Is always referred to in relation to price and time , The ability of a seller to supply a commodity , The seller

willingness to supply a commodity

Select The Blank

Question The Indian partnership Act, ________ , defines the partnership as "the relation between two or more ________ who have agreed to share profits of a business carried on by all or any one of them act

Correct Answer 1932

Your Answer 1932

Correct Answer personsYour Answer persons

Select The Blank

Question Minimum ________ persons have to come together to start a joint-stock company. Those who take initiative to

start it are called ________ .

Correct Answer sevenYour Answer seven

Correct Answer promoters

Your Answer promoters

Select The Blank Question A ________ is an undertaking by a company to repay the borrowed ________ on or before the specified date at

a particular interest rate, irrespective of profit or ;loss made by the company

Correct Answer debenture

Your Answer debenture

Correct Answer money

Your Answer money

Select The Blank

Question The joint sector is a form of ________ between the ________ and the government.

Correct Answer partnershipYour Answer partnership

Correct Answer private sector

Your Answer private sector

Select The Blank Question Other things being equal, the higher ________ of commodity, the smaller is the quantity ________ and lower

the price , larger is the quantity demanded.

Correct Answer demanded

Your Answer priceCorrect Answer price

Your Answer demanded

Select The Blank

Question The production function is the name given to the ________ between the rates of ________ of productiveservices and rate of output of a product

Correct Answer relationship

Your Answer relationship

Correct Answer input

Your Answer input

Select The Blank

Question Costs may be classified as : (a) ________ , including material costs, wage cost and interest cost (b) ________ ,

including costs of advertising and (c) other costs, including insurance ch

Correct Answer Production costsYour Answer Production costs

Correct Answer Selling costs

Your Answer Selling costs



Question The indivisible goods, whose benefits cannot be priced, and therefore, to which the principle of exclusion doesnot apply, are called

Correct Answer Pure public goods

Your Answer Pure public goods

Multiple Choice Single Answer Question In case of a pure public good, its marginal cost is

16



Correct Answer zero

Your Answer zero


Question The indivisible goods whose benefits cannot be priced are calledCorrect Answer Pure public goods


True/FalseQuestion The financing of the pure public goods has to be through public expenditure and not through market pricing.Correct Answer True

Your Answer True


Question Advantages of Cost-Benefit AnalysisCorrect Answer It aims at maximization of social welfare , In this principle, the problem of infinite target value does not arise ,

It shows the measures necessary for attaining maximum net wealth

Your Answer In this principle, the problem of infinite target value does not arise , It shows the measures necessary for

attaining maximum net wealth , It considered the effect of diminishing marginal utility of additional wealth

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 cannot pay the market price

Correct Answer exclusion

Your Answer exclusion

Select The Blank

Question The goods become ________ only when each individual has an access to the entire amount of it and its use by

the individual does not reduce its availability to others.

Correct Answer indivisibleYour Answer indivisible

Select The Blank

Question Defence service is an example of ________ good.


Select The Blank

Question In the context of formulating an investment project, ________ feasibility means the availability of supervisorsfor implementing and running the project smoothly and professionally.

Correct Answer management




Your Answer profit

True/FalseQuestion The federal government of U.S.A. does not face the basic economic problem.


Your Answer False

True/FalseQuestion In contrast to the normative concept of justice, efficiency and inefficiency are positive concepts.

Correct Answer True

Your Answer True

Multiple Choice Single Answer Question All firms producing the homogenous or similar products together make

Correct Answer an industry

Your Answer an industry

Multiple Choice Single Answer Question The suggestion of maximization of balanced growth rate as another alternative objective of a firm's profit is

suggested by

Correct Answer Prof. Morris

Your Answer Baumol

Match The Following

17




The Homeostatic theory Prof. Kenneth Boulding Baumol

Satisfying behavior Cyert R.M. and J.G. March Cyert R.M. and J.G. March

Joint – sector enterprises Hindustan Machine Tools Hindustan Machine Tools

State enterprises Public welfare Public welfare


Question The firm may be defined as

Correct Answer an independently administered business unit , centre where the decisions about what to produce how to produce

are taken , a business unit, which hires resources for productionYour Answer an independently administered business unit , centre where the decisions about what to produce how to produce

are taken , a business unit, which hires resources for production


Question 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


Select The Blank


Correct Answer Joint sector enterpriseYour Answer Joint sector enterprise

Select The Blank

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


True/False

Question Accounting profit takes in to account opportunity cost.Correct Answer False

Your Answer False

Multiple Choice Multiple Answer Question Gross Profit includes

Correct Answer remuneration for the factors of production paid by the entrepreneur , depreciation and maintenance charges , net

profit

Your Answer remuneration for the factors of production paid by the entrepreneur , depreciation and maintenance charges , net

profit


Question When with a rise in price, the total outlay falls, or with a fall in price, the total outlay rises, elasticity of demand

is

Correct Answer > 1Your Answer > 1

Match The Following


Excess supply can be defined as quantity supplied minus quantity demanded. quantity supplied minus quantity demanded.

Tea and sugar Complimentary goodsComplimentary goods

Excess demand can be defined asquantity demanded minus quantity supplied quantity demanded minus quantity supplied

Equilibrium price is the price where the quantity demanded equals quantity supplied quantity demanded equals quantity supplied

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 unity

Your Answer unity


18



Question Individual Demand Schedule

Correct Answer Is in tabular form , It shows the prices of goods , It shows the quantities of a commodity purchased

Your Answer Is in tabular form , It shows the prices of goods , It shows the quantities of a commodity purchased

Multiple Choice Multiple Answer Question Exceptions to the Law of Demand are

Correct Answer Giffen goods , Articles of snob appeal , Speculation

Your Answer Giffen goods , Articles of snob appeal , Speculation

Multiple Choice Multiple Answer Question Reasons for change in Demand (Increase or Decrease in Demand)

Correct Answer Change income of consumer , Change in population , Change in fashion and customs

Your Answer Change income of consumer , Change in population , Change in fashion and customs

Multiple Choice Single Answer Question Costs which increase because of the expansion of a firm are called

Correct Answer incremental

Your Answer incremental

True/FalseQuestion In the traditional concept of equilibrium, a firm attains the equilibrium when the firm’s Total Revenue (T.R.)

=Total Cost (T.C.).


Your Answer True

True/FalseQuestion 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 True

Your Answer True


Question The production function can be explained by

Correct Answer Law of variable proportions , Laws of returns to scale , Optimum combinations of inputs

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


Question The Laws of Returns to scale are

Correct 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

Select The Blank

Question Under the decreasing returns to scale, the marginal output curve slopes ________.

Correct Answer downwardYour Answer downward

Select The Blank


Correct Answer Accounting costYour Answer Accounting cost

Select The Blank

Question The salary of the proprietor or rent on own land are the ________.

Correct Answer Implicit costYour Answer Implicit cost


Question Under monopoly entry of new firms is

Correct Answer prohibitedYour Answer prohibited


Question The economists who defined the term 'market' different from that of the traditional sense is

Correct Answer Jevons & CournotYour Answer Jevons & Cournot


Question Under , Perfect competition, when an individual buyer increases or reduces his demand , the total market

demandCorrect Answer is not all affected

19



Your Answer is not all affected

True/False

Question When demand and supply rise and fall in the same proportion, the equilibrium price changes.


True/False

Question When a firm’s average revenue (A.R) is less than its average cost, it earns only normal profit.Correct Answer FalseYour Answer False


Question Types of imperfect competition are

Correct Answer Monopoly , Duopoly , OligopolyYour Answer Duopoly , Oligopoly



Correct Answer The two markets in which the product is sold should be kept separate , The elasticity of demand in differentmarkets should be different , Market must be imperfect




Question The principle of full employment equilibrium was stated byCorrect Answer Say's Law of Market

Your Answer Say's Law of Market

Multiple Choice Single Answer Question According to J.M. Keynes, the equilibrium between the aggregate demand function and the aggregate supply

function can, and often does take place at

Correct Answer less than full employment


True/False

Question During recession, on account of decline in investment by producers, there is decline in income and

consumption.


True/False

Question During the period of recession there is increase in incomes of wage and interest earners.



Question The causes of inflation are

Correct Answer Increase in public expenditure , Increase in private expenditure , Increase in foreign demandYour Answer Increase in public expenditure , Increase in private expenditure , Increase in foreign demand

3. LIST OF ATTEMPTED QUESTIONS AND ANSWERS – MANAGERIAL ECONOMICS

1. True/FalseQuestion Market means a particular area where buyers and sellers meet


2. Multiple Choice Single Answer

Question Costs which increase because of the expansion of a firm are called costsCorrect Answer incremental

3. Match The Following





20





4. Multiple Choice Single Answer Question All the free gifts of nature which are commonly called natural resources are known to economists as

Correct Answer Land

5. Multiple Choice Single Answer Question Joint Stock Company succession isCorrect Answer perpetual

6. True/False

Question Demand forecasts are of no use to a firm, for long term investment decision.





8. Multiple Choice Multiple Answer

Question Accounting profit includes:

Correct Answer Wages, Rent, Interest


Question According J.B.Clark, profit is the reward paid for Correct Answer Dynamism



Correct Answer Negative income elasticity, Zero income elasticity, Unit income elasticity11. Multiple Choice Single Answer



12. Select The Blank

Question Quantitative credit control measures such as ______ operations, change in the bank rate, and changes inthe_______ ratios

Correct Answer open market, statutory reserve


Question Market isCorrect Answer Place where buyers and sellers meet each other, A building where a number of shops deal in a particular

commodity, A place where transaction of goods and services is undertaken.


Question Types of Share capital of Joint-Stock company are;

Correct Answer Registered or authorized capital, Issued capital, Paid-up capital.15. Select The Blank

Question Consumer’s ________ numbers are the specialized forms of ________ indices in which only prices of those

commodities are considered which enter into the consumption of different classes of people.

Correct Answer price index, retail price

16. Select The Blank Question The public enterprises refer to enterprises which are ________ managed and ________ by the government

either central or state or local self governments.

Correct Answer owned, controlled

17. True/False

Question According to J.B. Clark, profit is the reward paid to the entrepreneur for dynamism.Correct Answer True

18. True/False

Question Public corporations are created by special acts of the parliament.

Correct Answer True

19. Select The Blank Question A private limited company can be formed with ________ members maximum excluding ________ of the

company.

Correct Answer Two to fifty, employee shareholders


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


Question Oligopoly is a type of ________ market. A ________ exists in the industry

Correct Answer Imperfect, few firms

22. Multiple Choice Single Answer Question The concept of just distribution of national product is a

21



Correct Answer Normative



Correct Answer Consumption

24. True/FalseQuestion Any point on the production possibility curve indicates under utilization of resources




Choice is fundamental to Economic behavior because Resources are scarce in relation to peoples wants Peoples wants are

unlimited

Micro-economics deals Primarily with comparative static equilibrium and positive economics partial comparative static

equilibrium and positive economics partial

The fundamental economic problem being faced multiplicity of wants of scarcity of resourcesResources are scarce in relation

to peoples wants

Society faces economic problemsPeoples wants are unlimited multiplicity of wants of scarcity of resources

If there were no scarcity by Economic goods and services it would mean that There would be no wants unsatisfied at least no left

economic wants There would be no wants unsatisfied at least no left economic wants


Question In economics the question related to the selection of methods with which commodities are produced is a subjectmatter of

Correct Answer theory of production

27. True/False

Question The demand for life saving drugs is elastic.Correct Answer False


Question Marginal cost pricing explains

Correct Answer Price charged should be equal to the marginal cost , It sets the lower limits for firm’s price , It ensures the

possible level of profitability29. Multiple Choice Single Answer

Question The study of the working and allocation of resources in the free market economies is the topic in the

Correct Answer theory of price

30. Multiple Choice Multiple Answer Question Increasing Returns explains:

Correct Answer Total Product increases at an increasing rate, Marginal Product increasing and it is maximum, Average Product

is increasing but it is below MP.


Question A tabular statement of ________ relationship is known as the ________ schedule, there are two types of demand schedules: (1) the individual demand schedule, and (ii) the market demand schedule

Correct Answer Price-quantity, demand


Question Managerial economics aims at providing help in the firms is

Correct Answer decision making33. Multiple Choice Multiple Answer

Question Profit is regarded as:

Correct Answer Income accruing to equity holders, Wages accrue to labour, Rent accrue to the owner


Question The suggestion of maximization of balanced growth rate as another alternative objective of a firm is byCorrect Answer Prof. Morris


Question The fiscal policy includes

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

36. Multiple Choice Single Answer Question Managerial economics generally refers to the integration of economic theory with business



Question Depreciation is the value caused by the continuous use of a capital asset isCorrect Answer Loss


Question The rate of interest, according to ________, depends upon two factors: (i) ________ and (ii) the quantity of

money

Correct Answer Keynes, the liquidity preference function39. Multiple Choice Single Answer

22






Question According to Keynes, the ______ between the aggregate demand function and the aggregate supply function

can, and often does, take place at a point ______ Correct Answer Equilibrium, less than full employment


Question The problem of unlimited wants and limited ________ with ________ uses has been forever confronting

mankind.Correct Answer Means, alternative


Question Keynes defined the ________ efficiency of ________ as the highest rate of return over cost expected from

producing an additional unit of a special asset.

Correct Answer Marginal, capital

43. Select The Blank Question Income elasticity of demand can be defined as the ________ of proportionate ________ in the quantity

demanded of the commodity to a given proportionate change in income of the consumer.

Correct Answer Ratio, change

44. True/FalseQuestion The most significant feature of perfect competition is the existence of an automatic price mechanism

Correct Answer True


Question A competitive industry has three basic characteristics, they are;

Correct Answer Large number of firms, Homogeneous product, Freedom or entry & exit.46. Multiple Choice Single Answer



Correct Answer Insufficient


Question Forms of Public Enterprises

Correct Answer Departmental management, Company Management or management by boards, Public Corporations

48. Select The BlankQuestion Costs, which increase because of ____ of a firm, are called incremental costs and costs, which haveto be borne whether there is expansion or not are called ______ costs.

Correct Answer Expansion, sunk

49. Select The BlankQuestion The 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 will diminish.” (F. Benham)Correct Answer Increased, marginal

50. Select The BlankQuestion The ‘fiscal policy’ refers to the variations in taxation and ______ expenditure programmes by

________ to achieve the predetermined objectives.

Correct Answer Public, government

51. Multiple Choice Multiple AnswerQuestion Recession includesCorrect Answer The demand is halted, Inc. in production of goods, Inventories piling up in stocks.

52. True/FalseQuestion When a change in income has no effect upon the quantity demanded of a product, the income

elasticity of demand is zero.

Correct Answer True.

53. True/FalseQuestion The concept of selling costs is relevant under perfect competition.Correct Answer False.



Losses A.C.> A.RA.C.> A.R

Indian Railways Monopoly Monopoly

Market period Perishable goods Perishable goods

Long Run Horizontal supply curve Horizontal supply curve

Super normal profit A.R.> A.C. A.R.> A.C.

55. Multiple Choice Single AnswerQuestion Under monopoly the demand curve slopesCorrect Answer Downward.

56. True/FalseQuestion The wage and salary earners who get fixed income in terms of money are benefited during inflation.

Correct Answer False.

57. Multiple Choice Multiple AnswerQuestion Gross Profit includes:

Correct Answer Remuneration for the Factors of Production paid by the entrepreneur, Depreciation and Maintenance charges, Net Profit.

23



58. Select the BlankQuestion Consumer’s protection involves protection from ____ trade practices for the purpose of promoting

sales and making money at the cost of the _____ and well being.

Correct Answer Unfair, consumer’s health.

59. Multiple Choice Single AnswerQuestion Gross profit is the excess of total revenue of a firm over total

Correct Answer Expenditure.60. Multiple Choice Single AnswerQuestion Slope of supply curve is

Correct Answer Positive.

61. Multiple Choice Single AnswerQuestion In the cost – benefit analysis, the first step involved is that the investor has to choose a

few project alternatives promising a rate of return which isCorrect Answer High.62. Multiple Choice Multiple AnswerQuestion The basic economic problems that are faced by various types of Economies.

Correct Answer What commodities are being produced? By what methods are these commodities produced? How is society’s

output of goods and services divided among its members?

63. Multiple Choice Multiple AnswerQuestion Long – run market

Correct Answer It is durable goods market, Supply can be increased or reduced according to the demand, Sellers at least recover minimum price for their goods.

64. Multiple Choice Multiple AnswerQuestion Features of monopolistic Competition

Correct Answer Fairly Large numbers of firms, Product differentiation, Selling costs are existed.

65. Multiple Choice Multiple AnswerQuestion Features of public sector enterprises

Correct Answer It is controlled by the state, Separate funds to undertake their activity, They are accountable to public.66. Multiple Choice Multiple AnswerQuestion Joint-Stock company is

Correct Answer A voluntary organization, Managed by Elected Board of Directors, A common seal.

67. Multiple Choice Multiple AnswerQuestion The sources of economic problems are:

Correct Answer Man has unlimited wants or ends, The means or resources to satisfy them are limited; These resources are not

specific but have alternative uses.

68. Multiple Choice Multiple AnswerQuestion Defects of market systemCorrect Answer Inequalities of Income and wealth, Emergence of monopolies, Failure to provide full employment.

69. Multiple Choice Single AnswerQuestion Goods produced on small scale of supply is

Correct Answer Inelastic

70. Multiple Choice Single AnswerQuestion As per the law marginal product becomes negative when total productCorrect Answer Falls

71. Multiple Choice Single AnswerQuestion Under monopoly entry of new firms is

Correct Answer Prohibited

72. Multiple Choice Single AnswerQuestion Economist’s concept of profit i.e. pure profit is a return over and above cost is

Correct Answer Implicit73. Match The Following


What is meant by a producer? Anyone who helps to produce goods or services Anyone who helps to produce goods or services

What is meant by a consumer? Anyone who consumes goods and services to satisfy his or her wants. Anyone who

consumes goods and services to satisfy his or her wants.

What is meant by the term commodities? The goods and services that are produced by factors of production. The goods and

services that are produced by factors of production.

What is consumption?The act of using goods and services to satisfy wants. The act of using goods and services to satisfy wants.

What is production? The act of making goods and services. The act of making goods and services.

74. True/FalseQuestion In the contraction of price index number, selection of the base year needs to be done with utmost

care.

Correct Answer True75. True/FalseQuestion In case of decrease in supply, the supply curve shifts to left side of the original supply curve.

Correct Answer True

76. True/FalseQuestion If demand falls and supply is constant the equilibrium price falls

Correct Answer True

77. True/FalseQuestion The law of variable proportion means the same thing as the laws of returns to scale.Correct Answer False

78. True/FalseQuestion Institution of private property is not an essential feature of Capitalism


79. True/FalseQuestion J.M. Keynes presumed an economic model as a short period model in his analysis

Correct Answer True80. Select the BlankQuestion Other things being equal, the higher ________ of commodity, the smaller is the quantity ________

and lower the price, larger is the quantity demanded.

Correct Answer Demand, Price.

81. Select the BlankQuestion Every nation's ________ are insufficient to produce the quantities of ________ than would be

required to satisfy all of its citizens' wants.Correct Answer Resources, Goods & Services.

24



82. Select the BlankQuestion The word _____ has different meanings to businessmen, _______, tax collectors, workers and

economists and it is often used in a loose sense that buries its real significance.

Correct Answer Profit, Accountants.

83. Select the BlankQuestion There are two factors determining the __________ functions, namely (i) __________ and (ii) the

rate of interestCorrect Answer Marginal efficiency of capital, The investment.

84. Select the BlankQuestion Minimum ________ persons have to come together to start a joint-stock company. Those who take

initiative to start it are called ________.

Correct Answer Seven, Promoters.85. Select the BlankQuestion Economic theory provides the basis for the _______ making process. There is some difference

between the generalizations based on abstraction and actual practices. Besides economic theory, mathematics & ________ help in

decision-making.

Correct Answer Decision, Statistics.

86. Select the BlankQuestion As per the International Labour Organization (ILO), ________ is a ________ association of

individuals with limited income on the basis of equal rights and responsibilities for achieving certain economic interest common to allof them.

Correct Answer Co-operation, Voluntary.

87. True/FalseQuestion Supply management is related to the volume of supply & its distribution system.

Correct Answer True

88. True/FalseQuestion To solve the unemployment problem, the level of effective demand must decrease.Correct Answer False

89. True/FalseQuestion In the traditional concept of equilibrium, a firm attains the equilibrium when the firm’s Total

Revenue (T.R.) = Total Cost (T.C.).


90. True/FalseQuestion Inflation is a great opportunity for merchants to earn more profit.

Correct Answer True91. True/FalseQuestion Under the disinvestment process, there is full transfer of ownership.

Correct Answer True

92. True/FalseQuestion Long period supply is relatively inelastic.

Correct Answer False93. True/FalseQuestion In experimental price approach the firms takes some cognizance of the demand for the product and

proceeds to fix a price by a trial – and – error method.

Correct Answer True

94. True/FalseQuestion The Keynesian theory emphasizes effective supply as a crucial factor in determining the level of

income and employment.Correct Answer False

95. True/FalseQuestion In India, the first phase of economic reforms is believed to have begun in 1985 when Vishwanath

Pratap Singh was the Prime Minister of the country.

Correct Answer False96. Select the BlankQuestion The sum of all individual demands constitutes________

Correct Answer Market demand

97. Select the BlankQuestion Economists like A.C. Harberger have shown that the cost benefit analysis can be applied to

________ analysis.

Correct Answer General equilibrium98. Select the BlankQuestion The form of organization which is best for self employment is ________.


99. Select the BlankQuestion Goods which are paradoxical to the law of demand are ________

Correct Answer Giffen goods.

100. Select the BlankQuestion On the ________ level, the summation of maximum individual welfare does not automatically leadto maximum social welfare.


101. Select the BlankQuestion Baumol has suggested as an alternative objective for profit maximization, the maximization of

________

Correct Answer sales102. Select the BlankQuestion The minimum number of directors which public limited should have is_______.

Correct Answer 3

103. Select the BlankQuestion Reasonable profit target as an alternative to the objective of profit maximization was suggested by

________.

Correct Answer Joel Dean104. Select the BlankQuestion “Homeostatic Approach” as an alternative objective of firms was suggested by _________.

Correct Answer Prof. Kenneth Boulding

105. Select the BlankQuestion 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)106. Select the BlankQuestion The out of pocket costs are ________.

Correct Answer Explicit costs

107. Multiple Choice Multiple AnswerQuestion Major types of costs are

Correct Answer Accounting costs, Economic costs, Opportunity costs.

108. Multiple Choice Multiple AnswerQuestion The consumer protection Act includesCorrect Answer Protection from hazardous commodities, Right to a competitive price, Right to information regarding protection

25



109. Multiple Choice Multiple AnswerQuestion The causes of inflation are

Correct Answer Incr. in public expenditure, Incr. in private expenditure, Incr. in foreign demand

110. Multiple Choice Multiple AnswerQuestion Demand forecasts are necessary for

Correct Answer Fulfillment of objective of the plans, Preparation of a budget, Expansion of firms

111. Multiple Choice Multiple AnswerQuestion Consumption function refers toCorrect Answer income consumption relationship, representation as c=f(y), functional relationship between two aggregates

112. Multiple Choice Multiple AnswerQuestion Preference Shares can be classified as

Correct Answer Simple Shares, Cumulative Shares, Redeemable Shares

113. Multiple Choice Multiple AnswerQuestion The total output of all the commodities in one country over some period,usually taken as a year is called asCorrect Answer Gross National Product, National Product, National Income

114. Multiple Choice Multiple AnswerQuestion The important determinants of supply are

Correct Answer Always referred to in relation to price & time, Govt policy, Availability of factors of prod.

115. Multiple Choice Multiple AnswerQuestion Marginal Propensity to consume is characterized as follows

Correct Answer It is defined as the ratio of the change in consumption to the change in income, It is rate of change in theaverage propensity to consume as income changes, It is derived by the formula mpc = change in c/change in y

116. Multiple Choice Multiple AnswerQuestion Features of stage of expansion in business cycle are

Correct Answer Rise in national output, Rise in consumer and capital expenditure, Bank advances grow rapidly

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

Correct Answer Product life cycle analysis, Test marketing, Evolutionary approach118. Multiple Choice Single AnswerQuestion There is separation of ownership and management in a

Correct Answer Joint Stock Company

119. Multiple Choice Single AnswerQuestion A firm gets an opportunity to produce multiple products because changes in

business activity in a firms is

Correct Answer cyclical

120. Multiple Choice Single AnswerQuestion J.M. Keynes' economic analysis come under Correct Answer macro analysis

121. Multiple Choice Single AnswerQuestion Inflation is a phenomena in which prices

Correct Answer rise

122. Multiple Choice Single AnswerQuestion A group of firms dealing in the same line of business are called asCorrect Answer Industry

123. Multiple Choice Single AnswerQuestion True inflation starts only after reaching the level of full

Correct Answer Employment

124. Multiple Choice Single AnswerQuestion The study of the supply side of product pricing is done under the

Correct Answer Theory of Production125. Multiple Choice Single AnswerQuestion An individual does not voluntarily agree to pay the market price for the milk.

As a result market refuses to supply him the required quantity of milk. In this example, milk is an

Correct Answer divisible good

126. Multiple Choice Single AnswerQuestion All the buyers and sellers operating under perfect competition haveknowledge which is

Correct Answer perfect

127. Multiple Choice Single AnswerQuestion Question related to the efficient production and allocation belong to the

branch of economic theory called

Correct Answer Welfare Economics128. Multiple Choice Single AnswerQuestion The economists who defined the term “market” diff. from that of the

traditional sense is

Correct Answer Jevons & Cournot



Cost benefit analysis Maximization of net wealth Free enterprise system

Macro economic policy Government Maximization of net wealth

Unplanned shocks & disturbances Free enterprise system Measure to reduce externality

Unemployment, inflation Economic evils Economic evils

130. Match The FollowingQuestion Correct Answer Your Answer

The price policy of a public enterprise should be such as To enable it to operate at the lowest cost possible and maximize

efficiency. To enable it to operate at the lowest cost possible and maximize efficiency.

A monopolist gets Abnormal profit. normal profit

In oligopoly market, price Tends to be rigid at the kink on the demand curve. Tends to be rigid at the kink on the demand

curve.

26



Under monopolistic competition, Expenditure is incurred by the firms on cross transportation. Expenditure is incurred by the

firms on cross transportation.



Paid – up capital is that part of the subscribed capital Which the public directly pay – up to the company, as part payment of the

share Which the public directly pay – up to the company, as part payment of the share

Authorized capital refers to The maximum amount which can be raised by a company by selling shares. Capital raised throughsale of bonds & debentures

Issued capital refers to that part public of the authorized capital Which is issued for subscription by dividing into shares.

Which is issued for subscription by dividing into shares.

Subscribed Capital is That part of the issued capital which is actually subscribed by the public. That part of the issued capital

which is actually subscribed by the public.

132. True/False

Question Pure public goods must be in the hands of public sector only.Correct Answer True

133. True/False

Question A monopolist in a price maker.

Correct Answer True

134. True/False

Question Cyclical fluctuations are recurrent in natureCorrect Answer True

135. True/False

Question In case of sole proprietorship the owner and organization are same

Correct Answer True136. True/False

Question The short run Average Cost (A.C.) curve is U shaped.

Correct Answer True

137. True/False

Question A plant is an economic unit which takes various decisions related to production and distribution.Correct Answer False

138. True/False

Question 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 True

139. True/False

Question In the measurement of profit, the differences in the concept of profit arise due to differences in cost concepts.

Correct Answer True

140. 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 index

141. Select the Blank


Correct Answer Joint sector enterprise142. Select the Blank

Question The externality which causes an economic gain or an economic loss to other economic units is also referred to

as ________ externality.

Correct Answer Pecuniary

143. Select the Blank Question Demand for a commodity depends on the relative price of its ________

Correct Answer substitute goods


Question The minimum number of directors which private limited should have is _________.

Correct Answer 2145. Select the Blank

Question The index numbers which are compiled to measure the changes in retail prices of various commodities refers to

________


146. Select the Blank Question A normal demand curve has ________+B299

Correct Answer negative slope


Question The law of constant returns to scale is depicted by the marginal output curve which is __.

Correct Answer Horizontal148. Select the Blank

27



Question The indivisible goods to which the principle of exclusion does not apply are called ______ goods.

Correct Answer pure public


Question Output rises in a lesser proportion to that of the increase in input, under the case of ___.

Correct Answer decreasing returns to scale150. Select the Blank



151. Multiple Choice Multiple Answer Question Marshall has classified the period of time into three headsCorrect Answer Short run, Long run, Market period


Question Various kinds of economic policies are

Correct Answer Industrial licensing policy, Commercial policy, Fiscal policy

153. Multiple Choice Multiple Answer Question Economist's concept of profit is

Correct Answer Pure Profit, Economic Profit, Just Profit



Correct Answer To maintain stable price conditions, To bring an efficient management of the supply, To supply the necessarygoods to people at reasonable price.


Question The production function can be studied in three ways or explained by

Correct Answer Law of variable proportion, Laws of return to scale, Optimum combination of inputs


Question Conditions of Price Discrimination are:Correct Answer The two markets in which the product is sold should be kept separate, The elasticity of demand in different

markets should be different, and Market must be imperfect.


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 scale


Question The main criterion of indivisibility of a good is that the good

Correct Answer Should be equally available to all the members of society, financing of the good are through public expenditure,

the principle of exclusion does not apply.159. Multiple Choice Multiple Answer

Question Assumptions of the Law of Demand are

Correct Answer No change in consumer’s income, No change in consumer’s preferences, No change in fashion

160. Multiple Choice Multiple Answer Question Different types of Elasticity of Demand are

Correct Answer Price elasticity of demand, Income elasticity of demand, Cross elasticity of demand


Question The form of market in which there is monopoly of two firms is known as

Correct Answer Duopoly162. Multiple Choice Single Answer

Question A firm is a unit of production, where production is done with the aim to maximize

Correct Answer Profits


Question In the Long run perfect competition and monopolistic competition the firm make profits which areCorrect Answer Normal


Question In economics the questions related to the division of society’s output of goods and services among its members

are topics in

Correct Answer Theory of distribution165. Multiple Choice Single Answer

Question Incorporation of government company is

Correct Answer Compulsory


Question Goods produced on large scale haveCorrect Answer Relatively elastic supply


Question In economics the questions related to the dynamic or static (otherwise) capacity of the economy to produce

goods and services are topics in the

Correct Answer Theory of economic growth168. Multiple Choice Single Answer


Correct Answer Purchasing power


Question All firms producing the homogenous or similar products together makeCorrect Answer An industry

28




Question Economists call all human resources as

Correct Answer Labor


Question Jevons', the economists who defined the term 'market' different from that of the traditional sense is anCorrect Answer English economists


Question The Keynesian Theory is

Correct Answer Demand oriented173. Multiple Choice Single Answer

Question Under the imperfect market, the market in which few firms exists is called as

Correct Answer Oligopoly



Production possibility frontier Maximization of output Maximization of output

Defence service IndivisibleIndivisible

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

Selection or implementation Step of cost benefit analysis Perfect Competition in the market

Eco assgn : Senthil

Multiple Choice Single Answer Question Managerial economics generally refers to the integration of economic theory with business










Correct Answer universalYour Answer universal



Correct Answer productionYour Answer production



Correct Answer consumptionYour Answer consumption


Question The things that are produced by factors of production are called

Correct Answer commoditiesYour Answer commodities

Match The Following







29



Match The Following


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

Resource allocation decisions in free market economy Theory of price Theory of price

Economic problem Universal Universal

Multiple Choice Single Answer Question An assembly of several machines, linked together either physically or by processes capable of producing a

given quantity of a product per day is

Correct Answer plant

Your Answer plant


Question In the cost – benefit analysis, after formulating various alternative project capacity, each of them has to be

examined in terms of its

Correct Answer feasibility

Your Answer feasibility


Question Joint Stock Company succession is

Correct Answer perpetual

Your Answer perpetual

True/False

Question In the market, any one who agrees to pay the requisite price of a product would be excluded from their

consumption



Question According to J.M. Keynes, the equilibrium between the aggregate demand function and the aggregate supplyfunction can, and often does take, place at



True/FalseQuestion The prosperity phase is characterized by rise in the national output

Correct Answer True

Your Answer True

True/FalseQuestion Inflation is a sustained and appreciable rise in prices

Correct Answer True

Your Answer True

Multiple Choice Single Answer Question Over the years in India the govt. expenditure is

Correct Answer increasing


Multiple Choice Single Answer Question Gross profit is the excess of total revenue of a firm over total

Correct Answer expenditure

Your Answer expenditure

Multiple Choice Single Answer Question Depreciation is the value caused by the continuous use of a capital asset is

Correct Answer loss

Your Answer loss

True/False

30




account.

Correct Answer True

Your Answer True



Correct Answer change

Your Answer change Multiple Choice Single Answer

Question Demand forecasting is predicting for the demand for a firm’s product in

Correct Answer future

Your Answer future

True/False

Question Demand for luxury goods is inelastic.


Your Answer False

True/False

Question Demand for food grains is inelastic but the demand for wheat is elastic.

Correct Answer True

Your Answer False

Select The Blank Question Administered ________ are normally set on the basis of cost plus a ________ margin of profit

Correct Answer prices

Your Answer prices

Correct Answer stipulatedYour Answer stipulated


Question Costs which increase because of the expansion of a firm are called costs

Correct Answer incrementalYour Answer incremental

True/False

Question Contraction of supply is traced by the downward movement on the supply curve.Correct Answer True

Your Answer True

True/False

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 True

Your Answer True



Your Answer True

Multiple Choice Multiple Answer Question In short run period

Correct Answer Supply of goods can be adjusted to the demand to some extent , Some factors can be changed , Supply and

demand determine the price

Your Answer Supply of goods can be adjusted to the demand to some extent , Some factors can be changed , Supply and


True/False

Question Average Product is calculated by dividing Total product by variable Factor Units.

Correct Answer True

Your Answer True


Question An Industry

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

firm is different

31



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

firm is different

Select The Blank

Question Under monopoly, there is ________ seller who controls the entire ________ in the marketCorrect Answer only one

Your Answer only one

Correct Answer supply

Your Answer supply Select The Blank


Correct Answer imperfect

Your Answer imperfect

Correct Answer few firmsYour Answer few firms

Select The Blank

Question Cost-benefit analysis refers to the analysis undertaken to judge any projects ________ whether government or

private and find out its ________ and facilities its comparison with other available oppor Correct Answer investments

Your Answer investments

Correct Answer worth

Your Answer worth

Multiple Choice Multiple Answer Question Effective Demand

Correct Answer Determine the level of income and output in an economy , Is total expenditure is equal to total income in an

economy , Study of aggregate demand and aggregate supply

Your Answer Study of aggregate demand and aggregate supply


Question Characteristics of Depression

Correct Answer Decrease in economic activities , The growth rate becomes negative , The level of national income declines

rapidlyYour Answer Decrease in economic activities , The growth rate becomes negative , The level of national income declines

rapidly

Select The Blank Question The statement showing the varying levels of aggregate demand prices, i.e. expected sales revenue by the

________ for the output associated with different levels of ________ , is called the aggr

Correct Answer entrepreneur

Your Answer company

Correct Answer employmentYour Answer employment


Question Causes for rise in prices in India

Correct Answer Mounting government expenditure , Deficit financing and increase in money supply , Role of black moneyYour Answer Mounting government expenditure , Deficit financing and increase in money supply , Role of black money


Question The firm may be defined as:

Correct Answer An independently administered business unit. , A center of where the decisions about what to produce how to produce are taken , A business unit, which hires resources for production.

