MCQ on Managerial Economics 4

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Objective Questions and Answers of MBA: MCQ on Managerial Economics 4

Subject: MCQ on Managerial Economics 4

Part 4: List for questions and answers of Managerial Economics

 

Q1. At the shut-down point

a) The total losses of the firm equal TFC

b) TR = TVC

c) P = AVC

d) All of the above

 

Q2. One way the government can induce a monopolist to expand his output is by imposing

a) A price floor that makes the monopolist raise his price

b) A price ceiling that makes the monopolist lower his price

c) A specific tax on the monopolist’s output

d) A heavy tax on the monopolist’s profits

 

Q3. When the consumer’s income increases, the budget line on an indifference map moves to

a) A parallel position to the right

b) A parallel position to the origin

c) A parallel position to the left

d) None of the above

 

Q4. Bilateral monopoly means

a) A monopoly seller buying his input from many suppliers

b) Two rival buyers only

c) Two rival sellers only

d) A monopolist facing a monopsonist

 

Q5. The equilibrium level of output for the pure monopolist is where

a) MR = MC

b) P less than AC

c) MR greater than MC

d) MR greater than MC

 

Q6. The LAC curve is tangent to the lowest point on the SAC curves when the LAC curve is

a) Rising

b) Falling

c) At its minimum

d) None of these 

 

Q7. Marginal utility approach’ was finalised by

a) A. C. Pigou

b) Alfred Marshall

c) J. S. Mill

d) J. R. Hicks

 

Q8. Under perfect competition, a firm will be in equilibrium when its AC is

a) Covering only prime costs of production

b) At a minimum

c) At a maximum

d) Covering wages and salaries only

 

Q9. The imposition of a ceiling on a monopolist’s price will affect his

a) Equilibrium output only

b) Average revenue in the short-run only

c) Profits only

d) Equilibrium output and profits

 

Q10. In perfectly competitive market

a) Firm is the price giver and the industry the price-taker

b) Firm is the price-taker and industry the price giver

c) Both are the price-takers

d) None of these

 

Q11. Normal profits are considered as

a) Social costs

b) Implicit costs

c) Explicit costs

d) Both (b) and (c)

 

Q12. A profit-maximising monopolist in two separate markets will

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

b) Always charge a higher price in the market where he sells more

c) Charge the same price in both markets

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

 