Your Answer An independently administered business unit. , A center of where the decisions about what to produce how to

produce are taken , A business unit, which hires resources for production.


Correct Answer Giffen Goods , Articles of snob Appeal , Speculation

Your Answer Giffen Goods , Articles of snob Appeal , Speculation

Multiple Choice Multiple Answer Question Explicit costs are:

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

Your Answer Expenses made on self owned resources

Select The Blank

32



Question The 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 Answer land and minerals

Your Answer land and minerals

Correct Answer human capacityYour Answer human capacity

Select The Blank

Question The ________-taking theory was developed by the ________ . According to him, profit arises becauseconsiderable amount of risk is involved in business.

Correct Answer American economist Hawley

Your Answer risk

Correct Answer risk

Your Answer American economist Hawley

Select The Blank

Question A tabular statement of ________ relationship is known as the ________ schedule, there are two types of

demand schedules: (1) the individual demand schedule, and (ii) the market demand schedule

Correct Answer Price-quantity

Your Answer Price-quantityCorrect Answer demand

Your Answer demand

Select The Blank

Question The 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 Answer price

Your Answer price

Correct Answer price elasticity

Your Answer price elasticity

Select The Blank

Question Wholesale ________ index numbers measure the ________ in the general price level of a country.

Correct Answer Price

Your Answer PriceCorrect Answer changes

Your Answer changes

Select The Blank Question The money payment, which a firm makes to those ________ who supply labour services, raw materials,

transport services, electricity etc. are called ________ costs.

Correct Answer outsiders

Your Answer outsiders

Correct Answer explicitYour Answer explicit


Multiple Choice Multiple Answer Question The production function can be explained by



Multiple Choice Multiple Answer Question Individual Demand Schedule


Your Answer Is in tabular form , It shows the prices of goods , It shows the quantities of a commodity purchased , Shows the

relation between slope of the curve and demand


Question During the period of depression various factors of production are

Correct Answer exhausted

Your Answer underutilized

True/False

Question The law of supply is not hypothetical.


Your Answer False

Select The Blank

33



Question A normal demand curve has ________+B299


Your Answer negative slope

True/FalseQuestion Free riders' is a term associated with the people who would like to have benefit of a good without sharing the cost of its

supply.

Correct Answer True

Your Answer True

Select The Blank


Correct Answer indivisible

Your Answer indivisible

True/False

Question During period of depression various factors of production lie unutilized.

Correct Answer True

Your Answer True





Select The Blank Question The sum of all individual demands constitutes________

Correct Answer market demand

Your Answer market demand


Question The cost recorded in the books of accounts are considered as

Correct Answer explicit costs

Your Answer explicit costs


Question Like a particular street in a city , the entire city may sometimes specialize in the production of a particular commodity .

The city acquire the status of a

Correct Answer national marketYour Answer national market

Select The Blank


Correct Answer increasing returns to scale.Your Answer increasing returns to scale.




Select The Blank




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 areCorrect Answer insufficient


True/False

Question The distinction between fixed costs and variable costs is relevant in the short period only.Correct Answer True

Your Answer False


Question The fiscal policy includesCorrect Answer Formation of taxation policy , It is an instrument for economic stabilization , Monitoring of public expenditure

34



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

Match The Following








Question In a proprietory firm the business is owned, managed and controlled by

Correct Answer Proprietor

Your Answer Proprietor

True/False


Correct Answer True

Your Answer True


Question Under perfect competition, generally demand and supply act and react upon each other and determine the price which is in


Your Answer equilibrium

Select The Blank

Question In a market economy ________ is the best judge of personal interest.

Correct Answer individual

Your Answer government


Question When a company rasies additional finance by borrowing from the public for a specific period of time at a particular rate of

interest, it is called asCorrect Answer Debentures

Your Answer Debentures

True/False

Question In the Long- run, supply of goods can be adjusted to the demand and therefore supply curve is horizontal to the X-axis.Correct Answer False

Your Answer True

Select The Blank

Question A fall in price tends the demand for goods to ________ Correct Answer expand

Your Answer expand

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)


Question Consumption function refers toCorrect Answer income consumption relationship , representation as c=f(y) , functional relationship between two aggregates

Your Answer income consumption relationship , representation as c=f(y) , functional relationship between two aggregates


Question Economic problem does not recognize the boundaries of caste,creed,culture Thus economic problem is always consideredas the



Select The Blank Question Negative slope means curve slopes downwards from________

35



Correct Answer left to left

Your Answer left to right


Question Every nation, poor or rich small or great has to face basic economic problem that isCorrect Answer what commodities to produce and in what quantities? , by what methods are the commodities produced? , Is

purchasing power of money & savings constant or is it being eroded because of inflation?

Your Answer what commodities to produce and in what quantities? , by what methods are the commodities produced? , Is


Match The Following



Diamond Snob Appeal Snob Appeal



Select The Blank

Question On the ________ level, the summation of maximum individual welfare does not automatically lead to maximum social

welfare.

Correct Answer macroYour Answer macro


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 scale

Your Answer Law of Increasing Returns to Scale , Law of Constant Returns to Scale , Law of Decreasing Returns to scale


Question Managerial economics generally refers to the integration of economic theory with businessCorrect Answer Practice


True/FalseQuestion The concept of economic profit differs from that of normal profit.


Your Answer True

Multiple Choice Single Answer Question Jevons' , the economists who defined the term 'market' different from that of the traditional sense is an



Multiple Choice Single Answer Question J.M. Keynes, on the basis of a fundamental psychological law of consumption, observed that as income increases,

consumption also increases, but proportionately

Correct Answer less

Your Answer less

True/False

Question Under the New Industrial Policy, Public enterprises which are chronically sick and which are unlikely to be turned were

referred to BIFR

Correct Answer True

Your Answer True


Question According to Keynes, Effective Demand

Correct Answer Determines the level of income and output in an economy , Is total expenditure equal to total income in an

economy , Is the Study of aggregate demand and aggregate supplyYour Answer Determines the level of income and output in an economy , Is total expenditure equal to total income in an economy ,

Is the Study of aggregate demand and aggregate supply

True/False

Question Public enterprises have shown a very high rate of return of the capital investedCorrect Answer False

36



Your Answer False



Correct Answer Elasticity of demand for good x , Price of good x , Income of the consumer Your Answer Elasticity of demand for good x , Price of good x , Income of the consumer


Question The important determinants of supply areCorrect Answer Always referred to in relation to price & time , Government policy , Availability of factors of productionYour Answer Always referred to in relation to price & time , Government policy , Availability of factors of production

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 Under perfect competition, generally demand and supply act and react upon each other and determine the price


Your Answer short period

True/False

Question Long period supply is relatively inelastic.


Eco assgn :16:Mayur

Select The Blank

Question The indivisible goods to which the principle exclusion does not apply are called ________ goods.Correct Answer pure public

Your Answer pure public

True/FalseQuestion When a firm’s average revenue (A.R) is less than its average cost, it earns only normal profit.


Your Answer False

True/FalseQuestion The federal government of U.S.A. does not face the basic economic problem.


Your Answer False

True/FalseQuestion Inflation reduces the purchasing power of people's income and savings.

Correct Answer True

Your Answer True



Your Answer False

Multiple Choice Single Answer Question A technical unit of given capacity of output is


Your Answer plant

Multiple Choice Single Answer Question According to the Government, the buildup of inflationary pressure during the Nineties was attributed to

Correct Answer Higher Fiscal deficit

Your Answer Higher Fiscal deficit

Multiple Choice Single Answer Question A responsible factor for inflation is

37



Correct Answer hike in prices

Your Answer hike in prices


Question Every nation’s resources which are used to produce the quantities of goods and services that would be requiredto satisfy all its citizen’s wants are



Multiple Choice Single Answer Question According to J.M.Keynes, the equilibrium is established at the level



Multiple Choice Single Answer Question Managerial economics is also understood to refer to




Correct Answer True

Your Answer True

Select The Blank

Question By ' profits', the economist means total revenue minus ________.Correct Answer All costs

Your Answer All costs

Multiple Choice Multiple Answer Question Different types of Elasticity of Demand are

Correct Answer Price elasticity of demand , Income elasticity of demand , Cross elasticity of demand

Your Answer Price elasticity of demand , Income elasticity of demand , Cross elasticity of demand


Correct Answer zero

Your Answer zero

Select The Blank




True/False

Question If demand falls and supply is constant the equilibrium price falls.

Correct Answer True

Your Answer True

Select The Blank


Correct Answer 2

Your Answer 2



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



Question Characteristics of the phase of Depression are


rapidly

Your Answer Decrease in economic activities , The growth rate becomes negative , The level of national income declinesrapidly

Select The Blank


of exclusion is applied to it.Correct Answer divisible

38



Your Answer divisible





Question The city of Ludiana has developed a big market for Correct Answer hosieryYour Answer textiles


Question Features of Dumping are

Correct Answer It is possible in the case of monopoly market , Selling same good at higher price in home market and lower at price in international market , It is encouraged with a view to promote the exports

Your Answer It is possible in the case of monopoly market , Selling same good at higher price in home market and lower at

price in international market , It is encouraged with a view to promote the exports

Multiple Choice Multiple Answer Question Accounting profit includes

Correct Answer wages , rent , interest

Your Answer wages , rent , interest

Select The Blank

Question An upward sloping demand curve is called ________ Correct Answer exceptional demand curve


Multiple Choice Multiple Answer Question Features of Long –run market are



Your Answer It is durable goods market , Supply can be increased or reduced according to the demand , Sellers at least


Select The Blank



True/False

Question There is no separation of ownership and management in case of a Joint Stock Company


Select The Blank


private and find out its worth.Correct Answer investments


Select The Blank

Question A normal demand curve has ________+B299Correct Answer negative slope



Question J.M. Keynes stated that effective demand is determined by the interaction of the aggregate supply function andCorrect Answer aggregate demand function

Your Answer aggregate demand function





Question Baumol has pointed out three main contributions of economic theory. They are

39



Correct Answer Economic theory offers clarity to various concepts used in the business anlayses , Economic theory 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 analyasis

Your Answer Economic theory offers clarity to various concepts used in the business anlayses , Economic theory contributes

in building anlyatical model to rocognize managerial problems , Economic theory contributes to ,'a set of analytical methods' whichenhance the analytical capabilities of business analyasis


Question When input and output increase in the same proportion, the phase of returns areCorrect Answer constantYour Answer constant

Match The Following


N.G.O.S Voluntary social workVoluntary social work

Sole proprietorship Unlimited liability Unlimited liability

Preference shares Fixed rate of dividendFixed rate of dividend

Public enterprises State control State control


Question Gross Profit includesCorrect Answer remuneration for the factors of production paid by the entrepreneur , depreciation and maintenance charges , net

profit

Your Answer remuneration for the factors of production paid by the entrepreneur , depreciation and maintenance charges , net

profit


Question The subject matter of managerial economics covers two important areas namely decision-making and

Correct Answer forward Planning

Your Answer forward Planning

True/False

Question In a market system of economy, there is no harmony between individual interests and interests of the

community.Correct Answer False

Your Answer True

True/False

Question The externalities or economic effects, which flow from the production or use of the goods to other parties or economic units, are termed as 'neighborhood effects.'

Correct Answer True

Your Answer True




Your Answer unity

Match The Following



Diamond Snob Appeal Snob Appeal




Question 16. The phase of recovery denotes

Correct Answer More employment opportunities , Increase in profitability , Wage rate increaseYour Answer More employment opportunities , Increase in profitability , Wage rate increase

40







True/False

Question In experimental price approach the firms takes some cognizance of the demand for the product and proceeds to

fix a price by a trial – and – error method.Correct Answer TrueYour Answer True





Question Under competitive conditions, market mechanism would automatically bring equilibrium at the level of

Correct Answer full employmentYour Answer full employment


Multiple Choice Multiple Answer Question In case of defense services, all the sections of the society are equally protected and benefited. The defense

services in other words is

Correct Answer a public good , indivisible in character , cannot be priced in the market

Your Answer cannot be priced in the market

True/False



Your Answer False

Select The Blank

Question Perfectly elastic demand curve is ________



Question The indivisible goods whose benefits cannot be priced are called

Correct Answer Pure public goodsYour Answer Pure public goods

True/False

Question The wage and salary earners who get fixed income in terms of money are benefited during inflation.


Match The Following


Cost benefit analysis Maximization of net wealth Maximization of net wealth

Macro economic policy Government Government

Unplanned shocks & disturbances Free enterprise system Economic evils

Unemployment, inflation Economic evils Externality tax

Multiple Choice Multiple Answer Question The term externalities may also be referred as:

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

Your Answer Spill-over effects , Neighborhood effects , Third party effects

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

41






Question The examples of negative externalities areCorrect Answer nuclear power plants , gargantuan trucks , unsafe factories

Your Answer nuclear power plants , unsafe factories

True/FalseQuestion Inflation reduces the purchasing power of people's income and savings.Correct Answer True

Your Answer False


Question According to Keynes, Aggregate supply function refers toCorrect Answer the minimum price of revenue which the entrepreneurs must get , Associated with different levels of

employment , Explains that the level of out put varies with the level of employment

Your Answer explains how to minimize the cost of production

Multiple Choice Single Answer Question Substantial reduction in the cost of production of a firm because of the use of improved and up- to –date




Multiple Choice Multiple Answer Question The total output of all the commodities in one country over some period, usually taken as a year is called as

Correct Answer Gross National Product , National Product , National Income

Your Answer Gross National Product

Select The Blank



Correct Answer divisible




Correct Answer The cost of production is unchanged , No change in technique of production , Government policies areunchanged

Your Answer The cost of production is unchanged , No change in technique of production , Government policies are

unchanged

Select The Blank Question Increase in consumer’s income leads in the demand for inferior goods to ________



Multiple Choice Single Answer Question Market mechanism is characterized by

Correct Answer instability

Your Answer instability

Multiple Choice Single Answer Question True inflation starts only after reaching the level of full


Your Answer Employment

Multiple Choice Single Answer Question Every nation’s resources which are used to produce the quantities of goods and services that would be required




True/False


Correct Answer True

Your Answer True


42



Question Government intervention is needed in free market mechanism to

Correct Answer To provide employment to all who willing to work at prevailing wage rate , Factors of production are optimally


Your Answer Control the market mechanism by charging license fees, commissions, etc

True/False

Question 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.


Select The Blank

Question Cost-Benefit analysis aims at ________ of social wealth.






are taken , a business unit, which hires resources for productionYour Answer an independently administered business unit , centre where the decisions about what to produce how to produce



Question Goods which are completely divisible and to them the principle of exclusion applies in full measure, are called

Correct Answer Pure public goodsYour Answer Pure private goods

Match The Following





Resources scarce goods and services

Commodities goods and services scarce

Select The Blank

Question Reasonable profit target as an alternative to the objective of profit maximization was suggested by ________.Correct Answer Joel Dean

Your Answer Baumol



Your Answer particular market for a given commodity

True/False

Question A monopolist can decide both price and the quantity of a product that he is going produce and sell in the market.Correct Answer True

Your Answer True


Question For an economist, Tata Eng & Locomotive Company Ltd is aCorrect Answer firm

Your Answer firm

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 index

Your Answer Commodity prices index


Question When input and output increase in the same proportion, the phase of returns areCorrect Answer constant

43




True/False



Select The Blank

Question In a market system of an economy, producers are guided by ________ motive.Correct Answer profitYour Answer profit



Correct Answer Addition to the real capital assets , It leads to increase in level of income , Increases accumulated wealth of thesociety

Your Answer Addition to the real capital assets , Increases accumulated wealth of the society





Question The market which deals with the all the goods as a whole are considered as

Correct Answer Commodity MarketYour Answer Commodity Market


Question The type economic problem isCorrect Answer universal


True/False

Question In the market, any one who agrees to pay the requisite price of a product would be excluded from their consumption.


Your Answer False



Correct Answer Monopoly , Duopoly , Oligopoly

Your Answer Duopoly , Oligopoly





True/False

Question The supply curve slopes downwards from left to right.


Your Answer False

Select The Blank




Select The Blank




True/False

Question During the phase of depression, the level of national income and expenditure rises rapidly.


Your Answer False


44



Question Over the years in India the govt. expenditure is



Select The Blank Question In the context of formulation of an investment project, ________ feasibility means the availability of land,



Your Answer economic


Multiple Choice Multiple Answer 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 , Prospectus

Your Answer Memorandum of Association , Articles of Association , Prospectus

Match The Following


Defence service IndivisibleIndivisible


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


Select The Blank

Question Supply is predominantly determined by ________.

Correct Answer stock Your Answer demand

Select The Blank

Question Under the decreasing returns to scale, the marginal output curve slopes ________.Correct Answer downward

Your Answer downward


Question In Capitalism, the sovereign consumers express their preferences throughCorrect Answer price mechanism

Your Answer price mechanism


Question Forecasts made either through experience or through methodigistic areCorrect Answer statistical

Your Answer statistical

Select The Blank



True/False

Question Measurement of profit becomes difficult because of the difficulty involved in the calculation of depreciation.Correct Answer True

Your Answer True


Question Effective Demand coversCorrect Answer Consumption outlay for the households , Investment outlay in the private sector , Government’s spending for

consumption as well as investment

Your Answer Consumption outlay for the households , Investment outlay in the private sector , How a consumer effectively

demand the good in the market

Select The Blank

45






Multiple Choice Multiple Answer Question Methods of forecasting demand for new products are

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

Your Answer Test marketing , Evolutionary approach , Semi moving averages method






Question A technical unit of given capacity of output is


Your Answer firm

Select The Blank





True/False



Your Answer True

Select The Blank


Correct Answer Implicit cost

Your Answer Implicit cost

True/False

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 True

Your Answer True


Question Under the imperfect market, the market in which few firms exists is called asCorrect Answer Oligopoly

Your Answer Oligopoly

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 shareholders

True/False

Question Under perfect competition there are large number of buyers and few sellers.Correct Answer False

Your Answer True


Question Market system of economy is characterized by consumersCorrect Answer sovereignty

Your Answer preferences


Question Conditions of Price Discrimination are:Correct Answer The two markets in which the product is sold should be kept separate , The elasticity of demand in different


Your Answer The two markets in which the product is sold should be kept separate , Market must be perfect , The elasticity of

demand in different markets should be different

Select The Blank

46



Question The persons who own the ________hip concern are called Partners.

Correct Answer Partners

Your Answer Partners

Multiple Choice Single Answer Question The profits which must be deducted from the gross profits to arrive at net profits are

Correct Answer Monopoly Profits

Your Answer Monopoly Profits

Multiple Choice Single Answer Question The city of Kanpur has developed a big market for

Correct Answer leather goods

Your Answer leather goods

Multiple Choice Multiple Answer Question Various binds of economic policies are

Correct Answer Industrial liscencing policy , Commercial policy , Fiscal policy

Your Answer Industrial liscencing policy , Commercial policy , Fiscal policy

True/FalseQuestion It is easy to estimate the amount of black money


Your Answer False

Select The Blank

Question Modern economists treat social cost and benefits as ________ of private investment and production decisions.Correct Answer externalities

Your Answer externalities

Multiple Choice Single Answer Question The profit which is surplus of revenue over and above all paid out cost is

Correct Answer Accounting Profit

Your Answer Accounting Profit

True/FalseQuestion The partners are joint owners of the property a partnership firm.

Correct Answer True

Your Answer True


Question Question related to the efficient production and allocation belong to the branch of economic theory called

Correct Answer Welfare Economics

Your Answer Management Economics


Question Profit is regarded as

Correct Answer income accruing to the equity holders , wages accrue to the labour , rent accrue to the owner

Your Answer income accruing to the equity holders , wages accrue to the labour , rent accrue to the owner

Select The Blank

Question The out of pocket costs are ________.





Correct Answer compulsory

Your Answer voluntary


Question The market system of economy is based on the following foundations:

Correct Answer Consumer's Sovereignty , Non-interference by the state. , Private Profit Motive

Your Answer Consumer's Sovereignty , Non-interference by the state. , Private Profit Motive




Your Answer it is controlled by the state , separate funds to undertake their activity , they are accountable to public ,

unprofitable motive

47



True/False


Correct Answer True

Your Answer True


Question Variable cost are those costs which vary with the level of


Your Answer output Multiple Choice Single Answer

Question " The General Theory of Employment, Interest and Money" by Prof.J. M. Keynes was published in

Correct Answer 1936

Your Answer 1935


Question Objectives of economic policy are

Correct Answer To increase the efficiency and international competitiveness of industrial production , To improve the

performance and rationalize the scope of the public sector , To reform and modernize the financial sector

Your Answer To increase the efficiency and international competitiveness of industrial production , To improve the performance and rationalize the scope of the public sector , To reform and modernize the financial sector

True/False

Question The opportunity cost of a product is the opportunity gained of being able to produce some other product.


Your Answer False

Match The Following









Correct Answer an independently administered business unit , centre where the decisions about what to produce how to produceare taken , a business unit, which hires resources for production

Your Answer an independently administered business unit , centre where the decisions about what to produce how to produce


True/FalseQuestion Under perfect competition single seller can influence the price.


Your Answer False

Multiple Choice Multiple Answer Question According to Lionel Robbins definition of economics, "Economics is a science which

Correct Answer studies human behaviour , relationship between ends and scarse resources , scarce means have alternate uses

Your Answer studies human behaviour , relationship between ends and scarse resources , scarce means have alternate uses

Multiple Choice Multiple Answer Question The methods of calculating depreciation is

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

Your Answer Diminishing Balance Method , Annuity Method , Service Unit Method

True/FalseQuestion Demand is related to price, time and place.

Correct Answer True

Your Answer True

48




Select The Blank


________ Correct Answer Retail prices index


Select The Blank Question Sole Proprietorship which is also called sole ________ Correct Answer tradership

Your Answer tradership


Question The city of Coimbatore has developed a big market for Correct Answer spinning

Your Answer spinning


Question The firm is a center, where all the decisions are taken aboutCorrect Answer production


True/False

Question Pure (Net) profit contains an element of monopoly profit.



Question Implicit costs areCorrect Answer Cost on self owned resources , Costs of salary of the proprietor , Interest on the entrepreneur's own investment

Your Answer Cost on self owned resources , Costs of salary of the proprietor , Interest on the entrepreneur's own investment

Match The Following


Public utilities such as railway or cooking gas supply companies are allowed under the law to make price discrimination are

allowed under the law to make price discrimination

Monopsony is the monopoly from buyer’s side from buyer’s side

In oligopoly market, price tends to be rigid at the kink on the demand curve tends to be rigid at the kink on the demand

curve

Under monopolistic competition expenditure is incurred by the firms on cross transportation expenditure is incurred by the

firms on cross transportation

The price policy of a public enterprise should be such as to enable it to operate at the lowest cost possible and maximise

efficiency to enable it to operate at the lowest cost possible and maximise efficiency



Correct Answer exhaustedYour Answer exhausted

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 Wholesale prices index

True/False

Question A monopolist can decide both price and the quantity of a product that he is going produce and sell in the market.


Select The Blank


Correct Answer negativeYour Answer negative

49



True/False

Question When price of a commodity falls, the supply of that commodity increases.


Your Answer False

True/False

Question Price is the, only determinant of demand



Question Gross Profit includes


profitYour Answer remuneration for the factors of production paid by the entrepreneur , depreciation and maintenance charges , net

profit


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



Question The consumer protection Act includes

Correct Answer Protection from hazardous commodities , Right to a competitive price , Right to information regarding protection

Your Answer Protection from hazardous commodities , Right to information regarding protection , Protest against price

discrimination



Correct Answer commodities

Your Answer commodities



Correct Answer dynamism

Your Answer dynamism

True/False




True/False

Question Public enterprises have shown a very high rate of return of the capital invested



Question Consumption function refers to

Correct Answer income consumption relationship , representation as c=f(y) , functional relationship between two aggregatesYour Answer income consumption relationship , representation as c=f(y) , functional relationship between two aggregates


Question When a want can be satisfied by alternative similar other goods, they are called as



Question An individual does not voluntarily agree to pay the market price for the milk. As a result market refuses to

supply him the required quantity of milk. In this example , milk is anCorrect Answer divisible good

Your Answer divisible good

Select The Blank

Question Goods which are paradoxical to the law of demand are ________ Correct Answer Giffen goods, ,

50



Your Answer Giffen goods, ,

Match The Following


Monopolist ic competition Prof. Edward Chamberlin Price discrimination

Selling costs Monopolistic competition No Price Discrimination

Selling cost curve U shaped U shaped

Monopoly Price discrimination Monopolistic competition

Multiple Choice Single Answer Question During a period of rising prices (inflation), the goods and services are

Correct Answer scarce

Your Answer scarce

Multiple Choice Multiple Answer Question The economic stabilization means

Correct Answer Preventing excessive economic fluctuations , Efficient utilization of labor and other factors of production ,

Encouraging free competitive enterprise

Your Answer Preventing excessive economic fluctuations , Efficient utilization of labor and other factors of production ,


Select The Blank

Question In the 3rd stage of operation of the law of variable proportions, the marginal product becomes ________.

Correct Answer negative

Your Answer negative

Select The Blank

Question Increase in consumer’s income leads in the demand for inferior goods to ________



Select The Blank




Question Under perfect competition, generally demand and supply act and react upon each other and determine the price

which is inCorrect Answer equilibrium

Your Answer equilibrium

Select The Blank


Your Answer Joel Dean


Question Phases of business cycleCorrect Answer Expansion , Peak , Recession

Your Answer Expansion , Peak , Recession


Question Features of Long –run market areCorrect Answer It is durable goods market , Supply can be increased or reduced according to the demand , Sellers at least




Select The Blank




True/False

51



Question Social costs cannot be included in a firm's account book.

Correct Answer True

Your Answer False



Your Answer Gross National Product

Multiple Choice Single Answer Question Supply curve shifts to the right side of the original supply curve when, the supply



True/FalseQuestion The concept of economic profit differs from that of normal profit.


Your Answer False

Multiple Choice Multiple Answer 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 business solution

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



Question Assumptions of group equilibrium under Monopolistic Competition are

Correct Answer Competing firms are selling more or less the same product , The share of every firm in the total sales is equal ,

All firms are working with same efficiencyYour Answer Competing firms are selling more or less the same product , The share of every firm in the total sales is equal ,

All firms are working with same efficiency


Question In cost - benefit analysis, after the step of appraisal and selection of the project is the step of Correct Answer comparison of the cash flow

Your Answer implementation of the project

True/FalseQuestion The most significant feature of perfect competition is the existence of an automatic price mechanism.

Correct Answer True

Your Answer True

Multiple Choice Single Answer Question In economics, demand means desire backed by adequate

Correct Answer purchasing power

Your Answer ability to pay

True/FalseQuestion The wage and salary earners who get fixed income in terms of money are benefited during inflation.


Your Answer False

Select The Blank Question The goods become ________ only when each individual has an access to the entire amount of it and its use by









True/False


52



Your Answer False

True/False

Question A fall in quantity demanded without a fall in price shows decrease in demand.



Question Marshall has classified the period of time into three headsCorrect Answer Short run , Long run , Market periodYour Answer Demand period , Short run , Long run



Correct Answer Welfare EconomicsYour Answer Welfare Economics



Correct Answer applied economicsYour Answer applied economics


Question Defects of market system:

Correct Answer Inequalities of income and wealth , Emergence of monopolies , Failure to provide full employment

Your Answer Inequalities of income and wealth , Emergence of monopolies , Failure to provide full employment







Your Answer Addition to the real capital assets , It leads to increase in level of income , It increases supply immediately

True/FalseQuestion Demand is related to price, time and place.

Correct Answer True

Your Answer True

Select The Blank Question Supply is predominantly determined by ________.

Correct Answer stock

Your Answer stock

True/FalseQuestion The demand curve has a negative slope.

Correct Answer True

Your Answer True

Select The Blank Question The goods become ________ only when each individual has an access to the entire amount of it and its use by the

individual does not reduce its availability to others.


Your Answer public


Question Managerial economics refers to the integration of economic theory with business

Correct Answer practices

Your Answer practices





True/False

53



Question Measurement of profit becomes difficult because of the difficulty involved in the calculation of depreciation.

Correct Answer True

Your Answer True

Multiple Choice Single Answer 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








Question Under cost plus pricing

Correct Answer The price is set to cover material, labour cost , Actual costs, standard costs are included , Certain percentage of


Your Answer The price is set to cover material, labour cost , Actual costs, standard costs are included , Certain percentage of profitalso included


Question Managerial economics aims at providing guidance to the firms for

Correct Answer decision making

Your Answer decision making


Question The city of Kashmir has specialized in the manufacture of

Correct Answer shawlsYour Answer shawls





Question The concept of just distribution of national product is aCorrect Answer normative

Your Answer positive

Select The Blank

Question By ' profits', the accountant means total revenue minus________.Correct Answer Explicit costs


Select The Blank

Question The sum of all individual demands constitutes________ Correct Answer market demand





Select The Blank

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


Match The Following


A rightwards shift in supply schedule indicates an increase in supply. zero elasticity of supply.

Normally the isoquant slopes upward from right to left. an increase in supply.

Any straight line supply curve which cuts y axis will have zero elasticity of supply. downward from right to left

54



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

Multiple Choice Multiple Answer Question Preference Shares can be classified as

Correct Answer Simple Shares , Cumulative Shares , Redeemable Shares

Your Answer Simple Shares , Cumulative Shares , Deferred Shares

True/FalseQuestion The congress government led by Narsimha Rao announced the New Industrial Policy in July 1991.

Correct Answer True

Your Answer False

Multiple Choice Single Answer Question If the substitutes are relatively costly then the demand for the commodity in question will be

Correct Answer more

Your Answer less

True/FalseQuestion Under the liberalization policy, Government added another list of nine industries for which automatic approval upto 74 %

would be allowed

Correct Answer True

Your Answer True

True/FalseQuestion The damage being done by the factories at and around Agra to Taj Mahal is an example of social cost for private benefit.

Correct Answer True

Your Answer True

Select The Blank







Your Answer Ricardo


Question Factors influencing selling costs are

Correct Answer Type of product , Introduction of new goods , Technology changes

Your Answer Type of product , Introduction of new goods , Technology changes


Question The characteristics of a sole proprietorship firm is

Correct Answer Unlimited Capital , Ownership by a single person , Easy to form

Your Answer Unlimited Capital , Ownership by a single person , Easy to form

True/False

Question In case of a partnership firm, the liability of a partner is limited


Your Answer False


Question The characteristics of Inflation are

Correct Answer Excess of demand , Sustained rise in prices , Cannot be anticipated

Your Answer Excess of demand , Sustained rise in prices , It is limited to some geographical areas

Select The Blank

Question ________ effects are those externalities which flow from the production or use of the good to other parties or economic

units.

Correct Answer Third partyYour Answer External


Question If the substitutes are relatively cheaper then the demand for the commodity in question will be

Correct Answer lessYour Answer more

55




Question Under monopoly the demand curve slopes

Correct Answer downward

Your Answer upward

Select The Blank



Select The Blank



Your Answer substitute goods


Question In case of a proprietory firm, the liability for all his debts is

Correct Answer unlimited

Your Answer unlimited

Select The Blank

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.


Your Answer infrastructure

Match The Following








Question 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









Multiple Choice Single Answer Question The type economic problem is






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

56






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








Match The Following








Question An assembly of several machines, linked together either physically or by processes capable of producing a

given quantity of a product per day isCorrect Answer plant

Your Answer plant


Question In the cost – benefit analysis, after formulating various alternative project capacity, each of them has to beexamined in terms of its



Multiple Choice Single Answer Question Joint Stock Company succession is



True/FalseQuestion In the market, any one who agrees to pay the requisite price of a product would be excluded from their

consumption


Your Answer False


Question According to J.M. Keynes, the equilibrium between the aggregate demand function and the aggregate supply

function can, and often does take, place at



True/False

Question The prosperity phase is characterized by rise in the national output

Correct Answer True

Your Answer True

57



True/False

Question Inflation is a sustained and appreciable rise in prices

Correct Answer True

Your Answer True




Your Answer increasing Multiple Choice Single Answer

Question Gross profit is the excess of total revenue of a firm over total




Question Depreciation is the value caused by the continuous use of a capital asset is

Correct Answer loss

Your Answer loss

True/False


account.

Correct Answer True

Your Answer True




Your Answer change




Your Answer future

True/False



True/False


Correct Answer TrueYour Answer False

Select The Blank

Question Administered ________ are normally set on the basis of cost plus a ________ margin of profit

Correct Answer pricesYour Answer prices

Correct Answer stipulated

Your Answer stipulated

Multiple Choice Single Answer Question Costs which increase because of the expansion of a firm are called costs



True/FalseQuestion Contraction of supply is traced by the downward movement on the supply curve.

Correct Answer True

Your Answer True



Correct Answer True

Your Answer True

True/False

58





Your Answer True




Your Answer Supply of goods can be adjusted to the demand to some extent , Some factors can be changed , Supply anddemand determine the price

True/False


Correct Answer True

Your Answer True



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

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

firm is different

Select The Blank

Question Under monopoly, there is ________ seller who controls the entire ________ in the market

Correct Answer only oneYour Answer only one


Your Answer supply

Select The Blank




Correct Answer few firmsYour Answer few firms

Select The Blank

Question Cost-benefit analysis refers to the analysis undertaken to judge any projects ________ whether government or private and find out its ________ and facilities its comparison with other available oppor

Correct Answer investments



Your Answer worth


Question Effective Demand


economy , Study of aggregate demand and aggregate supplyYour Answer Study of aggregate demand and aggregate supply



Correct Answer Decrease in economic activities , The growth rate becomes negative , The level of national income declinesrapidly

Your Answer Decrease in economic activities , The growth rate becomes negative , The level of national income declines

rapidly




Your Answer company





59





Correct Answer An independently administered business unit. , A center of where the decisions about what to produce how to

produce are taken , A business unit, which hires resources for production.Your Answer An independently administered business unit. , A center of where the decisions about what to produce how to


Multiple Choice Multiple Answer Question Exceptions to the Law of Demand areCorrect Answer Giffen Goods , Articles of snob Appeal , Speculation



Question Explicit costs are:Correct Answer Out of pocket costs , Expenditure costs , These are firms accounting expenses


Select The Blank

Question The 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 Answer human capacity

Your Answer human capacity

Select The Blank

Question The ________-taking theory was developed by the ________ . According to him, profit arises because

considerable amount of risk is involved in business.

Correct Answer American economist HawleyYour Answer risk

Correct Answer risk


Select The Blank Question A tabular statement of ________ relationship is known as the ________ schedule, there are two types of

demand schedules: (1) the individual demand schedule, and (ii) the market demand schedule


Your Answer Price-quantityCorrect Answer demand

Your Answer demand

Select The Blank

Question The extent of the change of demand for a commodity to a given change in ________ , other demanddeterminants remaining constant, is termed as the ________ of demand.

Correct Answer price

Your Answer price



Select The Blank




Your Answer changes

Select The Blank

Question The money payment, which a firm makes to those ________ who supply labour services, raw materials,transport services, electricity etc. are called ________ costs.



Correct Answer explicit

Your Answer explicit




Correct 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 , they are accountable to public , unprofitable motive

60



Select The Blank




Select The Blank



Match The Following


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


Question Demand for products like tea, betel, tobacoo, sigaratte is a matter of

Correct Answer habitYour Answer habit

Select The Blank

Question In the context of externalities, driving the smoke-emitting buses and trucks in the cities is an example of ________ cost.


Your Answer social

Select The Blank Question A fall in price tends the demand for goods to ________

Correct Answer expand

Your Answer expand

True/False

Question The divisible goods, whose benefits can be priced, are called pure public goods.


Your Answer True


Question Assets =

Correct Answer Liabilities + Proprietorship

Your Answer Liabilities - revenue

Select The Blank

Question “Homeostatic Approach” as an alternative objective of firms was suggested by ________.


Your Answer Prof. Kenneth Boulding



Correct Answer Remuneration to factors of production , Depreciation , Maintenance Charges

Your Answer Remuneration to factors of production , Depreciation , Maintenance Charges

True/False

Question A Joint Stock Company is managed by the Board of Directors elected by shareholders.

Correct Answer True

Your Answer True

Select The Blank

Question The liability of a Karta in a Joint Hindu Family Business firm is ________.

Correct Answer limited



61



Question Features of the firm are


company

Your Answer It is a business unit organized under one ownership , It is a sole proprietorship , It is a partnership or joint stock

company

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

True/False

Question Demand and desire are one and the same.


Your Answer False

True/False

Question Inflation reduces the purchasing power of people's income and savings.

Correct Answer True

Your Answer True


Question J.M. Keynes' economic analysis come under

Correct Answer macro analysis

Your Answer macro analysis





Match The Following


N.G.O.S Voluntary social workVoluntary social work

Sole proprietorship Unlimited liability Unlimited liability

Preference shares Fixed rate of dividendNo dividend

Public enterprises State control State control

Multiple Choice Single Answer Question The private sector is owned by

Correct Answer private individuals

Your Answer private individuals




Multiple Choice Multiple Answer Question In the Dynamic Theory of Profit, Prof. Clark has pointed out the types of changes, which are

Correct Answer Changes in the supply of capital , Changes in population , Changes in the techniques of production

Your Answer Changes in the supply of capital , Changes in population , Changes in the techniques of production

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



True/FalseQuestion Pure public goods must be in the hands of public sector only.

Correct Answer True

Your Answer False

Multiple Choice Single Answer Question Given the price, if the cost of production increases because of higher price of raw materials, the supply

62



Correct Answer decreases

Your Answer decreases

True/False

Question When price of a commodity falls, the supply of that commodity increases.Correct Answer False

Your Answer False

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

Your Answer False


Question The act of manufacturing goods and services is calledCorrect Answer production



Question In a market economy, a firm in the private sector basically aims at maximization of Correct Answer money profits

Your Answer sales


Question The principle of exclusion cannot be applied to the goods, which are


True/False

Question Market price fluctuates very often.Correct Answer True

Your Answer True


Question Demand CurveCorrect Answer Is a graphical presentation , Slopes downward , Explain the relation between price and demand


Multiple Choice Single Answer Question Peas & beas, groundnut oil & til oil, tea & coffee are examples of

Correct Answer substitutes goods

Your Answer complimentary goods

Multiple Choice Multiple Answer Question Reasons for need of public distribution system are



Your Answer To maintain stable price conditions , To bring an efficient management of the supply , To supply the necessary


True/False

Question In a market system of an economy procedures are guided by profit motive.

Correct Answer True

Your Answer True

True/False

Question In a market economy, characterized by Capitalism, there is full interference by the State in the economic

activities of consumers and producers.




Correct Answer excess of supplyYour Answer surplus




63



Your Answer Addition to the real capital assets , It leads to increase in level of income , Increases accumulated wealth of the

society

Select The Blank

Question In the context of formulating an investment project, ________ feasibility means the availability of supervisorsfor implementing and running the project smoothly and professionally.


Your Answer organizational

Multiple Choice Multiple Answer Question Characteristics of the phase of Depression are


rapidly

Your Answer The growth rate becomes negative , The level of national income declines rapidly , The level of unemployment

decreases rapidly



Correct Answer More employment opportunities , Increase in profitability , Wage rate increase

Your Answer More employment opportunities , Increase in profitability , Wage rate increase

Select The Blank


Correct Answer public

Your Answer public


Question According to J.M. Keynes, there is inducement to invest, when the marginal efficiency of capital is greater than

Correct Answer rate of interest

Your Answer rate of capital formation


Question In case of defense services, all the sections of the society are equally protected and benefited. The defense


Correct Answer indivisible in character , cannot be priced in the market , a public goodYour Answer cannot be priced in the market , a public good , divisible in character

Select The Blank

Question The salary of the proprietor or rent on own land are the ________.Correct Answer Implicit cost



Question The production function can be explained byCorrect Answer Law of variable proportions , Laws of returns to scale , Optimum combinations of inputs



True/False

Question In experimental price approach the firms takes some cognizance of the demand for the product and proceeds to

fix a price by a trial – and – error method.



Question Contraction of demand is defined as a situation, when lesser quantity of a commodity is demanded only because

the price of the commodity in question hasCorrect Answer risen

Your Answer risen


Question Methods of measurement of elasticity areCorrect Answer Percentage method , Point elasticity method , Total outlay expenditure method

Your Answer Percentage method , Point elasticity method , Total outlay expenditure method


Question Market economy or private enterprise economy is a economy which isCorrect Answer planless

64



Your Answer planned

True/False




Question 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

Select The Blank


Correct Answer decreaseYour Answer increase

True/False

Question In market period supply is elastic.



Question Methods of forecasting demand for new products are


Your Answer Product life cycle analysis , Test marketing , Evolutionary approach



Correct Answer Negative income elasticity , Zero income elasticity , Unit income elasticityYour Answer Negative income elasticity , Zero income elasticity , Unit income elasticity


Question If supply of goods and services can be increased to correspond with every increase in demand, price level will

tend toCorrect Answer be stable

Your Answer rise

True/FalseQuestion The distinction between fixed costs and variable costs is relevant in the short period only.

Correct Answer True

Your Answer True

Multiple Choice Multiple Answer Question Different types of Elasticity of Demand are



Select The Blank Question Supply is predominantly determined by ________.


Your Answer demand

Multiple Choice Multiple Answer Question Demand curve of an individual for a commodity X is based on the following assumptions

Correct Answer Elasticity of demand for good x , Price of good x , Income of the consumer

Your Answer Elasticity of demand for good x , Price of good x , Income of the consumer

Multiple Choice Multiple Answer Question Features of Oligopoly Market are

Correct Answer Few sellers , Restriction to entry of new firms , Price leadership


Multiple Choice Single Answer Question Dalal Street in Bombay is known as

Correct Answer Bombay Stock Exchange


Select The Blank Question By ' profits', the economist means total revenue minus ________.

65



Correct Answer All costs


True/False

Question During the period of recession there is increase in incomes of wage and interest earners.Correct Answer False

Your Answer False

Multiple Choice Single Answer Question The assumption of perfect competition in all the analytical theories is made byCorrect Answer Classical economists

Your Answer Keynesian economists

Select The Blank

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.



True/FalseQuestion A monopolist’s product is a unique product.

Correct Answer True

Your Answer True

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________


Your Answer unity

True/False

Question In the traditional concept of equilibrium, a firm attains the equilibrium when the firm’s Total Revenue (T.R.)

=Total Cost (T.C.).


Your Answer False

Select The Blank

Question Baumol has suggested as an alternative objective for profit maximization , the maximization of ________

Correct Answer salesYour Answer sales

Select The Blank



Your Answer Third party


Question Depreciation is the value caused by the continuous use of a capital asset, which indicatesCorrect Answer loss

Your Answer loss

Select The Blank

Question Perfectly elastic demand curve is ________ Correct Answer horizontal



Question The number of buyers & sellers operating under perfect competition isCorrect Answer large

Your Answer large


Question The promoters of a company can get incorporated by filing with the registrarof companies various documentssuch as


Your Answer Memorandum of Association , Articles of Association , Prospectus

Multiple Choice Multiple Answer Question The fiscal policy includes

66





True/False


Correct Answer True

Your Answer True

Match The Following


Paid – up capital is that part of the subscribed capital which the public directly pay – up to the company, as part payment of the

share which the public directly pay – up to the company, as part payment of the share

Authorized capital refers to the maximum amount which can be raised by a company by selling shares. the maximum amount

which can be raised by a company by selling shares.

Issued capital refers to that part public of the authorized capital which is issued for subscription by dividing into shares. which is

issued for subscription by dividing into shares.

Subscribed Capital is that part of the issued capital which is actually subscribed by the public. that part of the issued capital

which is actually subscribed by the public.

Multiple Choice Single Answer Question The Risk theory of profit was developed by

Correct Answer Hawley

Your Answer Hawley


Question Cost-Benefit Analysis is

Correct Answer The analysis undertaken to judge the investment of any project , Refers to finding out the worth of investment ,

Enable ranking of optional investments

Your Answer The analysis undertaken to judge the investment of any project , Refers to finding out the worth of investment ,Ensured the net wealth can maximize social welfare


Question All the buyers and sellers operating under perfect competition have knowledge which isCorrect Answer perfect

Your Answer perfect


Question Forecasts made either through experience or through methodigistic areCorrect Answer statistical

Your Answer statistical

Match The Following


Partnership Unlimited liability Unlimited liability

Firm Economic unit Technical unit

Railways State enterprise State enterprise

Proprietary firms Ownership by a single person Ownership by a single person


Question In cost benefit analysis, in the valuation of costs and benefits, for finding the present value, one has to make use

of

Correct Answer discount rate

Your Answer discount rate





67








Question According to J.M.Keynes, the equilibrium is established at the level


Your Answer less than full employment Select The Blank



Your Answer hazardous

Select The Blank

Question Sole Proprietorship which is also called sole ________

Correct Answer tradership





Your Answer Monopoly , Duopoly , Oligopoly

True/FalseQuestion The congress government led by Narsimha Rao announced the New Industrial Policy in July 1991.

Correct Answer True

Your Answer True

True/False

Question Micro-economics theory studies how a free enterprise economy determines the price of goods and services.


Your Answer False



Question Features of Pure Competition areCorrect Answer Large number of buyers and sellers , Homogeneous products , Free entry and free exit of firms

Your Answer Large number of buyers and sellers , Homogeneous products , Free entry and free exit of firms


Question Methods of measurement of elasticity areCorrect Answer Percentage method , Point elasticity method , Total outlay expenditure method

Your Answer Percentage method , Point elasticity method , Total outlay expenditure method


Question Managerial economics is also understood to refer toCorrect Answer applied economics


True/False

Question The short run Average Cost (A.C.) curve is U shaped.Correct Answer True

Your Answer True


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


Your Answer The price is set to cover material, labour cost , Actual costs, standard costs are included , Certain percentage of


Select The Blank





68



Question The subject matter of Micro economics includes the study of

Correct Answer an individual consumer , particular market for a given commodity , operation of a firm

Your Answer an individual consumer , particular market for a given commodity

Select The Blank Question The persons who own the ________hip concern are called Partners.



Select The Blank Question While discussing the product divisibility of public and private goods, the principle of ________ may be applied





Question The main objective of a co- operative organization is

Correct Answer service

Your Answer service


Question With technological advances, with the given inputs, the flow of output



True/FalseQuestion Contraction of supply is traced by the downward movement on the supply curve

Correct Answer True

Your Answer True


Question In the Long run perfect competition and monopolistic competition the firm make profits which are

Correct Answer normal

Your Answer normal


Question Phases of business cycle

Correct Answer Expansion , Peak , Recession

Your Answer Expansion , Peak , Recession , Trough


Question In case of perfectly elastic supply, the supply curve is


Your Answer hyperbola





Select The Blank

Question A private limited company can be formed with 2 to 50 members maximum, excluding ________

Correct Answer employee shareholders


Select The Blank

Question Modern economists treat social cost and benefits as ________ of private investment and production decisions.

Correct Answer externalities



Question Production Function implies relationship between

Correct Answer input & output

Your Answer input & output

True/False



Your Answer False

69



Match The Following


Methods of production of commodities Theory of production Theory of production

General theory of employment, interest and money J. M. Keynes J. M. Keynes


Services Intangible goods Intangible goods




Select The Blank




Question True inflation starts only after reaching the level of full



Match The Following








Question All firms producing the homogenous or similar products together make

Correct Answer an industryYour Answer an industry



Correct Answer Gross National Product , National Product , National IncomeYour Answer National Income



supply him the required quantity of milk. In this example , milk is anCorrect Answer divisible good

Your Answer divisible good


Question Scope of Managerial Economics deals withCorrect Answer Demand analysis and forecasting , Production function & cost analysis , Inventory management adverting, price

system

Your Answer Demand analysis and forecasting , Production function & cost analysis , Inventory management adverting, price

system




Your Answer large


70






True/FalseQuestion Measurement of profit becomes difficult because of the difficulty involved in the calculation of depreciation.

Correct Answer True

Your Answer True

Multiple Choice Single Answer Question Economic Profit takes in to account the

Correct Answer implicit cost

Your Answer implicit cost

True/FalseQuestion The supply curve slopes downwards from left to right.


Your Answer False

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

Correct Answer Joel Dean







Question Characteristics of the phase of Recession are

Correct Answer Investments decline , Negative multiplier gets underway , Inventories pile up

Your Answer Negative multiplier gets underway , Inventories pile up

Select The Blank

Question Demand for safety pins is ________



True/False


Correct Answer True

Your Answer True





True/False

Question Macro economic studies are based on empirical evidence.

Correct Answer True

Your Answer True

Select The Blank

Question The social costs and benefits are the external economies and diseconomies resulting from the ________

activities, which are known as, "externalities"

Correct Answer firm'sYour Answer firm's


Question Price discrimination is possible in case of

Correct Answer public utilities with legal sanction , personnel services sold , geographical barriersYour Answer monopolistic market , personnel services sold , geographical barriers

True/False



71



True/False

Question In case of a partnership firm of business organization a minor can become partner of the firm.


Your Answer False


Question The Government attempts to increase supplies of food grains and other essential goods in times of internal

shortage through larger Correct Answer importsYour Answer imports

Select The Blank


Correct Answer Explicit costsYour Answer Explicit costs



Question Pure public goods are subject to the law of decreasing average cost, because of the

Correct Answer economies of scale

Your Answer economies of scale

Multiple Choice Multiple Answer Question Features of Long –run market are

Correct Answer It is durable goods market , Supply can be increased or reduced according to the demand , Sellers at least recover

minimum price for their goods

Your Answer It is durable goods market , Supply can be increased or reduced according to the demand , Sellers at least recover minimum price for their goods

True/False

Question In case of indivisible goods, which are not priced, the decisions regarding their demand preferences are taken through

price mechanism.Correct Answer False

Your Answer True

Multiple Choice Single Answer Question A responsible factor for inflation is



True/FalseQuestion A monopolist’s product is a unique product.

Correct Answer True

Your Answer True

Multiple Choice Multiple Answer Question Important theories of profits are

Correct Answer Uncertainty-bearing theory of profit , Dynamic theory of profit , Life cycle theory

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

Multiple Choice Multiple Answer Question The promoters of a company can get incorporated by filing with the registrarof companies various documents such as


Your Answer Memorandum of Association , Articles of Association




Multiple Choice Single Answer Question The indivisible goods whose benefits cannot be priced are called


Your Answer Pure private goods

Select The Blank Question The partnership between private sector & government is called ________

72






Question The main objective of a co- operative organization isCorrect Answer service

Your Answer service

Multiple Choice Multiple Answer Question 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 effect

Your Answer It is a wave like movement , These fluctuations are recurrent in nature , Expansion and contraction in trade cycle are

cumulative in effect

Match The Following


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


Question The profits which must be deducted from the gross profits to arrive at net profits are

Correct Answer Monopoly ProfitsYour Answer Accounting Profit

True/False

Question The products sold by different sellers under pure competition are heterogeneous.


Match The Following


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


Question Cournot' , the economists who defined the term 'market' different from that of the traditional sense is an

Correct Answer French economists

Your Answer German economists




Your Answer risk bearing

Select The Blank

Question The goods become ________ only when each individual has an access to the entire amount of it and its use by the

individual does not reduce its availability to others.




Question The advantage of cost-benefit analysis are

Correct Answer Maximization of social welfare , Objective measurement of the trade-off , Maximization of difference between

total benefits & total costs

73



Your Answer Objective measurement of the trade-off , Maximization of difference between total benefits & total costs , Applicable

only in partial equilibrium framework.

True/False

Question Supply management is related to the volume ofsupply & its distribution system.Correct Answer True

Your Answer True

Multiple Choice Multiple Answer Question The important determinants of supply areCorrect Answer Always referred to in relation to price & time , Government policy , Availability of factors of production

Your Answer Availability of factors of production , Tastes and preferences of producer


Question The features of a Joint Stock-Company areCorrect Answer perpetual succession , limited liability , free transferability of shares

Your 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 is referred to as ________.Correct Answer increasing returns to scale.


Select The Blank

Question A fall in price tends the demand for goods to ________

Correct Answer expandYour Answer increase


Question Average propensity to consume is characterized as followsCorrect Answer the ratio of consumption expenditure to any particular level of income , It is found by dividing consumption

expenditure by income , It is expressed as the percentage of income consumed

Your Answer the ratio of consumption expenditure to any particular level of income , It is found by dividing consumption

expenditure by income , It is expressed as the percentage of income consumed

True/False

Question 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 Is in tabular form , It shows the prices of goods , It shows the quantities of a commodity purchasedYour Answer Is in tabular form , It shows the prices of goods , It shows the quantities of a commodity purchased

Select The Blank




Question 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


Correct Answer socialYour Answer social

True/False

Question There are no real exceptions to the law of demand


True/False



74



True/False


Correct Answer True

Your Answer True


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

Select The Blank

Question Economists like A.C.Harberger have shown that the cost benefit analysis can be applied to ________ analysis.

Correct Answer general equilibrium

Your Answer general equilibrium




Your Answer Marshall


Question The act of manufacturing goods and services is called



True/False



Your Answer False

Select The Blank



Your Answer demand

Select The Blank

Question The social costs and benefits are the external economies and diseconomies resulting from the ________ activities, which

are known as, "externalities"Correct Answer firm's


True/False

Question Free riders' is a term associated with the people who would like to have benefit of a good without sharing the cost of itssupply.

Correct Answer True

Your Answer True

Multiple Choice Single Answer Question Change in income of a person may result in demand for goods to


Your Answer change

Multiple Choice Single Answer Question Managerial economics aims at providing guidance to the firms for



Multiple Choice Single Answer Question When in order to satisfy a given want , 2 or more goods are needed in combination, these goods are called

Correct Answer complimentary goods


Multiple Choice Multiple Answer Question Forecasts can be made at the level of

Correct Answer A firm , An industry , The nation

Your Answer A firm , An industry

Select The Blank

75



Question Cost-benefit analysis refers to the analysis undertaken to judge any projects ________ whether government or private and

find out its worth.




True/FalseQuestion During inflation, the pensioners whose income is permanently fixed, are substantially benefited.Correct Answer False

Your Answer True


Question During the period of depression various factors of production areCorrect Answer exhausted

Your Answer unutilized

True/False

Question When demand and supply rise and fall in the same proportion, the equilibrium price changes.Correct Answer False

Your Answer False

Select The Blank


Correct Answer Prof. Kenneth BouldingYour Answer Joel Dean

Select The Blank

Question The social costs and benefits are the external economies and diseconomies resulting from the ________ activities, whichare known as, "externalities"

Correct Answer firm's

Your Answer firm's

Multiple Choice Single Answer Question Economists call all human resources mental, physical , inherited and acquired as

Correct Answer Labour

Your Answer Labour






Question Internal Economies involves

Correct Answer Advantages of large-scale production , Low cost of production , It avails benefits of cheaper finance

Your Answer Low cost of production , It avails benefits of cheaper finance , Availability of banking facility

Select The Blank



Your Answer relatively inelastic

Select The Blank

Question By ' profits', the economist means total revenue minus ________.




Question Distinction between private sector and public sector is determined


Your Answer on the basis of economic system , on the basis of motive , on the basis of infrastructure

Select The Blank

Question The liability of a Karta in a Joint Hindu Family Business

is ________.



76



True/False

Question When a change in income has no effect upon the quantity demanded of a product, the income elasticity of demand is zero

Correct Answer True

Your Answer True

Select The Blank

Question The externality which causes an economic gain or an economic loss to other economic units is also referred to as

________ externality.

Correct Answer PecuniaryYour Answer Economic

True/False

Question Micro-economics is primarily concerned with the problem of what, how and for whom to produce?


Your Answer True

True/False

Question During period of depression various factors of production lie unutilized.

Correct Answer True

Your Answer True

True/False


Correct Answer True

Your Answer True



Correct Answer Total product increases at an increasing rate , Marginal product increasing and it is maximum , Average product is

increasing but it is below MPYour Answer Total product increases at an increasing rate , Marginal product increasing and it is maximum , Average product is

increasing but it is above MP

Match The Following


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


Question During a period of rising prices (inflation), the goods and services are

Correct Answer scarce

Your Answer scarce

Select The Blank



Your Answer public


Question Reasons for change in Demand (Increase or Decrease in Demand)


Your Answer Change income of consumer , Change in fashion and customs

Select The Blank






Correct Answer public utilities with legal sanction , personnel services sold , geographical barriers

Your Answer monopolistic market , personnel services sold

77



True/False


Correct Answer True

Your Answer True

True/False

Question Demand for luxury goods is inelastic


Your Answer True

True/False

Question Market price fluctuates very often.

Correct Answer True

Your Answer True




Your Answer equal to full employment

Match The Following




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.


Question Joint Stock Company is an incorporated association with aCorrect Answer perpetual succession

Your Answer perpetual succession

Select The Blank Question Sole Proprietorship which is also called sole ________



Multiple Choice Single Answer Question The market which covers capital market & all banking and non-banking institutions are together taken as

Correct Answer Financial Market

Your Answer Financial Market

Multiple Choice Multiple Answer Question According to Keynes there are three motives for holding cash for liquidity preference

Correct Answer the transactions motive , the precautionary motive , the speculative motive

Your Answer the transactions motive , the precautionary motive , the speculative motive



Your Answer Gross National Product , National Product

Multiple Choice Multiple Answer Question Co-operative organizations is

Correct Answer voluntary organization , managed by democratic principle , organization, which performs its business within the

members

Your Answer voluntary organization , managed by democratic principle , non profit motive organization

Select The Blank




Select The Blank

78





Your Answer profit

Multiple Choice Single Answer Question Economic problem does not recognize the boundaries of caste,creed,culture Thus economic problem is always considered

as the







Your Answer The two markets in which the product is sold should be kept separate , The elasticity of demand in different marketsshould be different , Market must be imperfect

True/False




Question Accounting profit includes




Question Depreciation is the value caused by the continuous use of a capital asset, which indicates

Correct Answer lossYour Answer loss


Question The railways use a lot of coal in firing the steam locomotives. This act causes

Correct Answer a lot of sufferings to the people near the railway. , cost to the society. , no cost to the railways.Your Answer a lot of sufferings to the people near the railway. , affects the railways


Question J.M. Keynes, on the basis of a fundamental psychological law of consumption, observed that as income increases,consumption also increases, but proportionately

Correct Answer less

Your Answer less

Multiple Choice Single Answer Question Slope of supply curve is

Correct Answer positive


Multiple Choice Multiple Answer Question Types of imperfect competition are



Multiple Choice Single Answer Question In the Long run perfect competition and monopolistic competition the firm make profits which are


Your Answer normal


Select The Blank



Select The Blank


Correct Answer negativeYour Answer remains same

79




Question The pioneering analysis of imperfect competition was done by Mrs. Jaon Robinson from the

Correct Answer Cambridge University

Your Answer Cambridge University


Question Contraction of demand is defined as a situation, when lesser quantity of a commodity is demanded only because the price

of the commodity in question hasCorrect Answer risenYour Answer risen

Select The Blank



Select The Blank

Question ________ effects are those externalities which flow from the production or use of the good to other parties or economic

units.Correct Answer Third party

Your Answer External

True/False

Question In experimental price approach the firms takes some cognizance of the demand for the product and proceeds to fix a price

by a trial – and – error method.Correct Answer True

Your Answer True


A monopolist gets abnormal profit. abnormal profit.

In oligopoly market, price tends to be rigid at the kink on the demand curve. tends to be flexible at the kink on the demand curve.

Under monopolistic competition, expenditure is incurred by the firms on cross transportation. to enable it to operate at the lowest cost

possible and maximize efficiency.

The price policy of a public enterprise should be such as to enable it to operate at the lowest cost possible and maximize efficiency.

expenditure is incurred by the firms on cross transportation.

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


Your Answer True

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

Correct Answer 3

Your Answer 4

Select The Blank Question The liability of a Karta in a Joint Hindu Family Business firm is ________.


Your Answer limited

Multiple Choice Single Answer Question Inflation is a phenomena in which prices

Correct Answer rise

Your Answer rise

True/FalseQuestion During the period of depression, demand for bank credit reaches its low level and banks experience mounting of their cash

balances.

Correct Answer True

Your Answer True


80



Question If supply of goods and services can be increased to correspond with every increase in demand, price level will tend to

Correct Answer be stable

Your Answer rise

Multiple Choice Multiple Answer Question According to Keynes, Aggregate supply function refers to

Correct Answer the minimum price of revenue which the entrepreneurs must get , Associated with different levels of employment ,

Explains that the level of out put varies with the level of employment

Your Answer the minimum price of revenue which the entrepreneurs must get , Associated with different levels of employment ,Explains that the level of out put varies with the level of employment


Question Exceptions to the Law of Demand are




Question J.M. Keynes stated that effective demand is determined by the interaction of the aggregate supply function and

Correct Answer aggregate demand function

Your Answer aggregate demand function


Question The supply curve during market period is

Correct Answer perfectly inelastic

Your Answer elastic

True/False



Your Answer True






Question Features of monopolistic Competition are

Correct Answer Fairly large number of firms , Product differentiation , Selling costs are existedYour Answer Fairly large number of firms , Product differentiation , Different demand and cost curves of firms


Question A competitive industry has three basic characteristics

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

Select The Blank


individual does not reduce its availability to others.Correct Answer indivisible



Question The use of a good by one more member of the society does not reduce its availability to others. This applies in case of Correct Answer Pure public good

Your Answer Private good


Question A firm is a unit of production, where production is done with the aim to maximizeCorrect Answer profits

Your Answer profits


Question When more units of a commodity are purchased in response to decline in price of that commodity, it is called as expansionof

Correct Answer demand

Your Answer demand

Multiple Choice Multiple Answer Question Distinction between private sector and public sector is determined

81





True/False

Question There are no real exceptions to the law of demandCorrect Answer False

Your Answer False

True/FalseQuestion In case of a partnership firm, the liability of a partner is limitedCorrect Answer False

Your Answer True


Question According to Lionel Robbins definition of economics, "Economics is a science whichCorrect Answer studies human behaviour , relationship between ends and scarse resources , scarce means have alternate uses

Your Answer studies human behaviour , relationship between ends and scarse resources , scarce means have alternate uses

True/False

Question It is easy to estimate the amount of black moneyCorrect Answer False

Your Answer False

Select The Blank


machinery, raw materials and technical know how etc.Correct Answer technical

Your Answer resource

Multiple Choice Multiple Answer Question The disinvestments of industries is needed for

Correct Answer Phased privatization , Reducing deficit , Capital support to plans

Your Answer Phased privatization , Reducing deficit , Capital support to plans

Multiple Choice Multiple Answer Question Advantages of Cost-Benefit Analysis

Correct Answer It aims at maximization of social welfare , In this principle, the problem of infinite target value does not arise , It

shows the measures necessary for attaining maximum net wealth

Your Answer It aims at maximization of social welfare , In this principle, the problem of infinite target value does not arise , Itshows the measures necessary for attaining maximum net wealth

True/False

Question The Keynesian theory emphasizes effective supply as a crucial factor in determining the level of income and employment.




Correct Answer Elasticity of demand for good x , Price of good x , Income of the consumer Your Answer Elasticity of demand for good x , Price of good x , Income of the consumer


Question The study of the supply side of product pricing is done under the

Correct Answer Theory of ProductionYour Answer Theory of Price

True/False

Question The distinction between fixed costs and variable costs is relevant in the short period only.


Select The Blank


Correct Answer general equilibriumYour Answer full equilibrium

Select The Blank

Question On the ________ level, the summation of maximum individual welfare does not automatically lead to maximum social

welfare.Correct Answer macro

82



Your Answer national

Select The Blank

Question Like all organism, the firm too is an organism according to the ________

Correct Answer life-cycle theory.Your Answer life-cycle theory.


Question Firm is anCorrect Answer economic unitYour Answer industrial unit


Question Market system of economy is characterized by consumers

Correct Answer sovereigntyYour Answer preferences

Match The Following


Giffen goods A lesser quantity purchased when the price falls more is purchased when price falls

Electricity Composite demand Composite demand

Tea and coffee Substitutes Substitutes

Unit income elasticity implies that as income rises demand for a commodity rises in the same proportion. in the same proportion.

True/FalseQuestion In case of a partnership firm of business organization a minor can become partner of the firm.


Your Answer True

Multiple Choice Multiple Answer Question Causes for rise in prices in India

Correct Answer Mounting government expenditure , Deficit financing and increase in money supply , Role of black money

Your Answer Mounting government expenditure , Deficit financing and increase in money supply , Increase in demand


Question Main aims of the New Industrial Policy (1991) are

Correct Answer To unshackle the indian industrial economy from the cobwebs of unnecessary bureaucratic control , To introduce

liberalization with a view to integrate the indian economy with the world economy , To remove restrictions on direct foreign

investment as also to free the domestic entrepreneur from the restriction of MRTP actYour Answer To unshackle the indian industrial economy from the cobwebs of unnecessary bureaucratic control , To introduce


investment as also to free the domestic entrepreneur from the restriction of MRTP act



Question The causes of inflation areCorrect Answer Increase in public expenditure , Increase in private expenditure , Increase in foreign demand

Your Answer Increase in public expenditure , Increase in private expenditure , Increase in foreign demand





Select The Blank Question The law of constant returns to scale is depicted by the marginal output curve which is ________.



True/FalseQuestion Institution of private property is not an essential feature of Capitalism.

83




Your Answer False

True/False

Question In market period supply is elastic.Correct Answer False

Your Answer False

True/FalseQuestion In a market system of an economy procedures are guided by profit motive.Correct Answer True

Your Answer True

True/False

Question Changes in the value of money because of inflation make inventory valuation of finished products difficult.Correct Answer True

Your Answer True

True/False

Question Under the liberalization policy, Government added another list of nine industries for which automatic approvalupto 74 % would be allowed

Correct Answer True

Your Answer True

Match The Following







Multiple Choice Multiple Answer Question Steps in cost benefit analysis

Correct Answer Identification of a project , Formulation of the project , Appraisal and selection of the project

Your Answer Identification of a project , Formulation of the project , Appraisal and selection of the project



Your Answer Evolutionary approach




True/FalseQuestion In case of a partnership firm, the liability of a partner is limited


Your Answer False

Multiple Choice Single Answer Question Partnership in case of general business consists of minimum two persons and maximum

Correct Answer 20 persons

Your Answer 20 persons

Multiple Choice Multiple Answer Question The advantage of cost-benefit analysis are



Your Answer Maximization of difference between total benefits & total costs , Maximization of social welfare , Objective

measurement of the trade-off

84







True/False

Question Consumer’s protection involves protection to the consumers from unfair trade practices.

Correct Answer True

Your Answer False Multiple Choice Single Answer

Question In general, the demand for necessaries is relatively


Your Answer elastic


Question Managerial economics deals with



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

True/False

Question The partners are joint owners of the property a partnership firm.

Correct Answer True

Your Answer True








Question 'Output' which means supply of product depends upon theCorrect Answer cost of production

Your Answer cost of production

True/False

Question Generally, the larger the income of a consumer, his demand for overall commodities tends to be relativelyelastic.


Your Answer True

True/FalseQuestion The short run Average Cost (A.C.) curve is U shaped.

Correct Answer True

Your Answer True

Select The Blank Question The liability of a Karta in a Joint Hindu Family Business firm is ________.



Multiple Choice Multiple Answer Question Profit is regarded as


Your Answer income accruing to the equity holders , wages accrue to the labour , rent accrue to the owner

Select The Blank Question A private limited company can be formed with 2 to 50 members maximum, excluding ________



Multiple Choice Single Answer Question Given the price, if the cost of production increases because of higher price of raw materials, the supply

85





Select The Blank



Your Answer social

Match The Following


Market period Perishable goods Perishable goods

Long run Non perishable goods Large number of producers

Perfect competition Automatic price mechanism Automatic price mechanism

Equilibrium price Demand and supply Demand and supply

Select The Blank





Question Car & petrol, tea & sugar, shoes & socks, sarees & blouse are examples of




Question The production function studies

Correct Answer Input and out put relation , Factors of production and final production , Technology used in production

Your Answer Input and out put relation

Select The Blank


private and find out its worth.Correct Answer investments



Question Types of income elasticity of demandCorrect Answer Negative income elasticity , Zero income elasticity , Unit income elasticity






Question According to Keynes, Effective DemandCorrect Answer Determines the level of income and output in an economy , Is total expenditure equal to total income in an

economy , Is the Study of aggregate demand and aggregate supply

Your Answer Determines the level of income and output in an economy , Is the Study of aggregate demand and aggregate

supply , Studies that as aggregate expenditure decreases the aggregate income increases


Question Under the imperfect market, the market in which few firms exists is called as

Correct Answer Oligopoly

Your Answer Oligopoly

Select The Blank




Select The Blank

86





Your Answer expand

Multiple Choice Single Answer Question When a want can be satisfied by alternative similar other goods, they are called as






Multiple Choice Single Answer Question If the increase in all factors leads to a less than proportionate increase in output, then the returns to scale are

Correct Answer decreasing

Your Answer decreasing

Multiple Choice Multiple Answer Question Implicit costs are

Correct Answer Cost on self owned resources , Costs of salary of the proprietor , Interest on the entrepreneur's own investment



Question According to Lionel Robbins, "Economics is a science which studiesCorrect Answer human behavior

Your Answer human behavior

Multiple Choice Single Answer Question A place where buyers & sellers meet each other to effect a business transaction is known as


Your Answer Market



Question Pure public goods are subject to the law of decreasing average cost, because of theCorrect Answer economies of scale



Question In the cost - benefit analysis, after formulating various alternative project capacity, each of them has to be examined interms of its



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


Your Answer True


Defence service Indivisible Indivisible








87



Your Answer Maximization of social welfare , Objective measurement of the trade-off , Maximization of difference between total

benefits & total costs


Question The term externalities may also be referred as:Correct Answer Spill-over effects , Neighborhood effects , Third party effects


Select The Blank Question Modern economists treat social cost and benefits as ________ of private investment and 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 be applied to ________ analysis.Correct Answer general equilibrium


Select The Blank

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



Select The Blank

Question Prof. Sam Nelson calls risks from unsafe factories or nuclear power plants as ________ economies.Correct Answer negative


Multiple Choice Single Answer Question According to Lionel Robbins, "Economics is a science which studies

Correct Answer human behavior

Your Answer social behavior

Multiple Choice Single Answer Question Question related to the efficient production and allocation belong to the branch of economic theory called


Your Answer Business Economics



Correct 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

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


Question 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


Correct Answer Prof. Kenneth BouldingYour Answer Prof. Kenneth Boulding

Select The Blank


Correct Answer Sole trader Your Answer Sole trader

True/False

Question Accounting profit takes in to account opportunity cost.


88






Your Answer jointly


Question If the substitutes are relatively costly then the demand for the commodity in question will be

Correct Answer moreYour Answer same

True/False



Your Answer False

True/False

Question Demand curve slopes downwards from left to right.

Correct Answer True

Your Answer True

Select The Blank




Select The Blank




Match The Following


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. perfectly inelastic.

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

Multiple Choice Multiple Answer Question Explicit costs are

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

Your 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 scale





Multiple Choice Single Answer Question Jevons' , the economists who defined the term 'market' different from that of the traditional sense is an



Multiple Choice Single Answer Question Economists have pointed out that the real world is full of

Correct Answer Imperfect competition

Your Answer Imperfect competition

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

89




Your Answer False

True/False


Your Answer False

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



Question Features of Pure Competition areCorrect Answer Large number of buyers and sellers , Homogeneous products , Free entry and free exit of firms



Question Equilibrium is the stage of Correct Answer maximum satisfaction , balance , stationary

Your Answer maximum satisfaction , balance


Question Inflation is a phenomena in which prices

Correct Answer riseYour Answer rise


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


True/False

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

Your Answer False

True/FalseQuestion Saving is a private virtue

Correct Answer True

Your Answer True

Multiple Choice Multiple Answer Question According to Keynes, Aggregate supply function refers to



Your Answer the minimum price of revenue which the entrepreneurs must get , Associated with different levels of employment ,



Question Marginal Propensity to consume is characterized as follows

Correct 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 the formula mpc= change in c/change in yYour Answer It is rate of change in the average propensity to consume as income changes , It is derived by the formula mpc=

change in c/change in y , It is derived by dividing the change in income by change in the consumption expenditure


Question During the period of depression various factors of production areCorrect Answer exhausted


True/False

Question In general SBI uses its monetary policy to achieve a judicious balance between the growth of production and control of the general price level.


Your Answer False

True/FalseQuestion Public enterprises have shown a very high rate of return of the capital invested

90




Your Answer False


Question The meaning of monetary policy isCorrect Answer It is programmed of the central bank , It controls the total supply of money , The basic objective is to achieve

economic stability

Your Answer It is programmed of the central bank , It controls the total supply of money , The basic objective is to achieve

economic stability





investment as also to free the domestic entrepreneur from the restriction of MRTP actYour Answer To unshackle the indian industrial economy from the cobwebs of unnecessary bureaucratic control , To introduce



Multiple Choice Multiple Answer Question Objectives of economic policy are

Correct Answer To increase the efficiency and international competitiveness of industrial production , To improve the performance

and rationalize the scope of the public sector , To reform and modernize the financial sector

Your Answer To increase the efficiency and international competitiveness of industrial production , To improve the performance



Multiple Choice Single Answer Question Economists call all human resources as

Correct Answer labor

Your Answer labor

True/FalseQuestion Economic problem arises only in case of an overpopulated country.


Your Answer False


Question All the buyers and sellers operating under perfect competition have knowledge


Your Answer perfect

True/False

Question The meaning of the word “economic” is most closely associated with the word unlimited

Correct Answer True

Your Answer True


Question The conditions of equilibrium of a firm are applicable to all markets

Correct Answer None

Your Answer particular

True/False

Question 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 True

Your Answer True


Question The price of a good and the exclusion princople together is

Correct Answer divisibility

Your Answer indivisibility


Question The liability of a sole proprietary firm is



91



True/False

Question Institution of private property is not an essential feature of Capitalism


Your Answer False

True/False

Question There never was in any country at any time ‘pure capitalism’ or ‘pure communism

Correct Answer True

Your Answer True True/False




Your Answer True

True/False

Question A Joint stock company has perpetual succession.

Correct Answer True

Your Answer True

True/False

Question The management of the cooperative form of business organization is totalitarian in nature.


Your Answer True


Question In Trade cycles the economic activity are

Correct Answer ups and downs


True/False

Question In macro – economic analysis the behavior of economic agents such as firms, households and government is

seen in total, disregarding details at particular level




Your Answer planned


Question New commodities due to technotogical progress may result in demand for traditional type of goodsCorrect Answer decrease



Question If a person is habituated to the consumption of a commodity and if he cannot easily give up its use, demand for it is generally




Normal demand curveDownwards to right Downwards to right

Income consumption curve Upwards to the right Upwards to the right

Inelastic demand curve Vertical straight line Vertical straight line

Cross elasticity of demand between two perfect substitute will be Infinity Infinity

A demand curve, which takes the form of a horizontal line parallelto the quantity axis illustrates elasticity Infinity. Infinity.


Question The law of diminishing returns is applicable to agriculture provided the state of technology is given andCorrect Answer constant

92



Your Answer resources


Question Under 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 Answer fair


Multiple Choice Single Answer Question The Government attempts to increase supplies of food grains and other essential goods in times of internal

shortage through larger

Correct Answer imports

Your Answer borrowings

True/FalseQuestion External economies are the advantages of large scale production enjoyed exclusively an individual firm alone.


Your Answer False

Multiple Choice Multiple Answer Question Equilibrium is

Correct Answer The stage of maximum satisfaction , The stage of balance , The stage of stationary

Your Answer The stage of balance


Question Conditions of equilibriumCorrect Answer Marginal Revenue should be equal to Marginal Cost , The Marginal cost curve should cut the marginal revenue

curve from below at the equilibrium point , Marginal cost curve should be increasing at equilibrium point

Your Answer Marginal Revenue should be equal to Marginal Cost , The Marginal cost curve should cut the marginal revenue

curve from below at the equilibrium point , Average cost curve should cut the Average Revenue curve

Select The Blank


private and find out its ________ and facilities its comparison with other available oppor

Correct Answer investmentsYour Answer investments


Your Answer profit


Question Aggregate supply function

Correct 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 employment

Your Answer Refers to show the varying level of supply at different prices




rapidlyYour Answer Decrease in economic activities , The growth rate becomes negative , The level of national income declines

rapidly


Question Recession includesCorrect Answer The demand is halted , Increase in production of goods , Inventories piling up in stocks

Your Answer The demand is halted , Inventories piling up in stocks , The growth of discrepancy between supply and demand

is very fast

Multiple Choice Multiple Answer Question The causes of inflation

Correct Answer Increase in public expenditure , Increase in private expenditure , Increase in foreign demand

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

Select The Blank Question In the ________ terminology, the ________ demand function refers to the schedule of maximum sales

proceeds, which the entrepreneurial community actually does expect to be received from the sale of

Correct Answer Keynesian

Your Answer Keynesian

Correct Answer aggregateYour Answer total

93



Select The Blank

Question The rate of interest, according to ________ , depends upon two factors: (i) ________ and (ii) the quantity of

money

Correct Answer KeynesYour Answer Keynes

Correct Answer the liquidity preference function

Your Answer speculative

Multiple Choice Multiple Answer Question Reasons for need of public distribution system

Correct Answer To maintain stable price conditions , An efficient management of the supply , To supply the necessary goods to

people at reasonable price

Your Answer To maintain stable price conditions , An efficient management of the supply , To supply the necessary goods to

people at reasonable price


Question The consumer protection Act includes


protectionYour Answer Protection from hazardous commodities , Right to information regarding protection , Protest against price

discrimination


Question Objectives of economic policy

Correct Answer To increase the efficiency and international competitiveness of industrial production , To improve the performance and rationalize the scope of the public sector , To reform and modernize the financial sector

Your Answer To increase the efficiency and international competitiveness of industrial production , To improve the



Question Scope of Managerial Economics deals with:

Correct Answer Demand analysis and forecasting. , Production function & cost analysis. , Inventory management adverting,

price system.

Your Answer Demand analysis and forecasting. , Production function & cost analysis. , Inventory management adverting, price system.


Question Assumptions 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 Answer Question Types of income elasticity of demand



Select The Blank Question Managerial ________s generally refers to the integration of economic theory with ________ practice.

Correct Answer economic


Correct Answer business

Your Answer business

Select The Blank

Question The problem of unlimited wants and limited ________ with ________ uses has been forever confronting

mankind.

Correct Answer meansYour Answer means

Correct Answer alternative

Your Answer alternative

Select The Blank Question As per the International Labour Organisation (ILO), _ ________ is a ________ association of individuals with

limited income on the basis of equal rights and responsibilities for achieving certa

Correct Answer Co-operation

Your Answer Co-operation

Correct Answer voluntaryYour Answer voluntary

94



Select The Blank

Question Like all organism, the ________ , too is an organism, according to the ________ theory.

Correct Answer firm

Your Answer firmCorrect Answer life-cycle theory

Your Answer homeostatic theory

Select The Blank Question The ________-taking theory was developed by the ________ . According to him, profit arises because


Correct Answer American economist Hawley

Your Answer risk

Correct Answer risk


Select The Blank


determinants remaining constant, is termed as the ________ of demand.

Correct Answer priceYour Answer price



Select The Blank

Question Indices constructed for one ________ should not be ________ for other purposes where they not be fullyappropriate and given erroneous conclusions.

Correct Answer purpose

Your Answer purpose

Correct Answer usedYour Answer used

Select The Blank

Question The 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 Answer increased

Your Answer increased

Correct Answer marginal

Your Answer marginal

Match The Following


Statutory Reserve Ratio Quantitative credit Control Measure Quantitative credit Control Measure

Trade cycle Wave – like movement Wave – like movement

Keynesian theory Short – Period Analysis J. M. Keynes

Aggregate Demand Function Maximum sale proceeds expected by entrepreneurs Short – Period Analysis

Effective Demand J. M. Keynes Maximum sale proceeds expected by entrepreneurs

95



























Question The concept of just distribution of national product is a

Correct Answer normative

Your Answer objective

True/False

Question Resources are said to be involuntarily un employed when their wastage occur.

Correct Answer True

Your Answer True

Match The Following











True/False

96




Correct Answer True

Your Answer False

Multiple Choice Multiple Answer Question Steps in cost benefit analysis



Multiple Choice Multiple Answer Question The advantage of cost-benefit analysis are



Your Answer Maximization of social welfare , Objective measurement of the trade-off , Maximization of difference between


Select The Blank




Select The Blank





Question According to many economists, the root cause of economic problem is

Correct Answer scarcity

Your Answer scarcity






Question In case of a Joint-Stock Company, the liability of share holders is

Correct Answer limitedYour Answer limited


Question For an economist, Tata Eng & Locomotive Company Ltd is a

Correct Answer firmYour Answer firm


Question Preference Shares can be classified as

Correct Answer Simple Shares , Cumulative Shares , Redeemable SharesYour Answer Simple Shares , Cumulative Shares , Redeemable Shares


Question 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 , Prospectus



Question Forms of Public EnterprisesCorrect Answer departmental management , company management or management by boards , public corporations

Your Answer departmental management , public corporations , non-profit organization

Select The Blank

Question Baumol has suggested as an alternative objective for profit maximization , the maximization of ________ Correct Answer sales

Your Answer sales

Select The Blank

Question The partnership between private sector & government is called ________ Correct Answer Joint sector enterprise

97




Select The Blank




Question The profit which is surplus of revenue over and above all paid out cost isCorrect Answer Accounting ProfitYour Answer Gross Profit

True/False





Correct Answer purchasing power Your Answer purchasing power



expansion of



Question Demand for products like tea, betel, tobacoo, sigaratte is a matter of Correct Answer habit

Your Answer habit


Question If the substitutes are relatively cheaper then the demand for the commodity in question will beCorrect Answer less

Your Answer less

True/FalseQuestion A shift in the demand curve to the left shows increase in demand.


Your Answer False

True/FalseQuestion Demand for luxury goods is inelastic


Your Answer False



Your Answer False

Select The Blank Question A normal demand curve has ________+B299



Multiple Choice Multiple Answer Question Cost function denotes

Correct Answer The prices of such inputs as labour and capital material , The rate of output , The size of the plant

Your Answer The 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



Your Answer upward sloping

Select The Blank

98






Select The Blank Question The costs which cover the cost of advertising is ________.



Multiple Choice Multiple Answer Question Features of Oligopoly Market are


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

Multiple Choice Single Answer Question Saving is a

Correct Answer private virtue

Your Answer social virtue

True/FalseQuestion During periods of inflation, the income of farmers as a class decreases.

Correct Answer True

Your Answer False

True/False

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

Your Answer False


Prosperity Expansion of credit Contraction of credit

The general theory of employment, Interest and money J.M. Keynes J.M. Keynes

Trade cycle Wave like movement Wave like movement

Statutory reserve ratioQuantitative credit control measure Quantitative credit control measure


Question The characteristics of Inflation are

Correct Answer Excess of demand , Sustained rise in prices , Cannot be anticipatedYour Answer Sustained rise in prices , Cannot be anticipated , It is limited to some geographical areas

True/False

Question Market system or market economy suffers from time to time from economic depressions.




Correct Answer To unshackle the indian industrial economy from the cobwebs of unnecessary bureaucratic control , Tointroduce liberalization with a view to integrate the indian economy with the world economy , To remove restrictions on direct foreign


Your Answer To unshackle the indian industrial economy from the cobwebs of unnecessary bureaucratic control , To

introduce liberalization with a view to integrate the indian economy with the world economy , To remove restrictions on direct foreign


99




Multiple Choice Single Answer Question In economics the question related to the selection of methods with which commodities are produced is a subject

matter of


Your Answer theory of production



are topics in

Correct Answer theory of distribution

Your Answer theory of distribution


Question In economics the questions related to the dynamic or static ( otherwise) capacity of the economy to produce


Correct Answer theory of economic growth



Question All the free gifts of nature which are commonly called natural resources are known to economists as

Correct Answer LandYour Answer capital


Question All the man made resources which are used in the process of making other goods and services are called

Correct Answer capitalYour Answer labor


Question Managerial economics aims at providing help in the firms isCorrect Answer decision making


True/False

Question Economic problem is faced by poor countrys only.Correct Answer False

Your Answer False


Question An industry is a group of firms dealing in the same line of Correct Answer business


True/False

Question Micro-economics is primarily concerned with the problem of what, how and for whom to produceCorrect Answer True

Your Answer True

True/False

Question Pure public goods must be in the hands of public sector only.Correct Answer True

Your Answer False

Select The Blank

Question The goods become ________ only when each individual has an access to the entire amount of it and its use bythe individual does not reduce its availability to others.


Your Answer public

Select The Blank

100






Your Answer Economic

Select The Blank



Your Answer firm Match The Following



Resources Scarce Scarce

Commodities Goods and services Goods and services

Human wants Unlimited Unlimited

Match The Following






Multiple Choice Multiple Answer Question The characteristics of a sole proprietorship firm is


Your Answer Ownership by a single person , Easy to form


Question Different types of business organizations are

Correct Answer private sector , public sector , joint sector

Your Answer private sector , public sector , joint sector

Select The Blank




Select The Blank





Question Economic Profit takes in to account the

Correct Answer implicit cost


True/False


account

Correct Answer True

Your Answer True




Your Answer Remuneration to factors of production , Depreciation , Maintenance Charges

101




Question reasonable profit' are

Correct Answer Capital Attraction , Plough Back , Normal earnings

Your Answer Capital Attraction , Plough Back , Normal earnings




Your Answer separately Multiple Choice Single Answer

Question Emergence of close substitutes to the commodity in question may bring about demand to




Question The demand for a commodity depends on the prices of its substitutes which are

Correct Answer relative

Your Answer relative

True/False


Correct Answer True

Your Answer True

Select The Blank Question The index numbers which measure the changes in the general price level of a country refers to ________


Your Answer Wholesale prices index






Question If the increase in all factors leads to a less than proportionate increase in output, then the returns to scale are

Correct Answer decreasing

Your Answer decreasing

True/False

Question The supply of factory made goods of daily consumption is inelastic.


Your Answer True


Question Major types of costs are

Correct Answer Accounting costs , Economic costs , Opportunity costs

Your Answer Accounting costs , Economic costs , Opportunity costs

Select The Blank

Question Output rises in a lesser proportion to that of the increase in input, under the case of ________.



Select The Blank

Question If the output rises in the greater proportion than that of the increase in factor inputs, it is referred to as

________.



Question Under monopoly the demand curve slopes

Correct Answer downwardYour Answer downward


Question Dalal Street in Bombay is known as

Correct Answer Bombay Stock ExchangeYour Answer Bombay Stock Exchange

102




Question The city of Banaras has specialized in the manufacture of

Correct Answer silk

Your Answer silk

True/False

Question A firm under perfect competition is a price maker.


True/False



Your Answer True




companyYour Answer It is a business unit organized under one ownership , It is a sole proprietorship , It is a partnership or joint stock

company



Correct Answer maximum satisfaction , balance , stationaryYour Answer maximum satisfaction , balance , stationary

True/False

Question The Keynesian theory emphasizes effective supply as a crucial factor in determining the level of income andemployment.


Your Answer True

Multiple Choice Single Answer Question According to the Government, the buildup of inflationary pressure during the Nineties was attributed to

Correct Answer Higher Fiscal deficit


True/False

Question The government also fixes minimum procurement prices for major crops on the recommendation of the

Agricultural Prices Commission (APC).

Correct Answer True

Your Answer True

True/False


Correct Answer True

Your Answer True




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



Question Defects of market system:Correct Answer Inequalities of income and wealth , Emergence of monopolies , Failure to provide full employment

Your Answer Inequalities of income and wealth , Emergence of monopolies , Failure to provide full employment




services in other words isCorrect Answer a public good , indivisible in character , cannot be priced in the market

103



Your Answer cannot be priced in the market

True/False



Select The Blank

Question Perfectly elastic demand curve is ________ Correct Answer horizontalYour Answer horizontal




True/False



Match The Following


Cost benefit analysis Maximization of net wealth Maximization of net wealth


Unplanned shocks & disturbances Free enterprise system Economic evils

Unemployment, inflation Economic evils Externality tax

Multiple Choice Multiple Answer Question The term externalities may also be referred as:








Question The examples of negative externalities are

Correct Answer nuclear power plants , gargantuan trucks , unsafe factories

Your Answer nuclear power plants , unsafe factories

True/False


Correct Answer True

Your Answer False


Question According to Keynes, Aggregate supply function refers to

Correct Answer the minimum price of revenue which the entrepreneurs must get , Associated with different levels of


Your Answer explains how to minimize the cost of production


Question Substantial reduction in the cost of production of a firm because of the use of improved and up- to –date


Correct Answer technicalYour Answer technical



Correct Answer Gross National Product , National Product , National IncomeYour Answer Gross National Product

104



Select The Blank



Correct Answer divisibleYour Answer divisible


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

unchanged


unchanged

Select The Blank Question Increase in consumer’s income leads in the demand for inferior goods to ________



Multiple Choice Single Answer Question Market mechanism is characterized by


Your Answer instability








True/False


Correct Answer True

Your Answer True




allocated between the various industries , All will get sufficient income to meet their basic needsYour Answer Control the market mechanism by charging license fees, commissions, etc

True/False

Question 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 True

Your Answer True

Select The Blank

Question Cost-Benefit analysis aims at ________ of social wealth.Correct Answer maximization



Question The firm may be defined asCorrect Answer an independently administered business unit , centre where the decisions about what to produce how to produce





Question Goods which are completely divisible and to them the principle of exclusion applies in full measure, are called



Match The Following

105









Select The Blank


Your Answer Baumol



Your Answer particular market for a given commodity

True/False

Question A monopolist can decide both price and the quantity of a product that he is going produce and sell in the market.



Question For an economist, Tata Eng & Locomotive Company Ltd is aCorrect Answer firm

Your Answer firm

Select The Blank



Multiple Choice Single Answer Question When input and output increase in the same proportion, the phase of returns are



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

Correct Answer True

Your Answer True



Your Answer profit

Multiple Choice Multiple Answer Question Investment is significant because


society

Your Answer Addition to the real capital assets , Increases accumulated wealth of the society






Question The market which deals with the all the goods as a whole are considered as

Correct Answer Commodity Market

Your Answer Commodity Market


106







consumption.


Your Answer False Multiple Choice Multiple Answer








True/False



Your Answer False

Select The Blank Question The law of constant returns to scale is depicted by the marginal output curve which is ________.



Select The Blank




True/False



Your Answer False





Select The Blank

Question In the context of formulation of an investment project, ________ feasibility means the availability of land,


Correct Answer technicalYour Answer economic


Multiple Choice Single Answer Question The main objective of a co- operative organization is


Your Answer service

True/FalseQuestion In a market system of an economy procedures are guided by profit motive.

Correct Answer True

Your Answer False


107



Question The method of calculating depreciation in which the actual working hours of a capital asset are taken in to

account is

Correct Answer service unit

Your Answer service unit

True/False




Question The city of Kanpur has developed a big market for

Correct Answer leather goods

Your Answer leather goods


Question Scope of Managerial Economics deals with

Correct Answer Demand analysis and forecasting , Production function & cost analysis , Inventory management adverting, price

system

Your Answer Demand analysis and forecasting , Production function & cost analysis

Select The Blank







Your Answer Simple Shares , Cumulative Shares , Redeemable Shares

True/False

Question A firm is a technical unit of a given capacity of output.


Your Answer True

Select The Blank


Correct Answer Implicit costYour Answer Fixed costs

True/False

Question The federal government of U.S.A. does not face the basic economic problem.



Question Under perfect competition, if demand increases, supply being constant, the price would

Correct Answer riseYour Answer rise




Select The Blank


in case of only those people who do not agree to pay or who cannot pay the market priceCorrect Answer exclusion


Match The Following


P.D.S. Essential commodities Essential commodities

Railway freight rates Administered prices Administered prices

Inflation Deficit f inancing Dual prices

108



R.B.I. General and selective credit control measures General and selective credit control measures

True/FalseQuestion The subject matter of macro – economics includes the theory of income and employment at an individual level.


Your Answer False




Multiple Choice Single Answer Question In economics the question related to the selection of methods with which commodities are produced is a subject

matter of







Your Answer To provide employment to all who willing to work at prevailing wage rate , Factors of production are optimally

allocated between the various industries

Select The Blank

Question On the ________ level, the summation of maximum individual welfare does not automatically lead to

maximum social welfare.Correct Answer macro

Your Answer macro


Question A responsible factor for inflation isCorrect Answer hike in prices


Multiple Choice Multiple Answer Question The consumer protection Act includes


protection

Your Answer Protection from hazardous commodities , Right to information regarding protection


Question According to Lionel Robbins, "Economics is a science which studies


Your Answer economic variables behavior



are topics in



Select The Blank



Your Answer zero

Select The Blank





Question The profit which is surplus of revenue over and above all paid out cost is


Your Answer Gross Profit

109



True/False



Your Answer True






Question The meaning of monetary policy is

Correct Answer It is programmed of the central bank , It controls the total supply of money , The basic objective is to achieve

economic stability

Your Answer It is programmed of the central bank , It controls the total supply of money , The basic objective is to achieveeconomic stability

Select The Blank


Correct Answer Giffen goods, ,Your Answer Giffen goods, ,






Question Keynes’s theory of employment explains

Correct Answer Effective demand , Aggregate supply , Aggregate demandYour Answer Effective demand , Aggregate supply , Aggregate demand

Select The Blank


Correct Answer maximizationYour Answer maximization

True/False

Question Social costs cannot be included in a firm's account book.Correct Answer True

Your Answer True


Question Effective Demand coversCorrect Answer Consumption outlay for the households , Investment outlay in the private sector , Government’s spending for

consumption as well as investment

Your Answer Consumption outlay for the households , Investment outlay in the private sector

Multiple Choice Multiple Answer Question The characteristics of Inflation are


Your Answer Excess of demand , Sustained rise in prices




Your Answer Total product increases at an increasing rate , Marginal product increasing and it is maximum , Average product


Select The Blank








110



Select The Blank



Your Answer public

Match The Following


The speculative motive Liquidity preference Liquidity preference

In contrast to J. M. Keynes, the modern economists define effective demand as C + I + G + (X-M). the modern

economists define effective demand as C + I + G + (X-M).

Keynesian analysis takes a general view of the economic system as a whole. bird's view of the economic system

J. M. Keynes believed in the short run philosophy of life. a general view of the economic system as a whole.



Your Answer Law of variable proportions , Laws of returns to scale

True/False




Question J.M. Keynes, on the basis of a fundamental psychological law of consumption, observed that as incomeincreases, consumption also increases, but proportionately

Correct Answer less

Your Answer less











Question Pure public goods are subject to the law of decreasing average cost, because of the

Correct Answer economies of scale



Question In the cost - benefit analysis, after formulating various alternative project capacity, each of them has to be examined in

terms of its

Correct Answer feasibilityYour Answer feasibility

True/False

Question Bargaining is one of the remedies of corrective action.


Match The Following



111






Multiple Choice Multiple Answer Question The advantage of cost-benefit analysis areCorrect Answer Maximization of social welfare , Objective measurement of the trade-off , Maximization of difference between


Your Answer Maximization of social welfare , Objective measurement of the trade-off , Maximization of difference between total

benefits & total costs


Question The term externalities may also be referred as:



Select The Blank




Select The Blank Question Economists like A.C.Harberger have shown that the cost benefit analysis can be applied to ________ analysis.



Select The Blank

Question In the context of formulating an investment project, ________ feasibility means the availability of supervisors for

implementing and running the project smoothly and professionally.



Select The Blank


Correct Answer negativeYour Answer hazardous



Correct Answer human behavior Your Answer social behavior



Correct Answer Welfare EconomicsYour Answer Business Economics



Correct Answer Integration of economic theory with business practice , Using logic of economics, mathematics & statistics , Theuse 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 use

of economic modes of thought to analyze business solution

Multiple Choice Single Answer Question The public sector is owned & controlled by

Correct Answer state enterprises

Your Answer state enterprises

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



Select The Blank Question “Homeostatic Approach” as an alternative objective of firms was suggested by ________.

112





Select The Blank



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

Your Answer False


Question Complementary goods are demandedCorrect Answer jointly

Your Answer jointly


Question If the substitutes are relatively costly then the demand for the commodity in question will beCorrect Answer more

Your Answer same

True/False



True/False

Question Demand curve slopes downwards from left to right.Correct Answer True

Your Answer True

Select The Blank

Question An upward sloping demand curve is called ________ Correct Answer exceptional demand curve


Select The Blank Question Goods which are paradoxical to the law of demand are ________









Question Explicit costs are



Select The Blank




Select The Blank




113








Question Economists have pointed out that the real world is full of


Your Answer Imperfect competition

True/False



Your Answer False

True/False

Question Under perfect competition single seller can influence the price.


Your Answer False





Multiple Choice Multiple Answer Question Features of Pure Competition are

Correct Answer Large number of buyers and sellers , Homogeneous products , Free entry and free exit of firms




Correct Answer maximum satisfaction , balance , stationary

Your Answer maximum satisfaction , balance



Correct Answer rise

Your Answer rise





True/False

Question During inflation, the pensioners whose income is permanently fixed, are substantially benefited.


Your Answer False

True/False

Question Saving is a private virtue

Correct Answer True

Your Answer True




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 with different levels of employment ,



Question 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 the formula mpc= change in c/change in y

Your Answer It is rate of change in the average propensity to consume as income changes , It is derived by the formula mpc=

change in c/change in y , It is derived by dividing the change in income by change in the consumption expenditure


114




Correct Answer exhausted


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.


Your Answer False

True/False

Question Public enterprises have shown a very high rate of return of the capital invested


Your Answer False




economic stability

Your Answer It is programmed of the central bank , It controls the total supply of money , The basic objective is to achieveeconomic stability




liberalization with a view to integrate the indian economy with the world economy , To remove restrictions on direct foreigninvestment as also to free the domestic entrepreneur from the restriction of MRTP act

Your Answer To unshackle the indian industrial economy from the cobwebs of unnecessary bureaucratic control , To introduce






and rationalize the scope of the public sector , To reform and modernize the financial sector Your Answer To increase the efficiency and international competitiveness of industrial production , To improve the performance



Select The Blank




Question Often monopolies purposely keep certain factors of production idle creating artificial scarcities of their products

as a result the pricesCorrect Answer rise


Question Implicit costs are






Question Market economy or private enterprise economy is a economy which is

Correct Answer planless

True/FalseQuestion While Disinvestments process, Government retains 50% of the equity with itself & transfers 49% to private

sectors


Multiple Choice Single Answer Question Total Revenue - (explicit costs + implicit costs), this equation is used for calculating

115



Correct Answer Pure Profit

True/False



True/False

Question Poverty is the root cause of Economic problem.Correct Answer False





True/False

Question In case of a proprietary firm the liability of the proprietor is limited.


Select The Blank


Correct Answer 2


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

True/False

Question During the period of depression, demand for bank credit reaches its low level and banks experience mounting of their cash balances.

Correct Answer True


Question The main criterion of indivisibility of a good is that the goodCorrect Answer should be equally available to all the members of society. , financing of the good is through public

expenditure. , the principle of exclusion does not apply.

Multiple Choice Multiple Answer Question Types of income elasticity of demand



Question Managerial economics aims at providing guidance to the firms for Correct Answer decision making

Match The Following

Question Correct Answer

Statutory reserve ratioQuantitative credit control measure

Prosperity Expansion of credit

The general theory of employment, Interest and money J.M. Keynes

Trade cycle Wave like movement

Multiple Choice Multiple Answer Question Diseconomies of small scale production includes


techniques of production , Wastage of raw material & power

Multiple Choice Single Answer Question If a person is habituated to the consumption of a commodity and if he cannot easily give up its use, demand for

it is generally


Multiple Choice Single Answer Question The profit which is surplus of revenue over and above all paid out cost is

116






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









Multiple Choice Multiple Answer Question The conditions of equilibrium for a firm are

Correct Answer Marginal revenue should be equal to marginal cost , The marginal cost curve should cut the marginal revenue


True/False

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

Select The Blank



Select The Blank

Question The social costs and benefits are the external economies and diseconomies resulting from the ________ activities, which are known as, "externalities"




True/False

Question It is easy to estimate the amount of black moneyCorrect Answer False

Select The Blank



Match The Following

Question Correct Answer

Implicit costs are the cost of resources owned by the firm.

Opportunity costs are also known as alternative costs

The difference between average total cost &average fixed cost shows variable cost

The difference between average cost and average revenue is average profit

True/False

Question Bargaining is one of the remedies of corrective action.Correct Answer False

Select The Blank



117






Multiple Choice Single Answer Question The public sector is owned & controlled by






Question Managerial economics deals withCorrect Answer Integration of economic theory with business practice , Using logic of economics, mathematics & statistics ,



Question The city of Kashmir has specialized in the manufacture of Correct Answer shawls

Select The Blank


Correct Answer life-cycle theory.

True/False


Correct Answer True



supply him the required quantity of milk. In this example , milk is an

Correct Answer divisible good





Question Market mechanism is characterized by




Select The Blank

Question The costs which cover the cost of advertising is ________.Correct Answer Selling cost



Question Major types of costs are:Correct Answer Accounting costs , Economic Costs , Opportunity Costs

Your Answer Accounting costs , Economic Costs , Opportunity Costs

True/False

Question If demand falls and supply is constant the equilibrium price fallsCorrect Answer True

Your Answer True


Question In general, the demand for necessaries is relativelyCorrect Answer inelastic




118



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

Select The Blank






Correct Answer Supply of goods can be adjusted to the demand to some extent , Some factors can be changed , Supply and demand

determine the price

Your Answer Supply of goods can be adjusted to the demand to some extent , Some factors can be changed , Supply and demand

determine the price



Correct Answer On the basis of economic system , On the basis of motive , On the basis of principle of pricing

Your Answer On the basis of economic system , On the basis of motive , On the basis of principle of pricing

Select The Blank


find out its ________ and facilities its comparison with other available oppor


Your Answer investmentsCorrect Answer worth

Your Answer worth

Select The Blank Question The 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 w

Correct Answer increased

Your Answer increased

Correct Answer marginalYour Answer marginal

Select The Blank

Question The word ________ has different meanings to businessmen, ________ , tax collectors, workers and economists and it isoften used in a loose sense that buries its real significance

Correct Answer Profit

Your Answer Profit

Correct Answer accountants

Your Answer accountants

Select The Blank

Question Nominal cost is the ________ cost of production, it is also called expenses of production. The real cost is the ________

cost of production.

Correct Answer moneyYour Answer money

Correct Answer opportunity

Your Answer opportunity

Select The Blank Question Individual or sole ________ , which is also called sole- ________ , or single entrepreneurship is the most common, the

simplest and the oldest form of business organisation.

Correct Answer proprietorship

Your Answer proprietorship

Correct Answer trader shipYour Answer trader ship

True/False



True/False



119



True/False

Question The externalities or economic effects which flow from the production or use of the goods to other parties or economic

units are termed as ‘neighborhood effects



Question In Capitalism, the sovereign consumers express their preferences throughCorrect Answer price mechanismYour Answer price mechanism


Question If a person is habituated to the consumption of a commodity and if he cannot easily give up its use, demand for it is

generallyCorrect Answer inelastic



Question The main objective of a co- operative organization isCorrect Answer service

Your Answer service


Question The Government attempts to increase supplies of food grains and other essential goods in times of internal shortage

through larger Correct Answer imports

Your Answer imports

Multiple Choice Single Answer Question Supply curve shifts to the right side of the original supply curve when increase in


Your Answer supply

Multiple Choice Multiple Answer Question Features of Perfect Competition

Correct Answer Large number of buyers and sellers , Homogeneous products , Free Entry and Free exit of firms

Your Answer Large number of buyers and sellers , Homogeneous products , Free Entry and Free exit of firms




Your Answer theory of price






Question When is price discrimination possible

Correct Answer In Monopoly Market , In case of Services sold , In case of geographical barriers

Your Answer In case of Services sold , In case of geographical barriers , In case of monopolistic Market

Select The Blank

Question A ________ is an undertaking by a company to repay the borrowed ________ on or before the specified date at a

particular interest rate, irrespective of profit or ;loss made by the company

Correct Answer debenture

Your Answer debentureCorrect Answer money

Your Answer money

Select The Blank

Question The ________ that is ________ is the opportunity cost of the commodity produced.Correct Answer commodity

Your Answer commodity

Correct Answer sacrificed

Your Answer sacrificed

True/False

120



Question Public enterprises may incur some social costs which private enterprise may not bear.

Correct Answer True

Your Answer True

Multiple Choice Multiple Answer Question Objectives of economic policy



Your Answer To increase the efficiency and international competitiveness of industrial production , To improve the performanceand rationalize the scope of the public sector , To reform and modernize the financial sector


Question Important theories of profits are:

Correct Answer Risk taking theory , Uncertainty-Bearing Theory of profit , Dynamic theory of Profit

Your Answer Risk taking theory , Uncertainty-Bearing Theory of profit , Dynamic theory of Profit

True/False

Question The most significant feature of perfect competition is the existence of an automatic price mechanism

Correct Answer True

Your Answer True

True/False



Your Answer False







Correct 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.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 Answer Question In economics demand means desire backed by adequate


Your Answer purchasing power

Multiple Choice Single Answer Question Slope of supply curve is



Select The Blank Question Economics is a ________ , which studies human behaviour as a relationship between ________ , which have alternative

uses.

Correct Answer science

Your Answer science

Correct Answer ends and scarce meansYour Answer ends and scarce means

Select The Blank

Question Consumers protection involves protection from ________ trade practices for the purpose of promoting sales and making

money at the cost of the ________ and well beingCorrect Answer unfair

Your Answer unfair

Correct Answer consumers health

Your Answer consumers health

True/False

Question In the market, any one who agrees to pay the requisite price of a product would be excluded from their consumption


Your Answer True

True/False

121



Question Price effect is the result of in reality substitution

Correct Answer True

Your Answer True

Multiple Choice Single Answer Question An industry is a group of firms dealing in the same line of

Correct Answer business




Your Answer Mounting government expenditure , Deficit financing and increase in money supply , Role of black money





Perfectly elastic demand Horizontal demand curve Horizontal demand curve

Relatively elastic demand Motor cars Motor cars

Increase in demand Upward shift of the demand curve Upward shift of the demand curve

Elasticity Degree of responriness. Degree of responriness.

Unitary elastic demand Unchanged total outlay Unchanged total outlay



Question Features of Pure Competition are

Correct Answer Large number of buyers and sellers , Homogeneous products , Free entry and free exit of firmsYour Answer Large number of buyers and sellers , Homogeneous products , Free entry and free exit of firms


Question Methods of measurement of elasticity are

Correct Answer Percentage method , Point elasticity method , Total outlay expenditure methodYour Answer Percentage method , Point elasticity method , Total outlay expenditure method




True/False





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



Select The Blank Question The partnership between private sector & government is called ________



Multiple Choice Multiple Answer Question The subject matter of Micro economics includes the study of

122




Your Answer an individual consumer , particular market for a given commodity

Select The Blank

Question The persons who own the ________hip concern are called Partners.Correct Answer Partners


Select The Blank Question While discussing the product divisibility of public and private goods, the principle of ________ may be applied






Your Answer service

Multiple Choice Single Answer Question With technological advances, with the given inputs, the flow of output



True/False

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

Your Answer True

Multiple Choice Single Answer Question In the Long run perfect competition and monopolistic competition the firm make profits which are


Your Answer normal

Multiple Choice Multiple Answer Question Phases of business cycle

Correct Answer Expansion , Peak , Recession



Question In case of perfectly elastic supply, the supply curve is


Your Answer hyperbola





Select The Blank




Select The Blank








True/False



Your Answer False

Match The Following

123












Select The Blank








Match The Following








Question All firms producing the homogenous or similar products together make






Your Answer National Income




Correct Answer divisible goodYour Answer divisible good



Correct Answer Demand analysis and forecasting , Production function & cost analysis , Inventory management adverting, pricesystem


system

Multiple Choice Single Answer Question The number of buyers & sellers operating under perfect competition is


Your Answer large


124





True/False

Question Measurement of profit becomes difficult because of the difficulty involved in the calculation of depreciation.Correct Answer True

Your Answer True

Multiple Choice Single Answer Question Economic Profit takes in to account theCorrect Answer implicit cost


True/False

Question The supply curve slopes downwards from left to right.Correct Answer False

Your Answer False

Select The Blank







Multiple Choice Multiple Answer Question Characteristics of the phase of Recession are


Your Answer Negative multiplier gets underway , Inventories pile up




True/False


Correct Answer True

Your Answer True





True/False


Correct Answer True

Your Answer True

Select The Blank

Question The social costs and benefits are the external economies and diseconomies resulting from the ________

activities, which are known as, "externalities"


Your Answer firm's




Your Answer monopolistic market , personnel services sold , geographical barriers

True/False


Correct Answer True

Your Answer True

125



True/False



Your Answer False


Question The Government attempts to increase supplies of food grains and other essential goods in times of internal

shortage through larger

Correct Answer importsYour Answer imports

Select The Blank



























Question In economics the question related to the selection of methods with which commodities are produced is a subject

matter of Correct Answer theory of production


True/False

Question Economic problem is faced by poor countrys only.Correct Answer False

Your Answer False

Match The Following




Commodities goods and services J. M. Keynes

126





True/False




Question A joint stock company is owned by its share holders but it is managed by



True/False




True/False

Question The registration of a partnership firm is voluntary.

Correct Answer True

Your Answer True

True/False

Question In case of sole proprietorship the owner and organization are same.


True/False

Question The Joint- sector is a form of partnership between the private sector and the government.



Question In addition to the consumption and investment expenditure as in the original keynesian theory of employment,the modern economists give due recognition to the government expenditure as an important fa

Correct Answer Effective demand

Your Answer social

Multiple Choice Single Answer Question In Trade cycles the economic activity are

Correct Answer ups and downs


Multiple Choice Single Answer Question Inflation is a phenomena of in which prices

Correct Answer rises

Your Answer rises

True/FalseQuestion Market system or market economy suffers from time to time from economic depressions

Correct Answer True

Your Answer True

Multiple Choice Single Answer Question According J.B.Clark, profit is the reward paid for



True/FalseQuestion While calculating economic profit, only explicit costs are considered.


Your Answer False

Multiple Choice Single Answer Question Emergence of close substitutes to the commodity in question may bring about demand to

127






Question Change in income of a person may bring about in demand for goods.Correct Answer change

Your Answer change

Multiple Choice Single Answer Question If a person is habituated to the consumption of a commodity and if he cannot easily give up its use, demand for

it is generally





Your Answer False




Perfectly Elastic Demand E.D. =infinity E.D. =infinity

Unchanged total outlay E.D. = 1 E.D. = 1



Question The government of India follows administered price policy in respect of commodities which are vital and produced in the public sector

Correct Answer Public sector

Your Answer Free market


Question Substantial reduction in the cost of production of a firm because of the use of improved and up- to –date




True/False

Question Marginal Cost (M.C.) is the rate of change of fixed cost.


Your Answer False


Question Long –run market


recover minimum price for their goodsYour Answer It is durable goods market , Supply can be increased or reduced according to the demand , Sellers at least



Question Conditions of Price Discrimination are:Correct Answer The two markets in which the product is sold should be kept separate , The elasticity of demand in different






Correct Answer The price is set to cover Material, labour cost , Actual costs, standard costs are included , Certain percentage of


Your Answer The price is set to cover Material, labour cost , Actual costs, standard costs are included , Certain percentage of profit also included

128



Select The Blank

Question According to Keynes, the ________ between the aggregate demand function and the aggregate supply function

can , and often does, take place at a point ________

Correct Answer equilibriumYour Answer imbalance



Multiple Choice Multiple Answer Question Defects of market system

Correct Answer Inequalities of Income and wealth , Emergence of monopolies , Failure to provide full employment

Your Answer Inequalities of Income and wealth , Emergence of monopolies , Failure to provide full employment

Multiple Choice Multiple Answer Question Features of public sector enterprises

Correct Answer It is controlled by the state. , Separate funds to undertake their activity. , They are accountable to public.

Your Answer It is controlled by the state. , Separate funds to undertake their activity. , They are accountable to public. ,

Unprofitable motive.



Correct Answer Elasticity of demand for good X , Price of good X , Income of the consumer

Your Answer Elasticity of demand for good X , Price of good X

Multiple Choice Multiple Answer Question Different types of Elasticity of Demand are:

Correct Answer Price elasticity of demand , Income elasticity of Demand , Cross Elasticity of Demand

Your Answer Price elasticity of demand , Income elasticity of Demand , Cross Elasticity of Demand


Question Forecasts can be made at the level of

Correct Answer A firm , An Industry , The Nation

Your Answer A firm , A Consumer


Question Diseconomies of small -Scale Production includes:


techniques of production. , In the initial stages production is on small scaleYour Answer High average cost of production in initial stages , Workers in the factory take some time to adjust with new

techniques of production. , In the initial stages production is on small scale


Question Determinants of supply:Correct Answer Is always referred to in relation to price and time , The ability of a seller to supply a commodity , The seller


Your Answer Is always referred to in relation to price and time , The ability of a seller to supply a commodity , The seller


Select The Blank

Question The Indian partnership Act, ________ , defines the partnership as "the relation between two or more ________

who have agreed to share profits of a business carried on by all or any one of them act

Correct Answer 1932

Your Answer 1932Correct Answer persons

Your Answer persons

Select The Blank

Question Minimum ________ persons have to come together to start a joint-stock company. Those who take initiative tostart it are called ________ .

Correct Answer seven

Your Answer seven

Correct Answer promoters

Your Answer promoters

Select The Blank

Question A ________ is an undertaking by a company to repay the borrowed ________ on or before the specified date at

a particular interest rate, irrespective of profit or ;loss made by the company

Correct Answer debentureYour Answer debenture

129



Correct Answer money

Your Answer money

Select The Blank

Question The joint sector is a form of ________ between the ________ and the government.Correct Answer partnership

Your Answer partnership

Correct Answer private sector

Your Answer private sector Select The Blank

Question Other things being equal, the higher ________ of commodity, the smaller is the quantity ________ and lower

the price , larger is the quantity demanded.


Your Answer priceCorrect Answer price

Your Answer demanded

Select The Blank

Question The production function is the name given to the ________ between the rates of ________ of productiveservices and rate of output of a product


Your Answer relationship


Your Answer input

Select The Blank

Question Costs may be classified as : (a) ________ , including material costs, wage cost and interest cost (b) ________ ,


Correct Answer Production costsYour Answer Production costs

Correct Answer Selling costs



















Multiple Choice Single Answer Question The things that are produced by factors of production are called




130








Match The Following










Correct Answer plantYour Answer plant


Question In the cost – benefit analysis, after formulating various alternative project capacity, each of them has to be

examined in terms of itsCorrect Answer feasibility


Multiple Choice Single Answer Question Joint Stock Company succession is




consumption


Your Answer False






True/False

Question The prosperity phase is characterized by rise in the national output

Correct Answer True

Your Answer True

True/False

Question Inflation is a sustained and appreciable rise in prices

Correct Answer True

Your Answer True





131








Question Depreciation is the value caused by the continuous use of a capital asset is

Correct Answer loss

Your Answer loss True/False


account.

Correct Answer True

Your Answer True




Your Answer change




Your Answer future

True/False



Your Answer False

True/False


Correct Answer True

Your Answer False

Select The Blank





Multiple Choice Single Answer Question Costs which increase because of the expansion of a firm are called costs



True/FalseQuestion Contraction of supply is traced by the downward movement on the supply curve.

Correct Answer True

Your Answer True



Correct Answer True

Your Answer True

True/False



Your Answer True


Question In short run period



Your Answer Supply of goods can be adjusted to the demand to some extent , Some factors can be changed , Supply anddemand determine the price

132



True/False


Correct Answer True

Your Answer True



Correct Answer Is a group of firms , All firms dealing in the same line of business , The ownership and management of eachfirm is different


firm is different

Select The Blank

Question Under monopoly, there is ________ seller who controls the entire ________ in the marketCorrect Answer only one



Your Answer supply

Select The Blank




Correct Answer few firms

Your Answer few firms

Select The Blank


private and find out its ________ and facilities its comparison with other available oppor Correct Answer investments



Your Answer worth




economy , Study of aggregate demand and aggregate supplyYour Answer Study of aggregate demand and aggregate supply



Correct Answer Decrease in economic activities , The growth rate becomes negative , The level of national income declinesrapidly


rapidly




Your Answer company







Correct Answer An independently administered business unit. , A center of where the decisions about what to produce how to produce are taken , A business unit, which hires resources for production.

Your Answer An independently administered business unit. , A center of where the decisions about what to produce how to



133



Correct Answer Giffen Goods , Articles of snob Appeal , Speculation





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






Select The Blank

Question The ________-taking theory was developed by the ________ . According to him, profit arises because


Correct Answer American economist HawleyYour Answer risk

Correct Answer risk


Select The Blank

Question A tabular statement of ________ relationship is known as the ________ schedule, there are two types of demand schedules: (1) the individual demand schedule, and (ii) the market demand schedule


Your Answer Price-quantity


Select The Blank


determinants remaining constant, is termed as the ________ of demand.Correct Answer price

Your Answer price



Select The Blank




Your Answer changes

Select The Blank

Question The money payment, which a firm makes to those ________ who supply labour services, raw materials,transport services, electricity etc. are called ________ costs.





LIST OF ATTEMPTED QUESTIONS AND ANSWERS ME1

Question In India, the first phase of economic reforms is believed to have begun in 1985 when Vishwanath Pratap Singh was the

Prime Minister of the country.Correct Answer False

Your Answer False


Correct Answer public utilities with legal sanction , personnel services sold , geographical barriersYour Answer public utilities with legal sanction , personnel services sold , geographical barriers




134




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


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

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


Your Answer True




Correct Answer 3

Your Answer 3

Question The factors of production are

Correct Answer Labour , Land , Capital

Your Answer Labour , Land , Profit

Question Economists have pointed out that the real world is full of


Your Answer Monopolistic competition

Question According to J.M. Keynes, the equilibrium between the aggregate demand function and the aggregate supply functioncan, and often does take place at


Your Answer full employment

Question Important theories of profits are

Correct Answer Uncertainty-bearing theory of profit , Dynamic theory of profit , Life cycle theory





Correct 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)






Correct Answer Bombay Stock Exchange




Question Preference share holders get a rate of dividend which is

Correct Answer fixedYour Answer high

135






Question Contraction of supply is traced by the downward movement on the supply curve

Correct Answer True

Your Answer True


Your Answer sales

Match The Following







Question In the traditional concept of equilibrium, a firm attains the equilibrium when the firm’s Total Revenue (T.R.) =Total Cost

(T.C.).


Your Answer True





Question In economics, supply is considered to be a

Correct Answer relative termYour Answer relative term

Question In economics the question related to the selection of methods with which commodities are produced is a subject matter of









Question Steps in cost benefit analysisCorrect Answer Identification of a project , Formulation of the project , Appraisal and selection of the project


Question Slope of supply curve is

Correct Answer positiveYour Answer positive







Question We say that a nation faces economic problems , under following conditions

136



Correct Answer Man has unlimited wants or ends , The means or resources to satisfy them are limited , These resources are not




Question A shift in the demand curve to the left shows increase in demand.


Your Answer False


Your Answer True

Question A Joint- Stock Company is owned by its share holders but it is managed by

Correct Answer Board of DirectorsYour Answer Non-government organization



Your Answer joint




Question The supply curve slopes downwards from left to right.Correct Answer False

Your Answer False

Question Poverty is the root cause of Economic problem.Correct Answer False

Your Answer False


all its citizen’s wants areCorrect Answer insufficient


Question In case of a proprietory firm, the liability for all his debts isCorrect Answer unlimited





Correct Answer Law of Increasing Returns to Scale , Law of Constant Returns to Scale , Law of Decreasing Returns to scale





Question The registration of a partnership firm is voluntary

Correct Answer True

Your Answer True


Question A responsible factor for inflation is



Question Economists call all human resources as

Correct Answer labor

Your Answer labor

Question The wage and salary earners who get fixed income in terms of money are benefited during inflation.Correct Answer False

137



Your Answer False




Question Given the price, if the cost of production increases because of higher price of raw materials, the supply




Correct Answer capital

Your Answer capital


Your Answer False

Question Inflation is characterized by excess of demand.






Correct Answer True

Your Answer False





Your Answer To unshackle the indian industrial economy from the cobwebs of unnecessary bureaucratic control , To introduceliberalization with a view to integrate the indian economy with the world economy , To remove restrictions on direct foreign


Question Free riders' is a term associated with the people who would like to have benefit of a good without sharing the cost of itssupply.

Correct Answer True

Your Answer True




Correct Answer PartnersYour Answer Partners


Correct Answer 2

Your Answer 2

Question Generally, the larger the income of a consumer, his demand for overall commodities tends to be relatively elastic.


Your Answer True







138







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 upward sloping 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.


find out its worth.





Your Answer output

Question An individual consumer or particular market for a given commodity are the subject matter 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 are

Correct Answer Changes in the supply of capital , Changes in population , Changes in the techniques of productionYour Answer Changes in the supply of capital , Changes in population , Changes in the techniques of production





Correct Answer EmploymentYour Answer Employment


Correct Answer Land

Your Answer Land




Your Answer To maintain stable price conditions , To bring an efficient management of the supply , To supply the necessary goodsto people at reasonable price




Question The important determinants of supply are

Correct Answer Always referred to in relation to price & time , Government policy , Availability of factors of production

Your 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 and services among its members are topics

in






Question In case of the co-operative societies supplying cheap inputs or supplying consumer products at fair prices, a system of subsidized pricing is followed.

139



Correct Answer True

Your Answer False

Question During periods of inflation, the income of farmers as a class decreases.


Question By ' profits', the accountant means total revenue minus________.

Correct Answer Explicit costsYour Answer Sunk cost







Question According to the Government, the buildup of inflationary pressure during the Nineties was attributed toCorrect Answer Higher Fiscal deficit


Question In economics the questions related to the dynamic or static ( otherwise) capacity of the economy to produce goods and

services are topics in the

Correct Answer theory of economic growthYour Answer theory of economic growth


Correct Answer Total product increases at an increasing rate , Marginal product increasing and it is maximum , Average product isincreasing but it is below MP

Your Answer Total product increases at an increasing rate , Marginal product increasing and it is maximum , 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 the entrepreneur's own investment


Question Characteristics of the phase of Depression areCorrect Answer Decrease in economic activities , The growth rate becomes negative , The level of national income declines rapidly

Your 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 resources





Question Break-Even analysis is derived by

Correct Answer Fixed cost , Average variable cost , Quantity of goods and price

Your Answer Fixed cost , Average variable cost , Quantity of goods and price








machinery, raw materials and technical know how etc.Correct Answer technical

Your Answer infrastructure

Question Scarcity of resources is the root cause of economic problem.


140




Correct Answer True

Your Answer True







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 Social costs cannot be included in a firm's account book.Correct Answer True

Your Answer False

Question Economic problem arises only in case of an overpopulated country.




Question The question regarding the nature and quantities of commodities to be produced is solely restricted to capitalist

economies.




Your Answer False



Your Answer False


Correct Answer forward Planning

Your 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 the demand curve


Extension of demand Downward movement on the demand curve Downward movement on the demand curve

Question The promoters of a company can get incorporated by filing with the registrarof companies various documents such as

141




Your Answer Articles of Association , Prospectus


Correct 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 are accountable to public


Correct 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 , Demand for production






Your Answer public


Your Answer perfect



Your Answer profit





Correct Answer Fulfillment of objective of the plans , Preparation of a budget , Expansion of firms

Your 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 True

Your Answer True


Correct Answer All firms dealing in the same line of business , The ownership and management of each firm is different , Is a group

of firms

Your 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 is



Question Normally, a larger quantity is demanded at

Correct Answer lower price

Your Answer lower price

Question When a company rasies additional finance by borrowing from the public for a specific period of time at a particular rateof interest, it is called as

Correct Answer Debentures

Your Answer Debentures

Question In cost benefit analysis, in the valuation of costs and benefits, for finding the present value, one has to make use of Correct Answer discount rate



The city acquire the status of aCorrect Answer national market

Your Answer capital market


Correct Answer registered or authorized capital , issued capital , paid-up capitalYour Answer registered or authorized capital , issued capital , paid-up capital

142









Question Cournot' , the economists who defined the term 'market' different from that of the traditional sense is anCorrect Answer French economists

Your Answer French economists

Question Demand forecasting is predicting for the demand of a firm’s product in

Correct Answer futureYour Answer future

Question Pure inflation starts only after reaching the full employment level.

Correct Answer True

Your Answer True


Correct Answer True

Your Answer True

Question The demand curve (A.R.) of a firm under perfect competition isCorrect Answer perfectly elastic


Question Managerial economics aims at providing guidance to the firms for Correct Answer decision making


Question In 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 good

Your 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 True

Your Answer True

Question The subject matter of macro - economics includes the theory of income and employment at an individual level.



Multiple Choice Multiple Answer Question Types of Share capital of Joint-Stock Company are






Tea and sugar Complimentary goods Complimentary goods

Excess demand can be defined as quantity demanded minus quantity supplied quantity demanded minus quantity supplied





143







Select The Blank



Your Answer limited

Select The Blank









Question Features of Long -run market are



Your Answer It is durable goods market , Supply can be increased or reduced according to the demand , Sellers at least recover





Select The Blank




Question An individual consumer or particular market for a given commodity are the subject matter of Correct Answer Micro Economics

Your Answer Micro Economics

Select The Blank




Question While calculating accounting profit, the costs which are considered are by natureCorrect Answer explicit

Your Answer implicit


Question Given the price, if the cost of production increases because of higher price of raw materials, the supplyCorrect Answer decreases







Your Answer normative


Question In economics the question related to the selection of methods with which commodities are produced is a subject matter of Correct Answer theory of production

144




True/False


subsidized pricing is followed.Correct Answer True

Your Answer True

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



Question The market system of economy is based on the following foundations:Correct Answer Consumer's Sovereignty , Non-interference by the state. , Private Profit Motive

Your Answer Consumer's Sovereignty , Private Profit Motive , Existence of monopoly

Select The Blank


Your Answer private

Select The Blank


individual does not reduce its availability to others.Correct Answer indivisible

Your Answer public

Multiple Choice Single Answer Question 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 substantially benefited.


Your Answer False

Select The Blank




True/False

Question Generally, the larger the income of a consumer, his demand for overall commodities tends to be relatively elastic.


Your Answer False



in



True/False

Question Supply management is related to the volume ofsupply & its distribution system.

Correct Answer True

Your Answer True

Select The Blank







Correct Answer insufficientYour Answer insufficient

145



True/False

Question Under the disinvestments process, there is full transfer of ownership

Correct Answer True

Your Answer False



Correct Answer comparison of the cash flowYour Answer comparison of the cash flow



interest, it is called as

Correct Answer DebenturesYour Answer Debentures


Question Features of market period are

Correct Answer Related to few hours or few days , Related to perishable goods , The entire supply is to be disposed off on the sameday

Your Answer Related to few hours or few days , Related to perishable goods , The entire supply is to be disposed off on the same

day

Select The Blank

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







Your Answer Total product increases at an increasing rate , Marginal product increasing and it is maximum , Average product isincreasing but it is below MP





Question Scope of Managerial Economics deals withCorrect Answer Demand analysis and forecasting , Production function & cost analysis , Inventory management adverting, price

system


system


Question The observation of economic histories of the United States & West European countries shows that competition , the heart

of market mechanism gives rise to

Correct Answer monopolies

Your Answer price competition

Match The Following


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


Question During a period of rising prices (inflation), the goods and services areCorrect Answer scarce

146



Your Answer are also increasing

True/False




Question 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.


True/False

Question Demand is related to price, time and place.






Select The Blank


Correct Answer expandYour Answer expand


True/FalseQuestion Macro economic studies are based on empirical evidence.

Correct Answer True

Your Answer True

Select The Blank

Question According to the World Bank's approach, the trade able items would be valued at the corresponding world prices and the

non-trade able items at the ________.

Correct Answer shadow prices

Your Answer market prices






Question Costs which increase because of the expansion of a firm are called



True/False

Question In the Long- run, supply of goods can be adjusted to the demand and therefore supply curve is horizontal to the X-axis.


Your Answer True

Select The Blank





Question Features of short run period are

Correct Answer Supply of goods can be adjusted to the demand to some extent , Supply and demand determine the price , Some

factors can be changed

147



Your Answer Supply of goods can be adjusted to the demand to some extent , Supply and demand determine the price , Some


Select The Blank

Question The law of constant returns to scale is depicted by the marginal output curve which is ________.Correct Answer horizontal


Multiple Choice Single Answer Question The method of calculating depreciation in which the actual working hours of a capital asset are taken in to account isCorrect Answer service unit


True/False

Question Demand curve slopes upwards from left to right.Correct Answer False

Your Answer False


Question All the free gifts of nature which are commonly called natural resources are known to economists asCorrect Answer Land

Your Answer Land

True/False




Question The assumption of perfect competition in all the analytical theories is made byCorrect Answer Classical economists

Your Answer Keynesian economists

Select The Blank

Question In the 3rd stage of operation of the law of variable proportions, the marginal product becomes ________.Correct Answer negative


Multiple Choice Multiple Answer Question Reasons for need of public distribution system are



Your Answer To maintain stable price conditions , To bring an efficient management of the supply , 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 includes

Correct Answer wages , rent , interestYour Answer wages , rent , interest



Correct 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


Question The method of inventory valuation in which , the cost of production is calculated on the assumption that the material

which was last to enter the inventory of the company was used first isCorrect Answer LIFO

Your Answer LIFO

Select The Blank

Question A private limited company can be formed with 2 to 50 members maximum, excluding ________ Correct Answer employee shareholders

148





Question The number of sellers operating under monopolistic competition as compare to oligopoly is

Correct Answer larger Your Answer larger


Question Causes for rise in prices in IndiaCorrect Answer Mounting government expenditure , Deficit financing and increase in money supply , Role of black moneyYour Answer Mounting government expenditure , Deficit financing and increase in money supply , Increase in demand

True/False




Question AVC is the per unit variable cost of

Correct Answer productionYour Answer total revenue





Question In the cost - benefit analysis, the first step involved is that the investor has to choose a few project alternatives promising

a

Correct Answer high rate of returnYour Answer high rate of return






Your Answer False

Match The Following


Pure 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 , Oligopoly






societyYour Answer Addition to the real capital assets , It leads to increase in level of income , Increases accumulated wealth of the

society


Correct Answer socialYour Answer social

149









Question A firm gets an opportunity to produce multiple products because changes in business activity in a firms isCorrect Answer cyclical

Your Answer rapid




Correct Answer full employment

Your Answer optimum produce



Your Answer True

Question Factors influencing selling costs areCorrect Answer Type of product , Introduction of new goods , Technology changes

Your 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 , Availability of factors of production


Question The slope of Supply curve of labour is always

Correct Answer backwardYour Answer upward


services are topics in theCorrect Answer theory of economic growth

Your Answer theory of economic growth


Correct 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 True

Your Answer True

Match The Following








Your Answer False

LIST OF ATTEMPTED QUESTIONS AND ANSWERS KME3

150



True/False

Question The damage being done by the factories at and around Agra to Taj Mahal is an example of social cost for private benefit.

Correct Answer True

Your Answer True


Question The Risk theory of profit was developed by

Correct Answer HawleyYour Answer Hawley


Question Index numbers may broadly be classified as

Correct Answer Price indices , Quantity indices , Special purpose indices

Your Answer Price indices , Quantity indices , Special purpose indices


Question Expansion of supply is shown by the movement in the supply curve which is

Correct Answer upward

Your Answer upward



Correct Answer departmental management , company management or management by boards , public corporations

Your Answer departmental management , company management or management by boards , public corporations

Select The Blank



Your Answer public







Correct Answer nuclear power plants , gargantuan trucks , unsafe factoriesYour Answer nuclear power plants , gargantuan trucks , unsafe factories

Match The Following


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







True/FalseQuestion A monopolist in a price maker.

Correct Answer True

Your Answer True

Select The Blank

151



Question The chemical effluents recklessly released by a chemical factory in the river causing water pollution, is an example of

________ cost.



True/False

Question The financing of the pure public goods has to be through public expenditure and not through market pricing.

Correct Answer True

Your Answer True


Question A firm is a unit of production, where production is done with the aim to maximize

Correct Answer profits

Your Answer profits

Select The Blank





Question Cost-Benefit Analysis is



Your Answer The analysis undertaken to judge the investment of any project , Refers to finding out the worth of investment ,


True/False





Correct Answer a lot of sufferings to the people near the railway. , cost to the society. , no cost to the railways.Your Answer a lot of sufferings to the people near the railway. , cost to the society. , no cost to the railways.


Question All the buyers and sellers operating under perfect competition have knowledgeCorrect Answer perfect

Your Answer perfect


Question Marginal cost pricing explains that theCorrect Answer Price charged should be equal to the marginal cost , Cost price sets the lower limits for firm’s price , Cost price


Your Answer Price charged should be equal to the marginal cost , Cost price sets the lower limits for firm’s price , Cost price


True/False


economies.


Your Answer False

Match The Following






True/False

Question During the period of depression, a large part of a country’s resources lie involuntarily idle.Correct Answer True

152



Your Answer True


Question The demand curve (A.R.) of a firm under perfect competition is

Correct Answer perfectly elasticYour Answer perfectly elastic

Select The Blank

Question The externality which causes an economic gain or an economic loss to other economic units is also referred to as ________ externality.


Your 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 cannot pay the market price



Select The Blank Question Under the decreasing returns to scale, the marginal output curve slopes ________.




Question Characteristics of Pure Public goods are:Correct Answer They are completely indivisible , Their marginal cost would be zero or close to zero , Their benefits cannot be

priced

Your Answer They are completely indivisible , Their marginal cost would be zero or close to zero , Their benefits cannot be priced


Question Major types of costs are



True/False


Correct Answer True

Your Answer True

True/False

Question Cyclical fluctuations are recurrent in nature

Correct Answer True

Your Answer True


Question Quantitative credit control measures are


Your Answer open market operations , changes in statutory reserve ratio

True/False

Question Private profit motive is an essential feature of Capitalism.

Correct Answer True

Your Answer True




Your Answer large

Select The Blank

Question The sum of all individual demands constitutes________



Select The Blank




153




Question The relation between variable input and ouput

Correct Answer is direct

Your Answer is direct


Question With decline in price of a commodity, total expenditure spent on the commodity is less than before, then elasticity of

demand for the commodity is

Correct Answer < 1Your Answer < 1





True/False



Your Answer False


Question A downward movement from one point to another point on the same demand curve implies

Correct Answer expansion

Your Answer expansion





True/False

Question The concept of economic profit differs from that of normal profit.


Your Answer True

Select The Blank





Correct Answer excess of supplyYour Answer surplus

Select The Blank


Correct Answer indivisibleYour Answer public















154







Match The Following













True/False

Question Pure private goods are completely divisible and to them the principle of exclusion applies in full measure.Correct Answer True

Your Answer True

Multiple Choice Multiple Answer Question Cost-Benefit Analysis is



Your Answer The analysis undertaken to judge the investment of any project , Refers to finding out the worth of investment


Question Characteristics of Pure Public goods are:

Correct Answer They are completely indivisible , Their marginal cost would be zero or close to zero , Their benefits cannot be

priced

Your Answer They are completely indivisible , Their benefits cannot be priced

Select The Blank




Select The Blank



Correct Answer technicalYour Answer economic

Select The Blank


Correct Answer negativeYour Answer hazardous


Question The suggestion of reasonable profit target as an alternative to the objective of profit maximization is by


155




Question Public corporations are managed by the board of directors appointed by

Correct Answer Government

Your Answer Government

True/False

Question In case of a Joint Stock Company the liability of the share holders is unlimited.


True/False

Question There is no separation of ownership and management in case of a Joint Stock Company


Your Answer True




Your Answer registered or authorized capital , issued capital , cumulative share capital





Select The Blank



Your Answer life-cycle theory.


Question The income which a businessman might expect from the second best alternative use of his resources is called as

Correct Answer opportunity cost

Your Answer opportunity cost


Question Peas & beas, groundnut oil & til oil, tea & coffee are examples of

Correct Answer substitutes goodsYour Answer neccesary goods


Question The demand for a commodity depends on the prices of its substitutes which are

Correct Answer relativeYour Answer relative

True/False



Select The Blank



Select The Blank


Correct Answer market demandYour Answer market demand

Select The Blank


Correct Answer decreaseYour Answer increase




156



Select The Blank



Your Answer demand

Select The Blank



Select The Blank







Your Answer elastic

True/False


Correct Answer True

Your Answer False

True/False

Question If demand falls and supply is constant the equilibrium price falls.

Correct Answer True

Your Answer False





True/False


consumption.Correct Answer True

Your Answer False




Your Answer Determines the level of income and output in an economy , Is total expenditure equal to total income in an



Question Features of stage of expansion in business cycle are

Correct Answer Rise in national output , Rise in consumer and capital expenditure , Bank advances grow rapidly

Your Answer Rise in national output , Rise in consumer and capital expenditure , Bank advances grow rapidly , Contraction

of credit


Question Characteristics of the phase of Recession are


Your Answer Investments decline , Negative multiplier gets underway , Inventories pile up


Question Under the system of dual prices adopted by the Government for essential goods, the weaker sections of the

community are supplied those goods through fair price shops which are

Correct Answer fair Your Answer fair



Correct Answer less than full employmentYour Answer less than full employment

157



True/False

Question Under the New Industrial Policy, Public enterprises which are chronically sick and which are unlikely to be

turned were referred to BIFR


True/False

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

True/False

Question Supply management is related to the volume ofsupply & its distribution system.




Correct 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




economic stabilityYour Answer It controls the total supply of money , The basic objective is to achieve economic stability , It controls the public

expenditure

Multiple Choice Multiple Answer Question The disinvestments of industries is needed for



Multiple Choice Multiple Answer Question Important theories of profits are

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




Question Who said, “Management is management of Men, Money, Machinery Materials and Information?”

Correct Answer Anonymous

Your Answer Anonymous


Question Who said, “Management is the creation and maintenance of internal environment in an enterprise, where individuals

working in groups can perform efficiently and effectively towards the attainment of gr

Correct Answer Koontz & O ‘Donell

Your Answer Koontz & O ‘Donell


Question Who said, “Management is a multiple organ that manages a business, manages a manager and manages workers and

work”?

Correct Answer Peter Drucker Your Answer Peter Drucker


Question One of the external environment factors that influences Management is

Correct Answer LegalYour Answer Legal

Match The Following


Management is a multipurpose organ That manages a business Has no centralized rule-making authority

158



Management is understood by performance Management is what management does Management is what management does

Management requires learning Art requires knowledge Art requires knowledge

Science is developed Over a period of time Over a period of time

Management as a discipline Has no centralized rule-making authority That manages a business

True/False

Question Professional management signifies separation of ownership and management.

Correct Answer True

Your Answer True

Select The Blank

Question Management is a creative and________process.

Correct Answer continuous

Your Answer continuous

True/False

Question Fast food chains are not a corporatised service.


Your Answer False

Multiple Choice Single Answer Question Services need support functions to assist its operation, they are

Correct Answer transport, telecom, power

Your Answer transport, telecom, power


Question How many event management companies are there in Pune?

Correct Answer 215

Your Answer 215


Question Allianz AG has collaborated with which Indian partner?

Correct Answer BAJAJ

Your Answer TATA


Question What is to be done to all functions of insurance such as marketing, finance etc so that the balance is achieved in

insurance?

Correct Answer co-ordinatingYour Answer co-ordinating

Select The Blank

Question Disclosures should provide________and relevant data to shareholders.

Correct Answer transparentYour Answer transparent

Select The Blank

Question The directors should show________and commitment to their job.

Correct Answer interestYour Answer determination


Question The important point to be noted under the definition of learning organizations is

Correct Answer Development of collective as well as individual learningYour Answer Development of collective as well as individual learning


Question What is the authority for the SBU which is delegated to each person heading it, and can adapt quickly to any

environmental change?Correct Answer Decision-making

Your Answer Co-ordination


Question An SBU is an independent business with a coherent set of Correct Answer products , competitors , objectives

159



Your Answer products , competitors , objectives


Question Who is the father of Intelligence Quotient ?

Correct Answer Alfred BennetYour Answer Alfred Bennet

True/False

Question Lower level managers need EQ most.Correct Answer FalseYour Answer False

True/False

Question Emotional distress shrinks working memory.


Select The Blank

Question ________ is the reason for the rising importance of empathy for business leaders.

Correct Answer GlobalisationYour Answer Entrepreneurship


Question Some of the management functions mentioned by Henry Fayol are :

Correct Answer Planning , Control , Co-ordination

Your Answer Planning , Control , Co-ordination


Question The factors coming under philosophy of scientific management are:

Correct Answer Co-operation , Maximum output , HarmonyYour Answer Co-operation , Maximum output , Harmony

Select The Blank

Question Philosophy of scientific management says that science is not a rule of ________.

Correct Answer ThumbYour Answer Thumb

Select The Blank

Question ________ is one of the major barriers to entry.Correct Answer Government policy

Your Answer Government policy

True/False

Question Robert Owen was a railroad builder in America.Correct Answer False

Your Answer False

True/False

Question India should borrow management skill from other countries but one should never borrow the use of the mechanical artsand applied sciences -


Your Answer False

True/FalseQuestion Business families have started spending more on research and development.

Correct Answer True

Your Answer True

Multiple Choice Multiple Answer Question Under the role of management consultant, consultant acts as a

Correct Answer Motivator , Leader , Counselor

Your Answer Motivator , Leader , Counselor

Multiple Choice Single Answer Question A vision statement should have which option among the following components.

Correct Answer Precise and objective

Your Answer Precise and objective

Multiple Choice Single Answer Question Planning is imperative in which type of environment

160



Correct Answer Uncertain

Your Answer Uncertain


Question Objectives can be classified asCorrect Answer On the basis of time , On the basis of functions , On the basis of levels

Your Answer On the basis of goals , On the basis of time , On the basis of functions , On the basis of levels

Multiple Choice Multiple Answer Question The process of forecasting is based onCorrect Answer Future trends , Current analysis , Past performance

Your Answer Future trends , Current analysis , Past performance


Question Principles of effective delegation are:Correct Answer Train the subordinates , Reward delegation , Appropriate reporting system

Your Answer Train the subordinates , Reward delegation , Appropriate reporting system


Question Advantages of delegation of authority would be:Correct Answer Prompt decision making , Opportunity to subordinates to grow and develop , Satisfaction to subordinates in terms

of recognition

Your Answer Prompt decision making , Opportunity to subordinates to grow and develop , Satisfaction to subordinates in terms of

recognition

Select The Blank Question Costliness of the ________ is the overriding factor determining the extent of decentralization.

Correct Answer Decision

Your Answer Controlling


Question Organization is apart of which type of system?

Correct Answer Social

Your Answer Social


Question Elements of direction are

Correct Answer maintaining discipline , motivation of subordinates , rewarding good performance

Your Answer maintaining discipline , motivation of subordinates

True/False

Question Every manager in an organisation gives direction to his subordinates as a superior and receives direction as subordinate

from his superior.


Select The Blank

Question Maintaining discipline and ________ those who perform properly, is an element of direction.

Correct Answer controllingYour Answer rewarding


Question Just like planning, controlling process can achieve the objective and goals, if it is

Correct Answer ContinuousYour Answer Continuous


Question Certain important motivational techniques are

Correct Answer Monetary incentives , Job-based techniques , MBO techniquesYour Answer Security technique , Monetary incentives , Job-based techniques


Question David C Mc Celland identified three motives those are

Correct Answer Affiliation , Power , AchievementYour Answer Affiliation , Power , Achievement

True/False

Question According to Theory Y, people lack self-motivation and require to be externally controlled and closely supervised in order

to get the maximum output for them.Correct Answer False

161



Your Answer False

True/False

Question Safety needs are those where the person feel important and must also receive recognition from others.


Select The Blank

Question Positive motivation makes people willing to do their work in the best way they can and improve their ________.Correct Answer performanceYour Answer productivity

Match The Following


Theory X Both men and boss participate and jointly determine each individual's major areas of responsibility. People do not have

ambitions and they try to shirk responsibility

Theory Y People do not have ambitions and they try to shirk responsibility The average human beings, under proper conditions, do

not shirk responsibility.

MBO technique Autocratic, democratic styles of leadership have their own implications for employee motivation. Both men and boss

participate and jointly determine each individual's major areas of responsibility.

Leadership Technique The average human beings, under proper conditions, do not shirk responsibility. Autocratic, democratic styles

of leadership have their own implications for employee motivation.





Multiple Choice Single Answer Question A group of firms dealing in the same line of business are called as

Correct Answer Industry

Your Answer Industry


Question Firm is an


Your Answer industrial unit

Select The Blank




True/False

Question Under perfect competition there are large number of buyers and few sellers.


Your Answer False







Question When more units of a commodity are purchased in response to decline in price of that commodity, it is called as expansion

of


True/False

Question Inflation is a great opportunity for merchants to earn more profit.


162




Question Q = f ( N, L, K, T ) , this algebraic expression is used for

Correct Answer Production Function

Your Answer Production Function




Match The Following







Question Effective Demand covers

Correct Answer Consumption outlay for the households , Investment outlay in the private sector , Government’s spending for consumption as well as investment

Your Answer Consumption outlay for the households , Investment outlay in the private sector , How a consumer effectively

demand the good in the market

True/False



Your Answer False



Correct Answer The cost of production is unchanged , No change in technique of production , Government policies are unchanged

Your Answer The cost of production is unchanged , No change in technique of production , Government policies are unchanged




purchasing power of money & savings constant or is it being eroded because of inflation?Your Answer what commodities to produce and in what quantities? , by what methods are the commodities produced? , Is






Question In economics, demand means desire backed by adequateCorrect Answer purchasing power


Select The Blank

Question The goods become ________ only when each individual has an access to the entire amount of it and its use by theindividual does not reduce its availability to others.



True/FalseQuestion Micro-economics theory studies how a free enterprise economy determines the price of goods and services.


Your Answer False

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

163






Question Exceptions to the Law of Demand areCorrect Answer Giffen goods , Articles of snob appeal , Speculation


Select The Blank Question The minimum number of directors which public limited should have is ________.Correct Answer 3

Your Answer 3


Question 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 to the railways.

Your Answer a lot of sufferings to the people near the railway. , cost to the society. , affects the railways


Question Phases of business cycleCorrect Answer Expansion , Peak , Recession



Question If a person is habituated to the consumption of a commodity and if he cannot easily give up its use, demand for it is

generallyCorrect Answer inelastic


Multiple Choice Multiple Answer Question Gross Profit includes


profit

Your Answer remuneration for the factors of production paid by the entrepreneur , depreciation and maintenance charges , net profit

True/False


Correct Answer True

Your Answer True

True/False



Your Answer False




liberalization with a view to integrate the indian economy with the world economy , To remove restrictions on direct foreigninvestment as also to free the domestic entrepreneur from the restriction of MRTP act

Your Answer To unshackle the indian industrial economy from the cobwebs of unnecessary bureaucratic control , To introduce




Question The promoters of a company can get incorporated by filing with the registrarof companies various documents such as




Question Which statement is true about Pure Private goods

Correct Answer Principle of Exclusion applies to them

Your Answer Principle of Exclusion applies to them






164





Your Answer Advantages of large-scale production , Low cost of production , It avails benefits of cheaper finance

True/FalseQuestion In case of decrease in supply, the supply curve shifts to left side of the original supply curve.

Correct Answer True

Your Answer True

Select The Blank Question The chemical effluents recklessly released by a chemical factory in the river causing water pollution, is an example of

________ cost.



Select The Blank




True/False


Correct Answer True

Your Answer False

Multiple Choice Multiple Answer Question The features of a Joint Stock-Company are

Correct Answer perpetual succession , limited liability , free transferability of shares

Your Answer perpetual succession , limited liability , free transferability of shares






Question TR - (W+R+I+M), this equation is used for calculating


Your Answer Accounting Profit




Your Answer economic stabilization , employment generation , minimization of production cost

Select The Blank





Question In the law of variable proportion, a stage is reached when marginal product is

Correct Answer zero

Your Answer zero

True/False

Question The externalities that may be an economic gain or economic losses to other economic units are referred to as technological

externalities.


Select The Blank


Correct Answer PartnersYour Answer Partners

Select The Blank



165



Match The Following


Paid – up capital is that part of the subscribed capital which the public directly pay – up to the company, as part payment of the sharewhich the public directly pay – up to the company, as part payment of the share

Authorized capital refers to the maximum amount which can be raised by a company by selling shares. the maximum amount which

can be raised by a company by selling shares.

Issued capital refers to that part public of the authorized capital which is issued for subscription by dividing into shares. which is

issued for subscription by dividing into shares.

Subscribed Capital is that part of the issued capital which is actually subscribed by the public. that part of the issued capital which is

actually subscribed by the public.

Question contraction of demand is defined as a situation when lesser quantity of a commodity is demanded only because

the price of the commodity in questionCorrect Answer risen




Question The management of the cooperative form of business organization is totalitarian in nature.






Question In contrast to the normative concept of justice, efficiency and inefficiency are positive concepts

Correct Answer True



rapidly

Question Other things being equal, the higher ________ of commodity, the smaller is the quantity ________ and lower the price , larger is the quantity demanded.



Question The production function is the name given to the ________ between the rates of ________ of productive

services and rate of output of a product


166




Question Under perfect competition, if demand increases, supply being constant, the price wouldCorrect Answer rise

Question The implicit cost is opportunity cost.Correct Answer True

Question The economic stabilization meansCorrect Answer Preventing excessive economic fluctuations , Efficient utilization of labour and other factors of production ,


Question The demand curve has a negative slope.

Correct Answer True



Correct Answer True



Question When is price discrimination possible

Correct Answer In Monopoly Market , In case of Services sold , In case of geographical barriers



Correct Answer changes

Question Cross elasticity of demand may be defined as the ratio of proportionate change of quantity demanded of

________ to a given proportionate change in ________ of the related commodity â€˜Yâ€™.Correct Answer commodity â€˜Xâ€™


Question All human wants that can be satisfied by consuming goods and services are insatiable.

Correct Answer True



167





Question In economics the questions related to the dynamic or static ( otherwise) capacity of the economy to produce



Question Assumptions of the Law of Demand are:

Correct Answer No change in consumerâ€™s income , No change in consumerâ€™s preferences , No change in fashion

Question Every nationâ€™s resources which are used to produce the quantities of goods and services that would be

required to satisfy all its citizenâ€™s wants are


Question Keynes, on the basis of a fundamental ________ law, observed that as income ________ consumption also

increases but less proportionately

Correct Answer psychological



Correct Answer True

Question Internal Economies:





Question Recession includes

Correct Answer The demand is halted , Increase in production of goods , Inventories piling up in stocks

Question The basic economic problems that are faced by various types of Economics.

Correct Answer What commodities are being produced? , By what methods are these commodities produced. , How is

societyâ€™s output of goods and services divided among its members?

Question Income elasticity of demand can be defined as the ________ of proportionate ________ in the quantity

demanded of the commodity to a given proportionate change in income of the consumer.Correct Answer ratio




168



Question Scope of Managerial Economics deals with:

Correct Answer Demand analysis and forecasting. , Production function & cost analysis. , Inventory management adverting,

price system.

Question 1) Organisation of production requires bringing together various ________ and ________ the efforts of all the

participants in the process of production.

Correct Answer factors of production

Correct Answer coordinating

Question The study of the working and allocation of resources in the free market economies is the topic in theCorrect Answer theory of price

Question Conditions of equilibriumCorrect Answer Marginal Revenue should be equal to Marginal Cost , The Marginal cost curve should cut the marginal revenue


Question In economics the question related to the selection of methods with which commodities are produced is a subjectmatter of


Question Every nation's ________ are insufficient to produce the quantities of ________ than would be required to

satisfy all of its citizens' wants.

Correct Answer resources

Correct Answer goods and services

Question Expansion of supply is traced by the movement an the supply curve







Question In the words of Mr. Kuchhal, a joint-stock company is an ________ association, which is an artificial legal

person, having ________ legal entity, with a perpetual succession, a carrying a l

Correct Answer incorporated

Correct Answer independent

Question Specific organizational goals of Firms are:Correct Answer Maximisation of profit , Reasonable Profit Target , Sales revenue Maximization

Question There is separation of ownership and management in a

Correct Answer Joint stock company.

169













Your Answer management science


Correct Answer Universal

Your Answer Universal







Multiple Choice Single Answer Question The things that are produced by factors of production are called






Your Answer Neutral

True/False

Question A firm under perfect competition is a price maker


Your Answer False

True/False

Question When demand and supply rise and fall in the same proportion, the equilibrium price changes


Your Answer False

True/False

Question Market means a particular area where buyers and sellers meet


Your Answer True


Question Goods which are completely divisible and to them the principle of exclusion applies in full measure are

Correct Answer Pure private goods



Question Market system of economy is characterized by consumer’s

Correct Answer sovereignty

Your Answer freedom

True/False

170



Question In case of a proprietary firm the liability of the proprietor is limited


Your Answer False

Multiple Choice Single Answer Question Macro – economics provides an exploration to the functioning of an economy in

Correct Answer general

Your Answer general

True/FalseQuestion The subject matter of macro – economics includes the theory of income and employment at an individual level


Your Answer True


Inflation Deficit financing Deficit f inancing

R.B.I. General and selective credit control measures Two different prices

P.D.S. Essential commodities General and selective credit control measures

Dual prices Two different prices Essential commodities

The consumers’ Protection Act 1986 Right to information Right to information


Question Depreciation is the value caused by the continuous use of a capital asset isCorrect Answer loss

Your Answer loss

True/False


Your Answer False

True/FalseQuestion According to Prof Knight, profit is the reward for uncertainty bearing.

Correct Answer True

Your Answer True

True/FalseQuestion According to J.B. Clark, profit is the reward paid to the entrepreneur for dynamism.

Correct Answer True

Your Answer True

Multiple Choice Single Answer Question Complementary goods are demanded


Your Answer jointly


The law of demand states When price falls demand rises Change in the price of anothercommodity

The law of demand indicates Relationship between the price of a commodity and the quantity Demanded The more availableare substitutes for that product

Cross demand is the change in the quantity demanded of a given commodity in response to the Change in the price of

anothercommodity Demand was entirely inelastic

Incase there were no changes in the quantity of food sold even when its price had fallen we would know that Demand was entirely

inelastic Relationship between the price of a commodity and the quantity Demanded

The elasticity of demand for product will be higher The more available are substitutes for that product When price falls

demand rises

171




Question As per the law marginal product becomes negative when total product

Correct Answer falls

Your Answer falls


Question The law of diminishing returns is applicable to agriculture provided the state of technology is given and

Correct Answer constantYour Answer constant


Question Under 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 whi


Select The Blank

Question Quantitative credit control measures such as ________ operations, change in the bank rate, and changes in the

________ ratiosCorrect Answer open market

Your Answer open market

Correct Answer statutory reserve

Your Answer statutory reserve

Multiple Choice Single Answer Question AVC is the per unit variable cost of


Your Answer Total Variable Cost

True/False



Correct Answer True

Your Answer True

True/False

Question The laws of returns to scale explain the behavior of output in response to changes in scale.




Correct Answer Is a group of firms , All firms dealing in the same line of business , The ownership and management of eachfirm is different

Your Answer Is a group of firms , All firms dealing in the same line of business


Question DumpingCorrect Answer It is possible in the case of Monopoly Market , Selling same good at higher price in home market and lower at

price in the international market , It is encourage with a view to promote the exports

Your Answer It is possible in the case of Monopoly Market , Selling same good at higher price in home market and lower at

price in the international market

Select The Blank

Question Under perfect competition, ________ is determined by the interaction of total ________ and total supply in the

market


Your Answer priceCorrect Answer demand

Your Answer demand

Select The Blank

Question Oligopoly is a type of ________ market. A ________ exists in the industryCorrect Answer imperfect



Your Answer few firms


172



Question Advantages of Cost-Benefit Analysis

Correct Answer It aims at maximization of social welfare , In following this principle, the problem of infinite target value does

not arise , It shows the measures necessary for attaining maximum net wealth

Your Answer It aims at maximization of social welfare , In following this principle, the problem of infinite target value does

not arise , It shows the measures necessary for attaining maximum net wealth



Correct Answer Determine the level of income and output in an economy , Is total expenditure is equal to total income in aneconomy , Study of aggregate demand and aggregate supply

Your Answer Determine the level of income and output in an economy , Is total expenditure 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 the large it concerns the ________ of economic life”.


Your Answer macro

Correct Answer overall dimensions

Your Answer overall dimensions


Question Different types of business organizations are;

Correct Answer Private sector. , Public sector. , Joint sector.

Your Answer Private sector. , Public sector. , Joint sector.



Correct Answer On the basis of economic system , On the basis of motive , On the basis of principle of pricing

Your Answer On the basis of motive , On the basis of principle of pricing


Question Methods of Demand forecasting for new Products are:

Correct Answer Product life Cycle Analysis , Test Marketing , Evolutionary Approach

Your Answer Evolutionary Approach


Question Index numbers may broadly be classified as:

Correct Answer Price indices , Quantity Indices , Special purpose indicesYour Answer Price indices , Quantity Indices

Select The Blank

Question Economics is a ________ , which studies human behaviour as a relationship between ________ , which have

alternative uses.Correct Answer science

Your Answer science

Correct Answer ends and scarce means

Your 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 product


Your Answer relationshipCorrect Answer input

Your Answer input

Select The Blank

Question Internal economies are those advantages of large- scale ________ , which accrue to a ________ on account of its superior techniques and management



Correct Answer firm

Your Answer industry

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 proportionateYour Answer change

173




Your Answer proportionate

Select The Blank

Question Costs may be classified as : (a) ________ , including material costs, wage cost and interest cost (b) ________ ,including costs of advertising and (c) other costs, including insurance ch

Correct Answer Production costs

Your Answer Production costs

Correct Answer Selling costsYour Answer Selling costs

Select The Blank

Question Costs, which increase because of ________ of a firm, are called incremental costs, and costs, which have to be

borne whether there is expansion or not are, called ________ costs

Correct Answer expansionYour Answer expansion

Correct Answer sunk

Your Answer sunk






Question The externalities which cannot be priced in the market with reference to the demand and supply behavior aretermed as

Correct Answer non - market external effects

Your Answer non - market external effects

True/FalseQuestion In a market system of an economy procedures are guided by profit motive.

Correct Answer True

Your Answer True





Select The Blank


optimal policy aiming at this goal.

Correct Answer net wealth

Your Answer net wealth

Select The Blank



Your Answer public

Select The Blank


economic units.

Correct Answer Third partyYour Answer Third party

Select The Blank


Correct Answer negativeYour Answer risk

True/False



174




Question We say that a nation faces economic problems , under following conditions


specific but have alternative usesYour Answer Man has unlimited wants or ends , The means or resources to satisfy them are limited , These resources are not


Multiple Choice Multiple Answer Question Every nation, poor or rich small or great has to face basic economic problem that isCorrect Answer what commodities to produce and in what quantities? , by what methods are the commodities produced? , Is


Your Answer what commodities to produce and in what quantities? , by what methods are the commodities produced?

True/FalseQuestion A plant is an economic unit which takes various decisions related to production and distribution.


Your Answer False

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

Correct Answer 2

Your Answer 2

Select The Blank

Question The minimum number of directors which public limited should have is ________.Correct Answer 3

Your Answer 3

Multiple Choice Multiple Answer Question Economist's concept of profit is

Correct Answer Pure Profit , Economic Profit , Just Profit

Your Answer Pure Profit , Economic Profit

Multiple Choice Single Answer Question In economics, demand means desire backed by adequate



True/False



Your Answer False

Select The Blank




Select The Blank









Question Demand Curve

Correct Answer Is a graphical presentation , Slopes downward , Explain the relation between price and demand






True/False

175



Question In case of decrease in supply, the supply curve shifts to left side of the original supply curve.

Correct Answer True

Your Answer True

True/FalseQuestion A supply schedule is a graphical presentation of supply patterns.


Your Answer False




Your Answer Total product increases at an increasing rate , Average product is increasing but it is below MP

Select The Blank



Your Answer demand

Select The Blank




Select The Blank Question If the output rises in the greater proportion than that of the increase in factor inputs, it is referred to as

________.




Question A place where buyers & sellers meet each other to effect a business transaction is known as


Your Answer Market



Correct Answer outputYour Answer output




True/False



True/False



Match The Following


Demand curve under oligopoly iskinky kinky

Perfect competition perfectly elastic Average Revenue curve perfectly elastic Average Revenue curve

Marginal cost pricing helps the firm to become more aggressive in the market helps the firm to become more aggressive in the market

Going rate pricing emphasizes the market conditions emphasizes the market conditions

Multiple Choice Multiple Answer Question Features of an Industry are

176




group of firms

Your Answer All firms dealing in the same line of business , The ownership and management of each firm is different , Is a

group of firms


Question Features of Oligopoly Market are




Question Marginal cost pricing explains that the

Correct Answer Price charged should be equal to the marginal cost , Cost price sets the lower limits for firm’s price , Cost price


Your Answer Price charged should be equal to the marginal cost , Cost price sets the lower limits for firm’s price , It based onfull cost pricing


Question The crucial factor in determining the level of income and employment, according to Keynes is

Correct Answer effective demandYour Answer effective demand




Your Answer excess of supply

True/False



Match The Following


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 M.E.C. and ii) the rate of interest.





Correct Answer increasingYour Answer increasing



community are supplied those goods through fair price shops which areCorrect Answer fair



Question The government has adopted a system of dual prices in the case of Correct Answer essential goods

Your Answer capital goods


Question Often monopolies purposely keep certain factors of production idle creating artificial scarcities of their productsas a result the prices

Correct Answer rise

Your Answer rise

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

177



Correct Answer True

Your Answer True


Question Reasons for need of public distribution system areCorrect Answer To maintain stable price conditions , To bring an efficient management of the supply , To supply the necessary


Your Answer To maintain stable price conditions , To bring an efficient management of the supply , To supply the necessary








Correct Answer zero

Your Answer zero


Question The indivisible goods whose benefits cannot be priced are calledCorrect Answer Pure public goods


True/FalseQuestion The financing of the pure public goods has to be through public expenditure and not through market pricing.

Correct Answer True

Your Answer True

Multiple Choice Multiple Answer Question Advantages of Cost-Benefit Analysis

Correct Answer It aims at maximization of social welfare , In this principle, the problem of infinite target value does not arise ,


Your Answer In this principle, the problem of infinite target value does not arise , It shows the measures necessary for attaining maximum net wealth , It considered the effect of diminishing marginal utility of additional wealth

Select The Blank




Select The Blank




Select The Blank Question Defence service is an example of ________ good.



Select The Blank Question In the context of formulating an investment project, ________ feasibility means the availability of supervisors

for implementing and running the project smoothly and professionally.



Select The Blank



Your Answer profit

True/False

178





Your Answer False


Correct Answer True

Your Answer True

Multiple Choice Single Answer Question All firms producing the homogenous or similar products together make



Multiple Choice Single Answer Question The suggestion of maximization of balanced growth rate as another alternative objective of a firm's profit is

suggested by

Correct Answer Prof. Morris

Your Answer Baumol

Match The Following


The Homeostatic theory Prof. Kenneth Boulding Baumol

Satisfying behavior Cyert R.M. and J.G. March Cyert R.M. and J.G. March

Joint – sector enterprises Hindustan Machine Tools Hindustan Machine Tools

State enterprises Public welfare Public welfare



Correct Answer an independently administered business unit , centre where the decisions about what to produce how to produceare taken , a business unit, which hires resources for production







Select The Blank




Select The Blank




True/False



Your Answer False


Question Gross Profit includes


profit

Your Answer remuneration for the factors of production paid by the entrepreneur , depreciation and maintenance charges , net profit


Question When with a rise in price, the total outlay falls, or with a fall in price, the total outlay rises, elasticity of demand

isCorrect Answer > 1

179



Your Answer > 1

Match The Following



Tea and sugar Complimentary goodsComplimentary goods

Excess demand can be defined asquantity demanded minus quantity supplied quantity demanded minus quantity supplied





Your Answer unity
















True/False

Question In the traditional concept of equilibrium, a firm attains the equilibrium when the firm’s Total Revenue (T.R.)

=Total Cost (T.C.).


True/False


production, there will be increase in supply.Correct Answer True

Your Answer True





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 scale


Select The Blank



Select The Blank


180




Select The Blank




Question Under monopoly entry of new firms isCorrect Answer prohibitedYour Answer prohibited






demandCorrect Answer is not all affected


True/False



True/False

Question When a firm’s average revenue (A.R) is less than its average cost, it earns only normal profit.Correct Answer False

Your Answer False


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


Multiple Choice Multiple Answer Question Conditions of Price Discrimination are:






Question The principle of full employment equilibrium was stated by

Correct Answer Say's Law of Market

Your Answer Say's Law of Market




Correct Answer less than full employmentYour Answer less than full employment

True/False


consumption.Correct Answer True

Your Answer True

True/False

Question During the period of recession there is increase in incomes of wage and interest earners.Correct Answer False

Your Answer False



181









Match The Following







Multiple Choice Single Answer Question The feasibility, which includes the prospects of employment generation, development of backward areas, social

groups comprises of

Correct Answer Economic feasibility

Your Answer Economic feasibility


Question As far as its use is concerned, tuning in of a radio can be categorized as:

Correct Answer Divisible

Your Answer Divisible

True/False

Question In a market system of economy, there is no harmony between individual interests and interests of the

community.Correct Answer False

Your Answer False

True/False

Question Institution of private property is not an essential feature of Capitalism.Correct Answer False

Your Answer False


Question In case of defense services, all the sections of the society are equally protected and benefited. The defenseservices in other words is

Correct Answer indivisible in character , cannot be priced in the market , a public good


Select The Blank Question On the ________ level, the summation of maximum individual welfare does not automatically lead to



Your Answer micro

Select The Blank




Your Answer exceptions

Select The Blank



Correct Answer indivisibleYour Answer public

182



Select The Blank



Correct Answer technicalYour Answer technical

Select The Blank

Question In a market economy ________ is the best judge of personal interest.Correct Answer individualYour Answer individual

True/False



True/False

Question In a free-enterprise economy, the problems of what how and for whom are solved by a planning committee





Your Answer plant



Correct Answer Simple Shares , Cumulative Shares , Redeemable SharesYour Answer Simple Shares , Redeemable Shares


Question The sole proprietorship type of organization is found in

Correct Answer Agriculture, , Retail trade, , Hotel,Your Answer Agriculture, , Retail trade, , Hotel,


Question Co-operative organizations isCorrect Answer voluntary organization , managed by democratic principle , organization, which performs its business within the

members




Your Answer Directors

Multiple Choice Single Answer Question The method of inventory valuation in which , the cost of production is calculated on the assumption that the

material which was last to enter the inventory of the company was used first is

Correct Answer LIFO

Your Answer LIFO

True/False

Question Profit should be large enough for a plough – back for business expansion.

Correct Answer True

Your Answer True

True/False



Your Answer True




Your Answer income accruing to the equity holders , rent accrue to the owner


183



Question Change in income of a person may result in demand for goods to


Your Answer change

Multiple Choice Single Answer Question With decline in price of a commodity, total expenditure spent on the commodity is less than before, then

elasticity of demand for the commodity is

Correct Answer < 1

Your Answer >1 Multiple Choice Single Answer



Your Answer substitutes goods

True/False

Question Demand for luxury goods is inelastic


Your Answer False

Match The Following


Increase in demand Upward shift of the demand curve Upward movement on the demand curve

Extension of demand Downward movement on the demand curve Vertical Demand curve

Decrease in Demand Leftward shift of the demand curve Downward movement on the demand curve

Contraction of Demand Upward movement on the demand curve Leftward shift of the demand curve

Select The Blank


Correct Answer decreaseYour Answer decrease


Question Reasons for change in Demand (Increase or Decrease in Demand)Correct Answer Change income of consumer , Change in population , Change in fashion and customs



Question AVC is the per unit variable cost of Correct Answer production

Your Answer fixed variable

True/False


Your Answer True




Select The Blank



Select The Blank


Your Answer Incremental cost

Select The Blank

Question The out of pocket costs are ________.Correct Answer Explicit costs

184




Select The Blank


Correct Answer Explicit costsYour Answer Fixed costs


Question The supply curve during market period isCorrect Answer perfectly inelasticYour Answer perfectly inelastic



Correct Answer prohibitedYour Answer limited

True/False


system of subsidized pricing is followed.Correct Answer True

Your Answer True

True/False




Question Macro Economics is the study of Correct Answer The aggregate behavior of the economy , The behavior of economic agents , Problems such as the rates of

inflation, the balance of payments, etc

Your Answer The aggregate behavior of the economy , Problems such as the rates of inflation, the balance of payments, etc ,

Economic welfare




Your Answer an individual consumer , particular market for a given commodity , major economic issues , problems & policies



Correct Answer More employment opportunities , Increase in profitability , Wage rate increaseYour Answer More employment opportunities , Increase in profitability , Wage rate increase



Correct Answer open market operations , changes in bank rates , changes in statutory reserve ratioYour Answer open market operations , moral suasion


Question The government has adopted a system of dual prices in the case of

Correct Answer essential goodsYour Answer essential goods



Correct Answer Phased privatization , Reducing deficit , Capital support to plansYour Answer Phased privatization , Reducing deficit , Capital support to plans






Match The Following

185










Question The feasibility, which includes the prospects of employment generation, development of backward areas, socialgroups comprises of



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



True/False

Question In a market system of economy, there is no harmony between individual interests and interests of thecommunity.


Your Answer False

True/False



Your Answer False




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

Select The Blank


maximum social welfare.Correct Answer macro

Your Answer micro

Select The Blank

Question While discussing the product divisibility of public and private goods, the principle of ________ may be appliedin case of only those people who do not agree to pay or who cannot pay the market price






Your Answer public

Select The Blank





Select The Blank




186



True/False


Correct Answer True

Your Answer True

True/False






Your Answer plant




Your Answer Simple Shares , Redeemable Shares



Correct Answer Agriculture, , Retail trade, , Hotel,


Multiple Choice Multiple Answer Question Co-operative organizations is


members


Select The Blank





Question The method of inventory valuation in which , the cost of production is calculated on the assumption that the

material which was last to enter the inventory of the company was used first isCorrect Answer LIFO

Your Answer LIFO

True/False

Question Profit should be large enough for a plough – back for business expansion.Correct Answer True

Your Answer True

True/False


Your Answer True


Question Profit is regarded asCorrect Answer income accruing to the equity holders , wages accrue to the labour , rent accrue to the owner



Question Change in income of a person may result in demand for goods toCorrect Answer change

Your Answer change


Question With decline in price of a commodity, total expenditure spent on the commodity is less than before, thenelasticity of demand for the commodity is

Correct Answer < 1

Your Answer >1


187





True/False

Question Demand for luxury goods is inelasticCorrect Answer False

Your Answer False






Select The Blank




Multiple Choice Multiple Answer Question Reasons for change in Demand (Increase or Decrease in Demand)







True/False

Question The sum of total fixed costs and total variable costs is the total cost.

Correct Answer True

Your Answer True





Select The Blank




Select The Blank




Select The Blank




Select The Blank



Your Answer Fixed costs




Your Answer perfectly inelastic

188





Correct Answer prohibited

Your Answer limited

True/False


system of subsidized pricing is followed.


True/False


Correct Answer True

Your Answer True


Question Macro Economics is the study of

Correct Answer The aggregate behavior of the economy , The behavior of economic agents , Problems such as the rates of

inflation, the balance of payments, etcYour Answer The aggregate behavior of the economy , Problems such as the rates of inflation, the balance of payments, etc ,

Economic welfare



Correct Answer an individual consumer , particular market for a given commodity , operation of a firmYour Answer an individual consumer , particular market for a given commodity , major economic issues , problems &

policies

Multiple Choice Multiple Answer Question 16. The phase of recovery denotes





Your Answer open market operations , moral suasion




Your Answer essential goods







Question The Risk theory of profit was developed byCorrect Answer Hawley

Your Answer Hawley


Question Demand CurveCorrect Answer Is a graphical presentation , Slopes downward , Explain the relation between price and demand


Select The Blank


Your Answer stock



189







True/False






Your Answer output

Select The Blank




Select The Blank


________




Question The city of Surat has specialized in

Correct Answer diamond polishing

Your Answer diamond polishing





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 social

Your Answer social


Question Slope of supply curve isCorrect Answer positive


True/False

Question Inflation is characterized by excess of demand.Correct Answer True

Your Answer False

True/False

Question Giffen goods are superior goods.Correct Answer False

Your Answer False









190








Multiple Choice Multiple Answer Question 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 effect

Your Answer It is a wave like movement , These fluctuations are recurrent in nature , Expansion and contraction in trade






True/False

Question Consumer’s protection involves protection to the consumers from unfair trade practices.

Correct Answer True

Your Answer True

Multiple Choice Single Answer Question Car & petrol, tea & sugar, shoes & socks, sarees & blouse are examples of



True/False

Question The products sold by different sellers under pure competition are heterogeneous.


Your Answer True



Correct Answer rate of interest

Your Answer rate of interest

Match The Following






Select The Blank

Question The financing of ________ goods is done through public expenditure.Correct Answer public

Your Answer public





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


Match The Following


191








True/False



Your Answer False


Question The indivisible goods, whose benefits cannot be priced, and therefore, to which the principle of exclusion does

not apply, are called



Question Diseconomies of small scale production includes


techniques of production , Wastage of raw material & power Your Answer High average cost of production in initial stages , Workers in the factory take some time to adjust with new


True/FalseQuestion In case of a proprietary firm the liability of the proprietor is limited.


Your Answer False



Your Answer service


Question Economist's concept of profit is

Correct Answer Pure Profit , Economic Profit , Just Profit

Your Answer Pure Profit , Economic Profit , Just Profit

Select The Blank





True/False


Correct Answer True

Your Answer True





Select The Blank





Question The assumption of perfect competition in all the analytical theories is made by

Correct Answer Classical economists

Your Answer Classical economists

192



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)



Question Contraction of demand is defined as a situation, when lesser quantity of a commodity is demanded only because

the price of the commodity in question hasCorrect Answer risenYour Answer risen




Select The Blank



True/False


Correct Answer True

Your Answer True

True/False

Question Pure public goods must be in the hands of public sector only.


Select The Blank


Correct Answer All costsYour Answer All costs


True/False



Your Answer False





Select The Blank



Your Answer expand

Select The Blank




True/False

Question Resources are said to be involuntarily un employed when their wastage occur.

Correct Answer True

Your Answer True





193




Question In cost benefit analysis, in the valuation of costs and benefits, for finding the present value, one has to make use

of


Your Answer net present value


Question Partnership in case of general business consists of minimum two persons and maximum

Correct Answer 20 personsYour Answer 20 persons












rapidly

Your Answer Decrease in economic activities , The growth rate becomes negative , The level of national income declinesrapidly

True/False

Question One of the most disturbing characteristics of free – market economies is that waste of resources some timesoccurs

Correct Answer True

Your Answer True

Select The Blank Question The financing of ________ goods is done through public expenditure.


Your Answer private

Select The Blank



Your Answer cost





Select The Blank




Your Answer preference

Match The Following


Statutory reserve ratioQuantitative credit control measure Expansion of credit

Prosperity Expansion of credit Quantitative credit control measure



True/False

Question A Joint Stock Company is managed by the Board of Directors elected by shareholders.Correct Answer True

194



Your Answer True


Question 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 , Non-interference by the state. , Private Profit Motive


Question The externalities which cannot be priced in the market with reference to the demand and supply behavior aretermed as

Correct Answer non - market external effects

Your Answer non - market external effects



Your Answer scarce


Question Slope of supply curve isCorrect Answer positive






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

Correct Answer 2

Your Answer 2

Select The Blank Question The externality which causes an economic gain or an economic loss to other economic units is also referred to








Select The Blank

Question The chemical effluents recklessly released by a chemical factory in the river causing water pollution, is an


Correct Answer socialYour Answer environmental

True/False




Question Features of Long –run market are

Correct Answer It is durable goods market , Supply can be increased or reduced according to the demand , Sellers at leastrecover minimum price for their goods



True/FalseQuestion In macro – economic analysis the behavior of economic agents such as firms, households and government is

seen in total, disregarding details at particular level.

Correct Answer True

Your Answer True


195






Multiple Choice Multiple Answer Question The causes of inflation are



Multiple Choice Single Answer Question True inflation starts only after reaching the level of full



True/FalseQuestion During periods of inflation, the income of farmers as a class decreases.

Correct Answer True

Your Answer False

Multiple Choice Single Answer Question The externality in which the consumption or production levels of an economic unit affect the other economic

units in the economy is called

Correct Answer technological externality

Your Answer technological externality





True/False





Question 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




Match The Following







Multiple Choice Multiple Answer Question Features of monopolistic Competition are

Correct Answer Fairly large number of firms , Product differentiation , Selling costs are existed

Your Answer Fairly large number of firms , Product differentiation , Selling costs are existed

Multiple Choice Multiple Answer Question Assumptions underlying the law of Supply are


unchanged


unchanged

196







True/False

Question Price is the, only determinant of demand




Correct Answer larger

Your Answer larger










Market economy Freely fluctuating price mechanism Freely fluctuating price mechanism

Negative externalities Social costs Social costs

Pure public goods Indivisible goods Indivisible goods

Free riders Principle of exclusion and benefit of good to all without sharing cost Principle of exclusion and benefit of good toall without sharing cost

Select The Blank



True/False

Question A Joint Stock Company has perpetual succession.Correct Answer True

Your Answer True















197





Your Answer distribution

Multiple Choice Single Answer Question Demand forecasting is predicting for the demand of a firm’s product in


Your Answer future

Select The Blank Question A fall in price tends the demand for goods to ________



Multiple Choice Multiple Answer Question The main criterion of indivisibility of a good is that the good

Correct Answer should be equally available to all the members of society. , financing of the good is through public


Your Answer should be equally available to all the members of society. , financing of the good is through public






Select The Blank



Your Answer public


Question Features of Market are

Correct 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 services is undertakenYour Answer Place where buyers and sellers meet each other , A building where a number of shops dealing in a particular

commodity exist

True/FalseQuestion In the measurement of profit, the differences in the concept of profit arise due to differences in cost concepts.

Correct Answer True

Your Answer True

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

Correct Answer True

Your Answer True

Multiple Choice Single Answer Question In general, the demand for necessaries is relatively



True/FalseQuestion One of the most disturbing characteristics of free – market economies is that waste of resources some times

occurs

Correct Answer True

Your Answer True





True/False


Correct Answer True

Your Answer True


198






True/FalseQuestion When demand and supply rise and fall in the same proportion, the equilibrium price changes.


Your Answer True

Multiple Choice Single Answer Question The indivisible goods whose benefits cannot be priced are called



True/FalseQuestion Contraction of supply is traced by the downward movement on the supply curve

Correct Answer True

Your Answer False

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


Your Answer False

True/False

Question There is considerable slush money with politicians & Government servants.Correct Answer True

Your Answer True




Multiple Choice Multiple Answer Question Major types of costs are







Your Answer optimum







Correct Answer It aims at maximization of social welfare , In this principle, the problem of infinite target value does not arise ,

It shows the measures necessary for attaining maximum net wealthYour Answer It aims at maximization of social welfare , In this principle, the problem of infinite target value does not arise ,



Question The income which a businessman might expect from the second best alternative use of his resources is called asCorrect Answer opportunity cost

Your Answer opportunity cost

Select The Blank

Question The social costs and benefits are the external economies and diseconomies resulting from the ________ activities, which are known as, "externalities"



Multiple Choice Multiple Answer Question The characteristics of Inflation are

199




Your Answer Excess of demand , Sustained rise in prices , Cannot be anticipated

Select The Blank

Question A normal demand curve has ________+B299Correct Answer negative slope


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.




A income demand curve for an inferior commodity slopes upwards to right upward to left

A fall in the price of a commodity a rise in consumers real income. fall in the consumer's real income

An exceptional demand curve is one that slopes upwards to right. upwards to right

In case of Giffen goods like bajra a fall in price tends to reduce the demand a rise in consumers real income.

True/False

Question Cyclical fluctuations are recurrent in nature

Correct Answer True

Your Answer True





True/False


economic units, are termed as 'neighborhood effects.'Correct Answer True

Your Answer True



Your Answer centrally directed


Question Features of an Industry areCorrect Answer All firms dealing in the same line of business , The ownership and management of each firm is different , Is a

group of firms


group of firms


Question Supply curve shifts to the right side of the original supply curve when, the supply



Select The Blank



Your Answer demand

Select The Blank




ECO assgn :Shruti

200




Question The indivisible goods, whose benefits cannot be priced, and therefore, to which the principle of exclusion does

not apply, are called






Match The Following


Market economy Freely fluctuating price mechanism Freely fluctuating price mechanism

Negative externalities Social costs Social costs

Pure public goods Indivisible goods Indivisible goods

Free riders Principle of exclusion and benefit of good to all without sharing cost Principle of exclusion and benefit of good to

all without sharing cost

Select The Blank



True/FalseQuestion A Joint Stock Company has perpetual succession.

Correct Answer True

Your Answer True

Multiple Choice Multiple Answer Question We say that a nation faces economic problems , under following conditions



Your Answer Man has unlimited wants or ends , The means or resources to satisfy them are limited , These resources are notspecific but have alternative uses



Correct Answer expenditureYour Answer expenditure






Correct Answer consumptionYour Answer distribution




Select The Blank


Correct Answer expandYour Answer increase


Question The main criterion of indivisibility of a good is that the good

Correct Answer should be equally available to all the members of society. , financing of the good is through publicexpenditure. , the principle of exclusion does not apply.

201



Your Answer should be equally available to all the members of society. , financing of the good is through public



Question Reasons for change in Demand (Increase or Decrease in Demand)Correct Answer Change income of consumer , Change in population , Change in fashion and customs


Select The Blank Question Defence service is an example of ________ good.Correct Answer indivisible

Your Answer public


Question 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 services is undertaken

Your Answer Place where buyers and sellers meet each other , A building where a number of shops dealing in a particular

commodity exist

True/False


Correct Answer True

Your Answer True

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

Correct Answer True

Your Answer True





True/False

Question One of the most disturbing characteristics of free – market economies is that waste of resources some times

occurs




Correct Answer economic stabilization , employment generation , poverty reductionYour Answer economic stabilization , employment generation , poverty reduction

True/False






True/False






True/False



202



A fall in the price of a commodity a rise in consumers real income. fall in the consumer's real income

An exceptional demand curve is one that slopes upwards to right. upwards to right

In case of Giffen goods like bajra a fall in price tends to reduce the demand a rise in consumers real income.

True/FalseQuestion Cyclical fluctuations are recurrent in natureCorrect Answer True

Your Answer True


Question The government has adopted a system of dual prices in the case of Correct Answer essential goods


True/False


Correct Answer True

Your Answer True



Your Answer centrally directed

Multiple Choice Multiple Answer Question Features of an Industry are


group of firms


group of firms


Question Supply curve shifts to the right side of the original supply curve when, the supply

Correct Answer increasesYour Answer increases

Select The Blank



Select The Blank


Correct Answer Wholesale prices indexYour Answer Wholesale prices index


Select The Blank







expansion of


Select The Blank



204





community are supplied those goods through fair price shops which are


Select The Blank

Question In a market system of an economy, producers are guided by ________ motive.Correct Answer profitYour Answer profit



Correct Answer open market operations , changes in bank rates , changes in statutory reserve ratioYour Answer open market operations , changes in bank rates , changes in statutory reserve ratio

Select The Blank









Correct Answer Principle of Exclusion applies to themYour Answer Principle of Exclusion applies to them

Match The Following


Under perfect competition, it is assumed that the cost of transportation does not exist cost of transportation does not

exist

Excess capacity monopolist ic competition monopolistic competition

Public enterprises may incur some social costs which private enterprise may not bear at all. which private enterprise may not

bear at all.

The buyers and sellers may be away from each other and yet they may constitute a market over telephone or through internetyet they may constitute a market over telephone or through internet







Question Price of a product under perfect competition is determined by the interaction of total supply and

Correct Answer total demand

Your Answer total demand



Correct Answer backward

Your Answer upward

True/False



Your Answer True


205






Multiple Choice Single Answer Question The act of manufacturing goods and services is called









True/FalseQuestion Inflation is a great opportunity for merchants to earn more profit.

Correct Answer True

Your Answer True

True/False

Question In case of a proprietary firm the liability of the proprietor is limited.Correct Answer False

Your Answer False

Multiple Choice Multiple Answer Question According to Keynes there are three motives for holding cash for liquidity preference

Correct Answer the transactions motive , the precautionary motive , the speculative motive

Your Answer the precautionary motive , the speculative motive , the profit motive

True/FalseQuestion There never was in any country at any time 'pure capitalism' or 'pure communism.'

Correct Answer True

Your Answer True

Select The Blank

Question According to the World Bank's approach, the trade able items would be valued at the corresponding world

prices and the non-trade able items at the ________.


Your Answer shadow prices








All firms are working with same efficiencyYour Answer Competing firms are selling more or less the same product , All firms are working with same efficiency , All

firms share transportation cost

Select The Blank


Your Answer public

True/False

Question The congress government led by Narsimha Rao announced the New Industrial Policy in July 1991.Correct Answer True

Your Answer True

True/False

Question A monopolist’s product is a unique product.Correct Answer True

206



Your Answer True


Question Steps in cost benefit analysis

Correct Answer Identification of a project , Formulation of the project , Appraisal and selection of the projectYour Answer Identification of a project , Appraisal and selection of the project , Social cost and benefits


Question Factors influencing selling costs areCorrect Answer Type of product , Introduction of new goods , Technology changesYour Answer Type of product , Introduction of new goods , Technology changes





Question With decline in price of a commodity, total expenditure spent on the commodity is less than before, then

elasticity of demand for the commodity isCorrect Answer < 1

Your Answer >1

Select The Blank


example of ________ cost.Correct Answer social

Your Answer social



Prosperity Expansion of credit Expansion of credit





Correct Answer rate of interestYour Answer rate of interest

True/False



True/False



True/False


consumption.Correct Answer False

Your Answer False

Select The Blank



Select The Blank


207






Correct Answer The two markets in which the product is sold should be kept separate , The elasticity of demand in differentmarkets should be different , Market must be imperfect



Multiple Choice Multiple Answer Question The features of business or trade cycle are

Correct Answer It is a wave like movement , These fluctuations are recurrent in nature , Expansion and contraction in trade




True/False

Question The rise in prices is basically because of shortages of basic goods & services and a rapid growth of money

supply.





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


Multiple Choice Multiple Answer Question The railways use a lot of coal in firing the steam locomotives. This act causes

Correct Answer a lot of sufferings to the people near the railway. , cost to the society. , no cost to the railways.

Your Answer a lot of sufferings to the people near the railway. , cost to the society. , no cost to the railways.





Question The study of , what commodities are being produced and in what quantites I.e the study of allocation of

resources is discussed under the

Correct Answer Theory of price

Your Answer Theory of production


Select The Blank







expansion of


Select The Blank





community are supplied those goods through fair price shops which areCorrect Answer fair

208



Your Answer fair

Select The Blank




Question Quantitative credit control measures areCorrect Answer open market operations , changes in bank rates , changes in statutory reserve ratioYour Answer open market operations , changes in bank rates , changes in statutory reserve ratio

Select The Blank





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



Correct Answer Principle of Exclusion applies to them

Your Answer Principle of Exclusion applies to them

Match The Following



exist



bear at all.

The buyers and sellers may be away from each other and yet they may constitute a market over telephone or through internetyet they may constitute a market over telephone or through internet












Correct Answer backward

Your Answer upward

True/False



Your Answer True






209












True/FalseQuestion Inflation is a great opportunity for merchants to earn more profit.

Correct Answer True

Your Answer True

True/FalseQuestion In case of a proprietary firm the liability of the proprietor is limited.


Your Answer False


Question According to Keynes there are three motives for holding cash for liquidity preferenceCorrect Answer the transactions motive , the precautionary motive , the speculative motive

Your Answer the precautionary motive , the speculative motive , the profit motive

True/FalseQuestion There never was in any country at any time 'pure capitalism' or 'pure communism.'

Correct Answer True

Your Answer True

Select The Blank Question According to the World Bank's approach, the trade able items would be valued at the corresponding world

prices and the non-trade able items at the ________.










All firms are working with same efficiencyYour Answer Competing firms are selling more or less the same product , All firms are working with same efficiency , All

firms share transportation cost

Select The Blank


Your Answer public

True/False


Your Answer True

True/False

Question A monopolist’s product is a unique product.Correct Answer True

Your Answer True


Question Steps in cost benefit analysisCorrect Answer Identification of a project , Formulation of the project , Appraisal and selection of the project

210



Your Answer Identification of a project , Appraisal and selection of the project , Social cost and benefits



Correct Answer Type of product , Introduction of new goods , Technology changesYour Answer Type of product , Introduction of new goods , Technology changes


Question The principle of exclusion cannot be applied to the goods, which areCorrect Answer indivisibleYour Answer indivisible




Your Answer >1

Select The Blank

Question The chemical effluents recklessly released by a chemical factory in the river causing water pollution, is anexample of ________ cost.


Your Answer social

Match The Following








Correct Answer rate of interestYour Answer rate of interest

True/False



True/False



True/False


consumption.Correct Answer False

Your Answer False

Select The Blank



Select The Blank





211








Question The features of business or trade cycle are


cycle are cumulative in effectYour Answer It is a wave like movement , These fluctuations are recurrent in nature , Expansion and contraction in trade


True/False

Question The rise in prices is basically because of shortages of basic goods & services and a rapid growth of money

supply.Correct Answer True

Your Answer True


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







Select The Blank





Question The study of , what commodities are being produced and in what quantites I.e the study of allocation of

resources is discussed under the

Correct Answer Theory of priceYour Answer Theory of production

Managerial Economics Dt: 26-12-2005

List Of Attempted Questions And Answers

Select The Blank




True/False

Question Under perfect competition, price is determined by the interaction of total demand and total supply in the market.


Your Answer True





Select The Blank






Correct Answer Effective demand , Aggregate supply , Aggregate demand

Your Answer Effective demand , Aggregate supply , Aggregate demand

212









Correct Answer Micro Economics





companyYour Answer It is a business unit organized under one ownership , It is a sole proprietorship , It is a partnership or joint stock

company


Question Whether the economy's capacity to produce goods and services is growing from year to year or remaining static is studiedunder the

Correct Answer Theory of economic growth

Your Answer Theory of economic growth


Question Co-operative organizations isCorrect Answer voluntary organization , managed by democratic principle , organization, which performs its business within the

members




Correct Answer The cost of production is unchanged , No change in technique of production , Government policies are unchanged

Your Answer The cost of production is unchanged , No change in technique of production , Government policies are unchanged

True/False


Correct Answer True

Your Answer True




Your Answer upward


Question Liability of a sole trader is



Select The Blank



Select The Blank


Correct Answer exceptional demand curveYour Answer exceptional demand curve


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 areCorrect Answer insufficient




213






Correct Answer Welfare EconomicsYour Answer Welfare Economics


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



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



True/False

Question The Keynesian theory emphasizes effective supply as a crucial factor in determining the level of income and employment.


Your Answer False




Select The Blank





Your Answer perfect

Match The Following





Inflation 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 increase


Select The Blank


Your Answer demand

Select The Blank




Question The suggestion of maximization of balanced growth rate as another alternative objective of a firm's profit is suggested byCorrect Answer Prof. Morris

214



Your Answer Baumol

True/False




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

Your Answer less


Question The Risk theory of profit was developed byCorrect Answer Hawley

Your Answer Hawley

True/False


Your Answer True

Select The Blank



True/False


Your Answer True






Your Answer Evolutionary approach

Multiple Choice Single Answer Question Often monopolies purposely keep certain factors of production idle creating artificial scarcities of their products as a result

the prices

Correct Answer rise

Your Answer rise





Match The Following



General Theory of Employment, Interest and Money J. M. Keynes J. M. KeynesManagerial economics Decision making and forward planning Decision making and forward planning



Select The Blank



Correct Answer managementYour Answer management

215



True/False


Correct Answer True

Your Answer True


Question Features of Market are

Correct 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 services is 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 services is undertaken




True/False

Question Private profit motive is an essential feature of Capitalism.Correct Answer True

Your Answer True









Your Answer sufficient



Correct Answer perfectYour Answer perfect

True/False

Question Inflation reduces the purchasing power of money and savings.



Question The supply curve during market period is perfectly

Correct Answer inelasticYour Answer inelastic

True/False

Question Micro-economics is primarily concerned with the problem of what, how and for whom to produce


Match The Following







216





True/False

Question The opportunity cost of a product is the opportunity gained of being able to produce some other product.Correct Answer False

Your Answer False

True/FalseQuestion The supply curve in case of unitary elastic supply is rectangular hyperbola.Correct Answer False

Your Answer False


Question An IndustryCorrect Answer Is a group of firms , All firms dealing in the same line of business , The ownership and management of each

firm is different


firm is different

Select The Blank

Question Under monopoly, there is ________ seller who controls the entire ________ in the market

Correct Answer only one



Your Answer supply

Select The Blank

Question Under monopsony, there are ________ sellers but ________ buyer

Correct Answer manyYour Answer many

Correct Answer only one



Marginal utility Addition to total utility Addition to total utility

Total utility increases marginal Posative and declining Marginal utility is zero

At the saturation point for a commodity x the Mux is Zero Demand curve of a commodity

Marginal utilities are Demand curve of a commodity Posative and declining

Total utility is Marginal utility is zero Zero

Select The Blank Question By using cost-benefit analysis we can show the ________ necessary for attaining maximum ________ and

optimal policy aiming at this goal

Correct Answer measures

Your Answer Gross Domestic Product

Correct Answer net wealthYour Answer gross wealth


Question Average propensity to consume

Correct Answer It is defined as the ratio of consumption expenditure to any particular level of income , It is found by dividingconsumption expenditure by income , It is expressed as the percentage of income consumed

Your Answer It is derived by dividing income by consumption expenditure


Question Inflation meansCorrect Answer It is a phenomenon of rising prices , It is a general and dynamic phenomenon , It includes an excess of demand

Your Answer It is a phenomenon of rising prices

Select The Blank

Question Aggregate 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 result

218



Correct Answer schedule

Your Answer demand

Correct Answer revenues

Your Answer revenues

Select The Blank

Question In the ________ terminology, the ________ demand function refers to the schedule of maximum sales

proceeds, which the entrepreneurial community actually does expect to be received from the sale of

Correct Answer KeynesianYour Answer KeynesianCorrect Answer aggregate

Your Answer aggregate


Question The fiscal policy includesCorrect Answer Formation of taxation policy , It is an instrument for economic stabilization , Monitoring of public expenditure



Question The meaning of monetary policyCorrect Answer It is programme of the central bank , It controls the total supply of money , The basic objective is to achieve

economic stability

Your Answer It is programme of the central bank , It controls the total supply of money , The basic objective is to achieve

economic stability



Your Answer Mounting government expenditure , Deficit financing and increase in money supply , Role of black money



Correct 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.

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


Question The sources of economic problems are:

Correct Answer Man has unlimited wants or ends , The means or resources to satisfy them are limited. , These resources are notspecific but have alternative uses.

Your Answer Man has unlimited wants or ends , The means or resources to satisfy them are limited. , These resources are not

specific but have alternative uses.

Multiple Choice Multiple Answer Question Different types of business organizations are;

Correct Answer Private sector. , Public sector. , Joint sector.

Your Answer Joint sector.

Multiple Choice Multiple Answer Question Proprietary firm is

Correct Answer Owned by a single person. , Easy to form. , An organization of single person.

Your Answer Owned by a single person.

Multiple Choice Multiple Answer Question Methods of measurement of elasticity

Correct Answer Percentage Method , Point elasticity Method , Total outlay expenditure method

Your Answer Percentage Method , Point elasticity Method , Total outlay expenditure method

Multiple Choice Multiple Answer Question Demand forecasts are necessary for:


Your Answer Preparation of a budget , Expansion of firms

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

generalization based on abstraction and actual practices. Besides economic theory, mat


Your Answer optimal

Correct Answer statisticsYour Answer

219



Select The Blank

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


Correct Answer land and mineralsYour Answer land and minerals



Select The Blank Question Individual or sole ________ , which is also called sole- ________ , or single entrepreneurship is the most

common, the simplest and the oldest form of business organisation.

Correct Answer proprietorship

Your Answer proprietorship

Correct Answer trader shipYour Answer trader ship

Select The Blank

Question Nominal cost is the ________ cost of production, it is also called expenses of production. The real cost is the

________ cost of production.Correct Answer money

Your Answer opportunity

Correct Answer opportunity

Your Answer gross

Select The Blank Question Costs may be classified as : (a) ________ , including material costs, wage cost and interest cost (b) ________ ,


Correct Answer Production costs

Your Answer Production costsCorrect Answer Selling costs


Select The Blank

Question The costs of self owned resources, which are employed by the ________ , are non- expenditure or , ________ Correct Answer firm

Your Answer firm

Correct Answer implicit costs .

Your Answer implicit costs .


Question The study of the working and allocation of resources in the free market economies is the topic in theCorrect Answer theory of price





True/False

Question The federal government of U.S.A. does not face the basic economic problem.Correct Answer False

Your Answer False


Question In equilibrium analysis of a firm, it is assumed that every individual proprietor exhibits rational economicCorrect Answer behavior

Your Answer behavior

Match The Following


Managerial Economics Prescriptive in nature The theory of distribution


Division of society’s output of goods and services The theory of distribution Prescriptive in nature

220



Motor carsTangible goods Tangible goods


True/False

Question Market price fluctuates very often



Question The firm is the unit that makes the decisions regarding employment of and the output of commodities are

Correct Answer factors of production

Your Answer factors of production


Question The principle of exclusion cannot be applied to the goods which are


Your Answer invisible


Question In the cost – benefit analysis, the firm step involved is that the investor has to choose a few project alternatives

promising a rate of return which is

Correct Answer high

Your Answer high


Question Market system of economy is characterized by consumer’s

Correct Answer sovereigntyYour Answer demand


Question In case of a joint stock company, the liability of share holders is


True/False

Question The divisible goods, whose benefits can be priced, are called pure public goodsCorrect Answer False

Your Answer True

True/False

Question In case of a proprietary firm the liability of the proprietor is limitedCorrect Answer False

Your Answer False

True/False

Question During the phase of depression, the level of national income and expenditure rises rapidlyCorrect Answer False

Your Answer False


Question According J.B.Clark, profit is the reward paid for Correct Answer dynamism



Question Gross profit is the excess of total revenue of a firm over totalCorrect Answer expenditure



Question In general, the demand for necessaries is relativelyCorrect Answer inelastic

Your Answer elastic

True/False

Question Demand for food grains is inelastic but the demand for wheat is elastic.Correct Answer True

221



Your Answer False

Match The Following


Excess supply can be defined as Quantity supplied minus quantity demanded Quantity supplied minus quantity demanded

If demand remain unchanged on increase in supply will result in A rise in equilibrium quantity The supply is perfectly elastic

Market Price is a situation which The supply is perfectly elastic A rise in equilibrium quantity

The responsiveness of demand to change in price is measured Elasticity of demand In the same proportion

Unit income elasticity implies that asincome rises demand for a commodity rises In the same proportion Elasticity

of demand

Select The Blank

Question Greater scope for the ________ sector may mean incremental ________ , which connotes the expansion of

public sector undertakings, can be left to some private companiesCorrect Answer private

Your Answer investment

Correct Answer disinvestments

Your Answer growth

Multiple Choice Single Answer Question Goods produced on small scale of supply is


Your Answer zero elastic

True/False


Correct Answer True

Your Answer True

True/False

Question Contraction of supply is traced by the downward movement on the supply curve.

Correct Answer True

Your Answer True

True/False

Question The laws of returns to scale explain the behavior of output in response to changes in scale.

Correct Answer True

Your Answer True

True/False

Question In the stage I of the law of diminishing returns, the marginal product goes on increasing

Correct Answer True

Your Answer False


Question Features of monopolistic Competition

Correct Answer Fairly Large number of firms , Product differentiation , Selling costs are existed

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

Select The Blank

Question Where ________ is charging a ________ in the home market and a lower price in the international market, it is

called Dumping

Correct Answer monopolistYour Answer a firm

Correct Answer higher price

Your Answer higher price

Select The Blank Question The number of sellers operating under this type of competition is ________ under oligopoly, but less than under

________

Correct Answer larger than

Your Answer complementary

Correct Answer perfect ompetitionYour Answer perfect ompetition

222




Question Marginal Propensity to consume

Correct 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 the formula mpc= change in C/change in YYour Answer It 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 by change in the consumption expenditure

Multiple Choice Multiple Answer Question InvestmentCorrect Answer It adds to capital equipments , It leads to increase in level of income , It includes new plant and equipment

Your Answer It adds to capital equipments , It leads to increase in level of income , It includes new plant and equipment


Question Features of stage of expansion in business cycle areCorrect Answer Rise in national output , Rise in consumer and capital expenditure , Bank advances grow rapidly

Your Answer Rise in national output , Rise in consumer and capital expenditure , Bank advances grow rapidly


Question Characteristics of DepressionCorrect Answer Decrease in economic activities , The growth rate becomes negative , The level of national income declines

rapidly

Your Answer Decrease in economic activities , The growth rate becomes negative


Question Recession includesCorrect Answer The demand is halted , Increase in production of goods , Inventories piling up in stocks

Your Answer The demand is halted , Inventories piling up in stocks

Multiple Choice Multiple Answer Question The causes of inflation


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

Select The Blank Question The rate of interest, according to ________ , depends upon two factors: (i) ________ and (ii) the quantity of

money

Correct Answer Keynes

Your Answer KeynesCorrect Answer the liquidity preference function

Your Answer the liquidity preference function

Select The Blank

Question In the words of ________ , “inflation occurs when the ________ of prices and cost is rising”.Correct Answer Prof. Samuelson

Your Answer Prof. Samuelson

Correct Answer general level

Your Answer general level



Correct Answer Public Corporations , Departmental management , Company Management or management by boards

Your Answer Departmental management , Public Corporations


Question Specific organizational goals of Firms are:

Correct Answer Maximisation of profit , Reasonable Profit Target , Sales revenue Maximization

Your Answer Maximisation of profit , Reasonable Profit Target , Sales revenue Maximization


Question Individual Demand Schedule:




Question The production function can be explained by:




223



Question Implicit costs are:


Your Answer Cost on self owned resources , Interest on the entrepreneur's own investment

Select The Blank Question Managerial ________s generally refers to the integration of economic theory with ________ practice.

Correct Answer economic


Correct Answer businessYour Answer business

Select The Blank

Question In a competitive industry, there is a large number of firms so that the action of ________ firm has ________ on

the price and output of the whole industry.

Correct Answer a singleYour Answer a single

Correct Answer no effect

Your Answer no effect

Select The Blank Question As per the International Labour Organisation (ILO), _ ________ is a ________ association of individuals with

limited income on the basis of equal rights and responsibilities for achieving certa

Correct Answer Co-operation

Your Answer Co-operation

Correct Answer voluntary

Your Answer voluntary

Select The Blank

Question The word ________ has different meanings to businessmen, ________ , tax collectors, workers and economists

and it is often used in a loose sense that buries its real significanceCorrect Answer Profit

Your Answer Profit

Correct Answer accountants

Your Answer accountants

Select The Blank

Question The demand curve is ________ representation of a demand schedule, demand curve slopes ________ ward

from left to right.

Correct Answer graphicalYour Answer graphical

Correct Answer down

Your Answer down

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

Correct Answer sacrificed

Your Answer commodity

Correct Answer commodity

Your Answer sacrificed



Question Pure public goods are subject to the law of decreasing average cost, because of theCorrect Answer economies of scale



Question In the cost - benefit analysis, after formulating various alternative project capacity, each of them has to be examined interms of its



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


Your Answer True


224











Your Answer Maximization of social welfare , Objective measurement of the trade-off , Maximization of difference between total benefits & total costs


Question 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




Select The Blank


Correct Answer general equilibriumYour Answer general equilibrium

Select The Blank


implementing and running the project smoothly and professionally.Correct Answer management


Select The Blank Question Prof. Sam Nelson calls risks from unsafe factories or nuclear power plants as ________ economies.



Multiple Choice Single Answer Question According to Lionel Robbins, "Economics is a science which studies


Your Answer social behavior



Your Answer Business Economics

Multiple Choice Multiple Answer Question Managerial economics deals with









Select The Blank




225



Select The Blank




Select The Blank




True/False



Your Answer False




Your Answer jointly


Question If the substitutes are relatively costly then the demand for the commodity in question will be

Correct Answer more

Your Answer same

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


Your Answer False

True/False


Correct Answer True

Your Answer True

Select The Blank




Select The Blank




Match The Following







Question Explicit costs areCorrect Answer Out of pocket costs , These are firms accounting expenses , Expenditure costs


Select The Blank



Select The Blank


226






Correct Answer English economistsYour Answer English economists


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

True/False



True/False








Question Features of Pure Competition are

Correct Answer Large number of buyers and sellers , Homogeneous products , Free entry and free exit of firmsYour Answer Large number of buyers and sellers , Homogeneous products , Free entry and free exit of firms



Correct Answer maximum satisfaction , balance , stationaryYour Answer maximum satisfaction , balance


Question Inflation is a phenomena in which pricesCorrect Answer rise

Your Answer rise




True/False

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

Your Answer False

True/False

Question Saving is a private virtueCorrect Answer True

Your Answer True


Question According to Keynes, Aggregate supply function refers toCorrect Answer the minimum price of revenue which the entrepreneurs must get , Associated with different levels of employment ,


Your Answer the minimum price of revenue which the entrepreneurs must get , Associated with different levels of employment ,



Question Marginal Propensity to consume is characterized as follows

Correct 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 the formula mpc= change in c/change in y

Your Answer It is rate of change in the average propensity to consume as income changes , It is derived by the formula mpc=change in c/change in y , It is derived by dividing the change in income by change in the consumption expenditure

227



Question As far as its use is concerned, tuning in of a radio can be categorized as:



True/FalseQuestion In a market system of economy, there is no harmony between individual interests and interests of the

community.


Your Answer False True/False



Your Answer False






Select The Blank




Your Answer micro

Select The Blank




Select The Blank



Your Answer public

Select The Blank





Select The Blank




True/False


Correct Answer True

Your Answer True

True/False



Your Answer False




Your Answer plant





229








Question Co-operative organizations is


membersYour Answer voluntary organization , managed by democratic principle , non profit motive organization

Select The Blank







Correct Answer LIFOYour Answer LIFO

True/False


Correct Answer True

Your Answer True

True/False





Correct Answer income accruing to the equity holders , wages accrue to the labour , rent accrue to the owner Your Answer income accruing to the equity holders , rent accrue to the owner


Question Change in income of a person may result in demand for goods toCorrect Answer change

Your Answer change


Question With decline in price of a commodity, total expenditure spent on the commodity is less than before, thenelasticity of demand for the commodity is

Correct Answer < 1

Your Answer >1




True/FalseQuestion Demand for luxury goods is inelastic


Your Answer False






230



Select The Blank












True/False


Correct Answer True

Your Answer True








Select The Blank




Select The Blank




Select The Blank











Your Answer limited

True/False




True/False





Correct Answer The aggregate behavior of the economy , The behavior of economic agents , Problems such as the rates of inflation, the balance of payments, etc

231




Economic welfare



Your Answer an individual consumer , particular market for a given commodity , major economic issues , problems &

policies






Your Answer open market operations , moral suasion

Multiple Choice Single Answer Question The government has adopted a system of dual prices in the case of




Question The disinvestments of industries is needed for Correct Answer Phased privatization , Reducing deficit , Capital support to plans



Question In India, the first phase of economic reforms is believed to have begun in 1985 when Vishwanath Pratap Singh was the

Prime Minister of the country.


Your Answer False



Your Answer public utilities with legal sanction , personnel services sold , geographical barriers





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


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

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


Your Answer True




Correct Answer 3

Your Answer 3

232





Your Answer Labour , Land , Profit

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

Your Answer Monopolistic competition

Question According to J.M. Keynes, the equilibrium between the aggregate demand function and the aggregate supply functioncan, and often does take place at



Question Important theories of profits are

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








Question Preference share holders get a rate of dividend which is

Correct Answer fixed

Your Answer high





Correct Answer True

Your Answer True


Your Answer sales

Match The Following







233



Question In the traditional concept of equilibrium, a firm attains the equilibrium when the firm’s Total Revenue (T.R.) =Total Cost

(T.C.).


Your Answer True





Question In economics, supply is considered to be a

Correct Answer relative term

Your Answer relative term









Question Steps in cost benefit analysis



Question Slope of supply curve is















Your Answer False


Your Answer True


Correct Answer Board of DirectorsYour Answer Non-government organization



Your Answer joint





234




Your Answer False

Question Poverty is the root cause of Economic problem.



all its citizen’s wants areCorrect Answer insufficientYour Answer insufficient





Correct Answer shawls

Your Answer shawls






Question The registration of a partnership firm is voluntary



Question A responsible factor for inflation isCorrect Answer hike in prices


Question Economists call all human resources asCorrect Answer labor

Your Answer labor










Correct Answer capital

Your Answer capital


Your Answer False

Question Inflation is characterized by excess of demand.





235




Correct Answer True

Your Answer False

Question Main aims of the New Industrial Policy (1991) areCorrect Answer To unshackle the indian industrial economy from the cobwebs of unnecessary bureaucratic control , To introduce



Your Answer To unshackle the indian industrial economy from the cobwebs of unnecessary bureaucratic control , To introduceliberalization with a view to integrate the indian economy with the world economy , To remove restrictions on direct foreigninvestment as also to free the domestic entrepreneur from the restriction of MRTP act

Question Free riders' is a term associated with the people who would like to have benefit of a good without sharing the cost of its

supply.


Question Managerial economics aims at providing help in the firms is






Question The minimum number of directors which private limited should have is ________.Correct Answer 2

Your Answer 2

Question Generally, the larger the income of a consumer, his demand for overall commodities tends to be relatively elastic.Correct Answer False

Your Answer True











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 upward sloping 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.


find out its worth.





Your Answer output

Question An individual consumer or particular market for a given commodity are the subject matter of Correct Answer Micro Economics

236














Correct Answer Land

Your Answer Land

Question Reasons for need of public distribution system areCorrect Answer To maintain stable price conditions , To bring an efficient management of the supply , To supply the necessary




Question Production Function implies relationship betweenCorrect Answer input & output


Question The important determinants of supply areCorrect Answer Always referred to in relation to price & time , Government policy , Availability of factors of production



inCorrect Answer theory of distribution


Question Demand for a commodity depends on the relative price of its ________ Correct Answer substitute goods




Your Answer False





Your Answer Sunk cost










services are topics in theCorrect Answer theory of economic growth

237








Question Implicit costs areCorrect Answer Cost on self owned resources , Costs of salary of the proprietor , Interest on the entrepreneur's own investmentYour Answer Cost on self owned resources , Costs of salary of the proprietor , Interest on the entrepreneur's own investment


Correct Answer Decrease in economic activities , The growth rate becomes negative , The level of national income declines rapidly

Your 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 resources


Your Answer True




Question Break-Even analysis is derived by

Correct Answer Fixed cost , Average variable cost , Quantity of goods and priceYour Answer Fixed cost , Average variable cost , Quantity of goods and price


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





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 True

Your Answer True


Correct Answer True

Your Answer True













238







Question Economic problem arises only in case of an overpopulated country.






economies.


Your Answer True



Your Answer False




Correct Answer forward PlanningYour Answer forward Planning

Match The Following






Question 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 , Prospectus

Your Answer Articles of Association , Prospectus


Correct 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 are accountable to public



Your Answer Input and out put relation , Factors of production and final production , Demand for production






Your Answer public


Your Answer perfect



239








Your 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 True

Your Answer True


Correct Answer All firms dealing in the same line of business , The ownership and management of each firm is different , Is a groupof firms

Your 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 form





Question When a company rasies additional finance by borrowing from the public for a specific period of time at a particular rate

of interest, it is called as


Question In cost benefit analysis, in the valuation of costs and benefits, for finding the present value, one has to make use of




The city acquire the status of a

Correct Answer national marketYour Answer capital market










Question Cournot' , the economists who defined the term 'market' different from that of the traditional sense is anCorrect Answer French economists

Your Answer French economists




Correct Answer True

Your Answer True


Correct Answer True

Your Answer True


240



Correct Answer perfectly elastic



Correct Answer decision makingYour Answer decision making

Question In 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 Answer indivisible in character , cannot be priced in the market


Correct Answer True

Your Answer True

Question The subject matter of macro - economics includes the theory of income and employment at an individual level.


Your Answer False






Match The Following




Tea and sugar Complimentary goods Complimentary goods

Excess demand can be defined as quantity demanded minus quantity supplied quantity demanded minus quantity supplied









Select The Blank



Your Answer limited

Select The Blank









Question Features of Long -run market are



Your Answer It is durable goods market , Supply can be increased or reduced according to the demand , Sellers at least recover minimum price for their goods

241







Select The Blank





Correct Answer Micro Economics


Select The Blank





Question While calculating accounting profit, the costs which are considered are by nature


Your Answer implicit











Correct Answer normativeYour Answer normative



Correct Answer theory of productionYour Answer theory of production

True/False



Your Answer True

Select The Blank

Question Modern economists treat social cost and benefits as ________ of private investment and production decisions.Correct Answer externalities



Question The market system of economy is based on the following foundations:Correct Answer Consumer's Sovereignty , Non-interference by the state. , Private Profit Motive

Your Answer Consumer's Sovereignty , Private Profit Motive , Existence of monopoly

Select The Blank


Your Answer private

Select The Blank

Question The goods become ________ only when each individual has an access to the entire amount of it and its use by theindividual does not reduce its availability to others.

242




Your Answer public


Question 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 substantially benefited.Correct Answer False

Your Answer False

Select The Blank

Question Economists like A.C.Harberger have shown that the cost benefit analysis can be applied to ________ analysis.Correct Answer general equilibrium


True/False

Question Generally, the larger the income of a consumer, his demand for overall commodities tends to be relatively elastic.Correct Answer False

Your Answer False



inCorrect Answer theory of distribution


True/FalseQuestion Supply management is related to the volume ofsupply & its distribution system.

Correct Answer True

Your Answer True









True/False

Question Under the disinvestments process, there is full transfer of ownership

Correct Answer True

Your Answer False







interest, it is called as




Correct Answer Related to few hours or few days , Related to perishable goods , The entire supply is to be disposed off on the sameday

Your Answer Related to few hours or few days , Related to perishable goods , The entire supply is to be disposed off on the same

day

Select The Blank

243

















Correct Answer Demand analysis and forecasting , Production function & cost analysis , Inventory management adverting, pricesystem


system


Question The observation of economic histories of the United States & West European countries shows that competition , the heartof market mechanism gives rise to

Correct Answer monopolies

Your Answer price competition

Match The Following


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



Your Answer are also increasing

True/False

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

Your Answer True


Question Over the years in India the govt. expenditure isCorrect Answer increasing


True/False


Your Answer False

True/False

Question Demand is related to price, time and place.Correct Answer True

Your Answer False



244




Select The Blank




True/FalseQuestion Macro economic studies are based on empirical evidence.

Correct Answer True

Your Answer True

Select The Blank Question According to the World Bank's approach, the trade able items would be valued at the corresponding world prices and the

non-trade able items at the ________.


Your Answer market prices





Multiple Choice Single Answer Question Costs which increase because of the expansion of a firm are called



True/False

Question In the Long- run, supply of goods can be adjusted to the demand and therefore supply curve is horizontal to the X-axis.


Your Answer True

Select The Blank







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


Select The Blank

Question The law of constant returns to scale is depicted by the marginal output curve which is ________.Correct Answer horizontal



Question The method of calculating depreciation in which the actual working hours of a capital asset are taken in to account isCorrect Answer service unit


True/False

Question Demand curve slopes upwards from left to right.Correct Answer False

Your Answer False


Question All the free gifts of nature which are commonly called natural resources are known to economists asCorrect Answer Land

Your Answer Land

True/False

Question Macro-economies is a policy oriented science.Correct Answer True

245



Your Answer True


Question The assumption of perfect competition in all the analytical theories is made by

Correct Answer Classical economistsYour Answer Keynesian economists

Select The Blank

Question In the 3rd stage of operation of the law of variable proportions, the marginal product becomes ________.Correct Answer negativeYour Answer positive



Correct Answer To maintain stable price conditions , To bring an efficient management of the supply , To supply the necessarygoods 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________


Your Answer greater than unity

Multiple Choice Multiple Answer Question Accounting profit includes








Question The method of inventory valuation in which , the cost of production is calculated on the assumption that the material

which was last to enter the inventory of the company was used first is

Correct Answer LIFOYour Answer LIFO

Select The Blank


Correct Answer employee shareholdersYour Answer employee shareholders



Correct Answer larger Your Answer larger



Correct Answer Mounting government expenditure , Deficit financing and increase in money supply , Role of black moneyYour Answer Mounting government expenditure , Deficit financing and increase in money supply , Increase in demand

True/False





Correct Answer productionYour Answer total revenue



Correct Answer Giffen goods , Articles of snob appeal , SpeculationYour Answer Giffen goods , Articles of snob appeal , Speculation

246



Question In the cost - benefit analysis, the first step involved is that the investor has to choose a few project alternatives promising

a

Correct Answer high rate of return

Your Answer high rate of return






Your Answer False


Pure 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










society

Your Answer Addition to the real capital assets , It leads to increase in level of income , Increases accumulated wealth of thesociety



Your Answer social







Question A firm gets an opportunity to produce multiple products because changes in business activity in a firms isCorrect Answer cyclical

Your Answer rapid





Your Answer optimum produce



Your Answer True


247



Correct Answer Type of product , Introduction of new goods , Technology changes

Your Answer Type of product , Introduction of new goods , Advertising by customers

Question The important determinants of supply are

Correct Answer Always referred to in relation to price & time , Government policy , Availability of factors of productionYour Answer Always referred to in relation to price & time , Government policy , Availability of factors of production


Correct Answer backwardYour Answer upward


services are topics in the




Correct Answer Fairly large number of firms , Product differentiation , Selling costs are existed

Your Answer Fairly large number of firms , Product differentiation , Selling costs are existed


Correct Answer True

Your Answer True

Match The Following









LIST OF ATTEMPTED QUESTIONS AND ANSWERS KME3

True/False

Question The damage being done by the factories at and around Agra to Taj Mahal is an example of social cost for private benefit.

Correct Answer True

Your Answer True


Question The Risk theory of profit was developed by

Correct Answer Hawley

Your Answer Hawley








Your Answer upward





248



Select The Blank



Your Answer public







Correct Answer nuclear power plants , gargantuan trucks , unsafe factories

Your Answer nuclear power plants , gargantuan trucks , unsafe factories

Match The Following








Correct Answer substitutes goodsYour Answer complimentary goods

Select The Blank


Correct Answer decreasing returns to scaleYour Answer decreasing returns to scale

True/False

Question A monopolist in a price maker.Correct Answer True

Your Answer True

Select The Blank

Question The chemical effluents recklessly released by a chemical factory in the river causing water pollution, is an example of ________ cost.



True/FalseQuestion The financing of the pure public goods has to be through public expenditure and not through market pricing.

Correct Answer True

Your Answer True

Multiple Choice Single Answer Question A firm is a unit of production, where production is done with the aim to maximize

Correct Answer profits

Your Answer profits

Select The Blank Question By ' profits', the economist means total revenue minus ________.



Multiple Choice Multiple Answer Question Cost-Benefit Analysis is



Your Answer The analysis undertaken to judge the investment of any project , Refers to finding out the worth of investment ,


249



True/False



Your Answer False








Your Answer perfect





Your Answer Price charged should be equal to the marginal cost , Cost price sets the lower limits for firm’s price , Cost priceensures the possible level of profitability

True/False


economies.


Match The Following






True/False


Correct Answer True

Your Answer True



Correct Answer perfectly elastic


Select The Blank

Question The externality which causes an economic gain or an economic loss to other economic units 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 cannot pay the market priceCorrect Answer exclusion


Select The Blank





250




priced

Your Answer They are completely indivisible , Their marginal cost would be zero or close to zero , Their benefits cannot be priced

Multiple Choice Multiple Answer Question Major types of costs are



True/FalseQuestion The short run Average Cost (A.C.) curve is U shaped.

Correct Answer True

Your Answer True

True/FalseQuestion Cyclical fluctuations are recurrent in nature

Correct Answer True

Your Answer True



Your Answer open market operations , changes in statutory reserve ratio

True/False

Question Private profit motive is an essential feature of Capitalism.Correct Answer True

Your Answer True

Multiple Choice Single Answer Question The number of buyers & sellers operating under perfect competition is


Your Answer large




Select The Blank





Question The relation between variable input and ouput

Correct Answer is direct

Your Answer is direct


Question With decline in price of a commodity, total expenditure spent on the commodity is less than before, then elasticity of

demand for the commodity is

Correct Answer < 1

Your Answer < 1





True/False



Your Answer False


Question A downward movement from one point to another point on the same demand curve implies

Correct Answer expansion

Your Answer expansion

251







True/False

Question The concept of economic profit differs from that of normal profit.


Your Answer True

Select The Blank







Your Answer surplus

Select The Blank



Your Answer public






Match The Following








Question The feasibility, which includes the prospects of employment generation, development of backward areas, social

groups comprises of Correct Answer Economic feasibility



Question As far as its use is concerned, tuning in of a radio can be categorized as:Correct Answer Divisible


True/False

Question In a market system of economy, there is no harmony between individual interests and interests of thecommunity.


Your Answer False

True/FalseQuestion Institution of private property is not an essential feature of Capitalism.


Your Answer False


252







Select The Blank



Correct Answer macroYour Answer micro

Select The Blank



Correct Answer exclusionYour Answer exceptions

Select The Blank


the individual does not reduce its availability to others.Correct Answer indivisible

Your Answer public

Select The Blank


plant, machinery, raw materials and technical know how etc.Correct Answer technical


Select The Blank Question In a market economy ________ is the best judge of personal interest.



True/FalseQuestion Inflation reduces the purchasing power of people's income and savings.

Correct Answer True

Your Answer True

True/False



Your Answer False




Your Answer plant












members


Select The Blank




253






Correct Answer LIFO

Your Answer LIFO

True/False



True/False



Your Answer True






Question Change in income of a person may result in demand for goods to


Your Answer change



elasticity of demand for the commodity is

Correct Answer < 1Your Answer >1



Correct Answer substitutes goodsYour Answer substitutes goods

True/False

Question Demand for luxury goods is inelasticCorrect Answer False

Your Answer False

Match The Following






Select The Blank












True/False

254




Correct Answer True

Your Answer True

Multiple Choice Multiple Answer Question The production function can be explained by






Select The Blank Question The costs which cover the cost of advertising is ________.



Select The Blank Question The out of pocket costs are ________.



Select The Blank



Multiple Choice Single Answer Question The supply curve during market period is



Multiple Choice Single Answer Question Under monopoly entry of new firms is


Your Answer limited

True/False



Correct Answer True

Your Answer True

True/False


Correct Answer True

Your Answer True




inflation, the balance of payments, etcYour Answer The aggregate behavior of the economy , Problems such as the rates of inflation, the balance of payments, etc ,

Economic welfare



Your Answer an individual consumer , particular market for a given commodity , major economic issues , problems &

policies





255







True/False



Your Answer True Select The Blank





Select The Blank



Correct Answer macroYour Answer macro

Select The Blank

Question The private sector is owned by ________.

Correct Answer private individuals

Your Answer private individuals

Select The Blank


Correct Answer Giffen goods, ,Your Answer Giffen goods, ,



Correct Answer Labour , Land , CapitalYour Answer Labour , Land , Capital




True/False


Your Answer True


Question According to many economists, the root cause of economic problem isCorrect Answer scarcity

Your Answer inequality

True/False

Question During the phase of depression, the level of national income and expenditure rises rapidly.Correct Answer False

Your Answer False



Your Answer management science




True/False

Question While calculating economic profit, only explicit costs are considered.Correct Answer False

257



Your Answer True

Select The Blank


Correct Answer Selling costYour Answer Selling cost


Question Characteristics of the phase of Depression areCorrect Answer Decrease in economic activities , The growth rate becomes negative , The level of national income declines

rapidly


rapidly



Your Answer partner

Select The Blank Question The index numbers which measure the changes in the general price level of a country refers to ________



Match The Following



exist



bear at all.

The buyers and sellers may be away from each other and yet they may constitute a market over telephone or through internet

yet they may constitute a market over telephone or through internet





True/False



Correct Answer True

Your Answer True



Correct Answer rise

Your Answer rise



Correct Answer larger

Your Answer lesser




Your Answer Input and out put relation , Factors of production and final production , Technology used in production


Question The economic stabilization means



258



Your Answer Preventing excessive economic fluctuations , Efficient utilization of labor and other factors of production ,



Question The effective solution to the problem of internationalizing of externality involvesCorrect Answer Government action , Private action providing correctives , Externality taxes

Your Answer Government action , Private action providing correctives , Externality taxes

Multiple Choice Multiple Answer Question Different types of Elasticity of Demand areCorrect Answer Price elasticity of demand , Income elasticity of demand , Cross elasticity of demand

Your Answer Price elasticity of demand , Income elasticity of demand , Perfectly elastic demand


Question Objectives of economic policy areCorrect Answer To increase the efficiency and international competitiveness of industrial production , To improve the


Your Answer To increase the efficiency and international competitiveness of industrial production , To improve the





inflation, the balance of payments, etc


Economic welfare

True/False



True/False




Question Production Function implies relationship betweenCorrect Answer input & output

Your Answer supply & quantity demanded

Match The Following


Joint – sector enterprises Hindustan Machine Tools Baumol

State enterprises Public welfare Hindustan Machine Tools

The Homeostatic theory Prof. Kenneth Boulding Cyert R.M. and J.G. March

Satisfying behavior Cyert R.M. and J.G. March Prof. Kenneth Boulding


Question The production function can be studied in three ways

Correct Answer Law of variable proportion , Laws to return to scale , Optimum combination of inputs

Your Answer Law of variable proportion , Laws to return to scale , Optimum combination of inputs



Correct Answer Effective demand , Aggregate supply , Aggregate demand

Your Answer Effective demand , Aggregate supply , Aggregate demand






259



Question The profit which is surplus of revenue over and above all paid out cost is


Your Answer Economic Profit


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.



True/False

Question In the Long- run, supply of goods can be adjusted to the demand and therefore supply curve is horizontal to theX-axis.


Your Answer False

Multiple Choice Multiple Answer Question The market system of economy is based on the following foundations:

Correct Answer Consumer's Sovereignty , Non-interference by the state. , Private Profit Motive

Your Answer Consumer's Sovereignty , Private Profit Motive


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


Select The Blank Question If the output rises in the greater proportion than that of the increase in factor inputs, it is referred to as

________.



Select The Blank




Select The Blank


optimal policy aiming at this goal.

Correct Answer net wealthYour Answer gross domestic product

Match The Following


Resource allocation decisions in free market economy Theory of price Reduction in purchasing power

Economic problem Universal Involuntary unemployment


Inflation Reduction in purchasing power Theory of price

Waste of resources Involuntary unemployment Universal

True/False

Question Poverty is the root cause of Economic problem.


Your Answer True




priced

260



Your Answer They are completely indivisible , Their marginal cost would be zero or close to zero , Their benefits cannot be

priced




True/FalseQuestion In a market system of economy, there is no harmony between individual interests and interests of the

community.


Your Answer True

Multiple Choice Multiple Answer Question Marginal cost pricing explains that the









Your Answer It is a wave like movement , These fluctuations are recurrent in nature , Expansion and contraction in tradecycle are cumulative in effect


Question The advantage of cost-benefit analysis areCorrect Answer Maximization of social welfare , Objective measurement of the trade-off , Maximization of difference between


Your Answer Objective measurement of the trade-off , Maximization of difference between total benefits & total costs ,

Maximization of social welfare


Question In economics, the problem related to the selection of methods for producing different commodities is a subject

matter of the

Correct Answer Theory of productionYour Answer Theory of production

True/False



True/False





Correct Answer normativeYour Answer normative

True/False

Question Under perfect competition, price is determined by the interaction of total demand and total supply in the market.


True/False

Question To solve the unemployment problem , the level of effective demand must decrease.


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)

261




Match The Following







True/False

Question In market period supply is elastic.


Your Answer True

Select The Blank










Correct Answer compulsory

Your Answer compulsory


Question The features of a partnership firm are

Correct Answer Joint Ownership , No Remuneration to the partners , Unlimited liabilityYour Answer Joint Ownership , Unlimited liability , Service Motive




Select The Blank



Select The Blank


as ________ externality.Correct Answer Pecuniary



Question Exceptions to the Law of Demand areCorrect Answer Giffen goods , Articles of snob appeal , Speculation


Select The Blank





262






Correct Answer total demandYour Answer total demand


Question The slope of Supply curve of labour is alwaysCorrect Answer backwardYour Answer backward

Select The Blank



True/False




Question In a market economy, a firm in the private sector basically aims at maximization of

Correct Answer money profits

Your Answer money profits



Correct Answer opportunity costYour Answer opportunity cost



Correct 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 principle of pricing , on the basis of

infrastructure

Multiple Choice Single Answer Question The feasibility, which includes the prospects of employment generation, development of backward areas, social

groups comprises of





Correct Answer Related to few hours or few days , Related to perishable goods , The entire supply is to be disposed off on the

same day

Your Answer Related to few hours or few days , Related to perishable goods , The entire supply is to be disposed off on thesame day

Select The Blank




Question Cournot' , the economists who defined the term 'market' different from that of the traditional sense is an

Correct Answer French economistsYour Answer French economists


Question The act of production involves

Correct Answer transformation of inputs into outputsYour Answer transformation of inputs into outputs

True/False

Question The government also fixes minimum procurement prices for major crops on the recommendation of the

Agricultural Prices Commission (APC).Correct Answer True

263



Your Answer True


Select The Blank



Your Answer horizontal Multiple Choice Single Answer








Select The Blank


economic units.

Correct Answer Third party


Select The Blank



Your Answer life-cycle theory.

True/False



Your Answer True


Question Different types of business organizations are

Correct Answer private sector , public sector , joint sector Your Answer private sector , public sector , joint sector

True/False

Question Saving is a private virtue


Select The Blank


Correct Answer individualYour Answer individual




Your Answer Addition to the real capital assets , It leads to increase in level of income , Increases accumulated wealth of the

society

Select The Blank Question Negative slope means curve slopes downwards from________

Correct Answer left to left

Your Answer left to left

True/FalseQuestion The externalities that may be an economic gain or economic losses to other economic units are referred to as

technological externalities.


Your Answer False

Select The Blank

264








Your Answer profit

Multiple Choice Single Answer Question Firm is an


Your Answer economic unit

Multiple Choice Single Answer Question In cost - benefit analysis, after the step of appraisal and selection of the project is the step of



Multiple Choice Single Answer Question The cost recorded in the books of accounts are considered as









Multiple Choice Multiple Answer Question Under cost plus pricing



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



Correct Answer It is a wave like movement , These fluctuations are recurrent in nature , Expansion and contraction in tradecycle are cumulative in effect





Your Answer cost to the society.

Multiple Choice Multiple Answer Question Characteristics of Pure Public goods are:


priced

Your Answer They are completely indivisible , Their marginal cost would be zero or close to zero , Principle of Exclusion

applies to them

Match The Following






265




Multiple Choice Single Answer Question Variable cost are those costs which vary with the level of


Your Answer output

Multiple Choice Single Answer Question Goods produced on large scale have



Multiple Choice Multiple Answer Question Scope of Managerial Economics deals with

Correct Answer Demand analysis and forecasting , Production function & cost analysis , Inventory management adverting, price

system


system

Select The Blank


________





Correct Answer the minimum price of revenue which the entrepreneurs must get , Associated with different levels of employment , Explains that the level of out put varies with the level of employment

Your Answer the minimum price of revenue which the entrepreneurs must get , Associated with different levels of


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


Your Answer True

Select The Blank






Question Liability of a sole trader is



True/False



Your Answer False




Your Answer future

True/False


Correct Answer True

Your Answer False



Correct Answer Related to few hours or few days , Related to perishable goods , The entire supply is to be disposed off on the

same day

266



Your Answer Related to few hours or few days , Related to perishable goods , The entire supply is to be disposed off on the

same day

True/False

Question There is considerable slush money with politicians & Government servants.Correct Answer True

Your Answer True

Multiple Choice Single Answer Question According to J.M. Keynes, the equilibrium between the aggregate demand function and the aggregate supply





Cost benefit analysis Maximization of net wealth Measure to reduce externality


Unplanned shocks & disturbances Free enterprise system Free enterprise system

Unemployment, inflation Economic evils Economic evils

True/False

Question Changes in the value of money because of inflation make inventory valuation of finished products difficult.

Correct Answer True

Your Answer True





Select The Blank





Correct Answer Cost on self owned resources , Costs of salary of the proprietor , Interest on the entrepreneur's own investmentYour Answer Cost on self owned resources , Costs of salary of the proprietor , Interest on the entrepreneur's own investment


Question the concept ,of Perfect competition includes all the features of

Correct Answer Pure competitionYour Answer Pure competition




Select The Blank


Correct Answer decreaseYour Answer decrease

True/False

Question Demand and desire are one and the same.



Select The Blank

267









Your Answer environmental Multiple Choice Single Answer






demand

Correct Answer is not all affected



Question J.M. Keynes, on the basis of a fundamental psychological law of consumption, observed that as income

increases, consumption also increases, but proportionately

Correct Answer less

Your Answer less

Select The Blank





Correct Answer It aims at maximization of social welfare , In this principle, the problem of infinite target value does not arise ,It shows the measures necessary for attaining maximum net wealth

Your Answer It aims at maximization of social welfare , In this principle, the problem of infinite target value does not arise ,





Your Answer Rise in national output , Rise in consumer and capital expenditure , Bank advances grow rapidly

Match The Following


Pure public good Economies of scale Externalities

Consumer's sovereignty Market economy Market economy

Benefits of widespread public health Market economy Social cost

Emergence of slums Social costNeighborhood

Select The Blank

Question According to the World Bank's approach, the trade able items would be valued at the corresponding world

prices and the non-trade able items at the ________.Correct Answer shadow prices


True/False

Question Public enterprises have shown a very high rate of return of the capital investedCorrect Answer False

Your Answer False


Question The enterprenuer gets Pure Profit for Correct Answer undertaking risk & uncertainity , for co-ordination & organizing production , for innovation

268



Your Answer undertaking risk & uncertainity , for innovation , for generating employment

Select The Blank




Question The Keynesian Theory isCorrect Answer demand orientedYour Answer demand oriented

Select The Blank



True/False

Question The demand for life saving drugs is elastic.






Select The Blank



Match The Following









Your Answer Labour , Land , Capital









Select The Blank


Correct Answer 2

Your Answer 2






269



True/False



Your Answer False


Question The economic stabilization means


Encouraging free competitive enterpriseYour Answer Preventing excessive economic fluctuations , Efficient utilization of labor and other factors of production ,




Correct 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

True/False








Question Diseconomies of small scale production includes

Correct Answer High average cost of production in initial stages , Workers in the factory take some time to adjust with newtechniques of production , Wastage of raw material & power

Your Answer High average cost of production in initial stages , Workers in the factory take some time to adjust with new





True/False

Question The subject matter of macro – economics includes the theory of income and employment at an individual level.


Your Answer False

True/False



Your Answer False




Your Answer it is controlled by the state , they are accountable to public , unprofitable motive

True/False

Question Under the New Industrial Policy, Public enterprises which are chronically sick and which are unlikely to be

turned were referred to BIFR

Correct Answer True

Your Answer True

Select The Blank



Your Answer expand


Question One of the serious limitations of market mechanism is that it results in distribution of income and wealth which

is

Correct Answer unequalYour Answer unequal

270






membersYour Answer voluntary organization , managed by democratic principle


Question Macro economics is the study of theCorrect Answer aggregate behavior of economyYour Answer aggregate behavior of economy


Question The Risk Taking Theory was developed by Hawley, who was an

Correct Answer American EconomistYour Answer American Economist

True/False

Question The financing of the pure public goods has to be through public expenditure and not through market pricing.


Select The Blank




True/False



Select The Blank




Question According to Keynes there are three motives for holding cash for liquidity preferenceCorrect Answer the transactions motive , the precautionary motive , the speculative motive

Your Answer the transactions motive , the precautionary motive , the speculative motive


Question The production function studiesCorrect Answer Input and out put relation , Factors of production and final production , Technology used in production

Your Answer Input and out put relation , Factors of production and final production , Technology used in production


Question If the substitutes are relatively costly then the demand for the commodity in question will beCorrect Answer more

Your Answer more


True/False

Question During the period of depression, demand for bank credit reaches its low level and banks experience mounting of

their cash balances.





Your Answer >1

Match The Following


271




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

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

The market period supply curve for perishable commodities is perfectly inelastic. downward from right to left

True/FalseQuestion During the period of depression, a large part of a country’s resources lie involuntarily idle.

Correct Answer True

Your Answer True

Multiple Choice Multiple Answer Question The payments made out of the Gross Profit are


Your Answer Remuneration to factors of production , Depreciation , Maintenance Charges , Capital expenditure


Public Sector Life Insurance Corporation Co-operative Farming Societies

Competitive Industry Homogenous Product Life Insurance Corporation

Monopoly Firm One Firm Homogenous Product

Plant Technical Unit Technical Unit




Your Answer Changes in the supply of capital , Changes in population , Changes in the techniques of production , Changes indemand patterns

True/False

Question While calculating economic profit, only explicit costs are considered.Correct Answer False

Your Answer True


Question Important theories of profits areCorrect Answer Risk taking theory , Uncertainty-bearing theory of profit , Dynamic theory of profit



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


True/False

Question When demand and supply rise and fall in the same proportion, the equilibrium price changes.Correct Answer False

Your Answer False









272





Your Answer what commodities to produce and in what quantities? , by what methods are the commodities produced? , Is


Select The Blank


private and find out its worth.

Correct Answer investmentsYour Answer investments





True/False



Your Answer True



Correct Answer To increase the efficiency and international competitiveness of industrial production , To improve the


Your Answer To increase the efficiency and international competitiveness of industrial production , To improve the performance and rationalize the scope of the public sector , To reform and modernize the financial sector

Select The Blank




True/FalseQuestion Cyclical fluctuations are recurrent in nature

Correct Answer True

Your Answer True















Question The form of market in which there is monopoly of two firms is known as

Correct Answer duopoly

Your Answer monopoly


Question A group of firms dealing in the same line of business are called as

Correct Answer Industry

Your Answer Industry

Select The Blank



Correct Answer divisibleYour Answer profitable

273



True/False


Correct Answer True

Your Answer True



Correct Answer Agriculture, , Retail trade, , Hotel,Your Answer Retail trade,




Correct Answer divisible goodYour Answer divisible good


Question Various binds of economic policies are

Correct Answer Industrial liscencing policy , Commercial policy , Fiscal policyYour Answer Industrial liscencing policy , Commercial policy , Fiscal policy

True/False







Your Answer Is the Study of aggregate demand and aggregate supply

Multiple Choice Single Answer Question According J.B.Clark, profit is the reward paid for



Select The Blank


economic units.

Correct Answer Third party






Select The Blank







factors can be changedYour Answer All factors can be changed

True/False

Question Under perfect competition there are large number of buyers and few sellers.




Correct Answer Principle of Exclusion applies to themYour Answer Decisions about them cannot be taken through market mechanism

274



Select The Blank



Your Answer Proprietorist


Question Suggestion of maximization of sales revenue as an alternative objective to profit maximization is given by

Correct Answer BaumolYour Answer Baumol

Select The Blank



Your Answer private


Question The features of a partnership firm are

Correct Answer Joint Ownership , No Remuneration to the partners , Unlimited liability

Your Answer Joint Ownership

Select The Blank




True/False



Your Answer False




Your Answer Rise in national output , Rise in consumer and capital expenditure , Bank advances grow rapidly , Contractionof credit


Select The Blank


the individual does not reduce its availability to others.Correct Answer indivisible


True/False

Question While Disinvestments process, Government retains 50% of the equity with itself & transfers 49% to privatesectors


Your Answer False

Multiple Choice Multiple Answer Question The firm may be defined as





True/False


Correct Answer True

Your Answer True





275



Select The Blank

Question Sole Proprietorship which is also called sole ________






Your Answer Practice Multiple Choice Multiple Answer


Correct Answer the minimum price of revenue which the entrepreneurs must get , Associated with different levels of


Your Answer the minimum price of revenue which the entrepreneurs must get , Associated with different levels of employment , Explains that the level of out put varies with the level of employment




True/False


Correct Answer True

Your Answer True



Correct Answer Monopoly , Duopoly , OligopolyYour Answer Monopoly , Duopoly , Oligopoly

Select The Blank




Question The pioneering analysis of imperfect competition was done by Mrs. Jaon Robinson from theCorrect Answer Cambridge University

Your Answer Cambridge University

Select The Blank

Question According to the World Bank's approach, the trade able items would be valued at the corresponding world prices and the non-trade able items at the ________.










Question In cost - benefit analysis, after the step of appraisal and selection of the project is the step of Correct Answer comparison of the cash flow




276




unchanged


unchanged









True/False



Your Answer False

True/False

Question A Joint Stock Company has perpetual succession.

Correct Answer True

Your Answer True

Multiple Choice Multiple Answer Question The production function studies


Your Answer Input and out put relation , Factors of production and final production , Demand for production

Match The Following












Question The production function can be studied in three ways

Correct Answer Law of variable proportion , Laws to return to scale , Optimum combination of inputs

Your Answer Law of variable proportion , Laws to return to scale , Optimum combination of inputs

True/False

Question Demand is related to price, time and place.

Correct Answer True

Your Answer True









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

277



True/False

Question While calculating economic profit, only explicit costs are considered.


Your Answer False



Correct Answer opportunity costYour Answer opportunity cost

Select The Blank





Question One of the serious limitations of market mechanism is that it results in distribution of income and wealth which

is

Correct Answer unequalYour Answer unequal




Your Answer public utilities with legal sanction , personnel services sold , geographical barriers



Correct Answer English economistsYour Answer English economists

Select The Blank



Select The Blank



True/False

Question Inflation reduces the purchasing power of people's income and savings.Correct Answer True

Your Answer True

Select The Blank

Question In the 3rd stage of operation of the law of variable proportions, the marginal product becomes ________.Correct Answer negative


Select The Blank



True/False

Question Supply management is related to the volume ofsupply & its distribution system.Correct Answer True

Your Answer True


Question Individual Demand ScheduleCorrect Answer Is in tabular form , It shows the prices of goods , It shows the quantities of a commodity purchased



Question Explicit costs areCorrect Answer Out of pocket costs , These are firms accounting expenses , Expenditure costs

278





Question All the buyers and sellers operating under perfect competition have knowledge which is

Correct Answer perfectYour Answer perfect


Question A place where buyers & sellers meet each other to effect a business transaction is known asCorrect Answer MarketYour Answer Market

Select The Blank


example of ________ cost.Correct Answer social

Your Answer social

Select The Blank

Question On the ________ level, the summation of maximum individual welfare does not automatically lead tomaximum social welfare.


Your Answer macro

True/False

Question Changes in the value of money because of inflation make inventory valuation of finished products difficult.Correct Answer True

Your Answer True

Skipped questions13. When the quantity of variable input increases the output also

increases

decreases

remains same

gets postponed16. Match The Following :

1. Disinvestments 1. No restriction on direct foreign investment

2. Steel 2. Administered price

3. Black money 3. Restriction on direct foreign investment4. New Industrial Policy 1991 4. Denationalization of the P.S.U.

5. Smuggling

6. Procurement price system

38.

1. Sole proprietorship 1. State control2. Preference shares 2. No dividend

3. Public enterprises 3. Unlimited liability

4. N.G.O.S 4. Voluntary social work

5. Reasonable profits

6. Fixed rate of dividend

279

manger i al economics 11

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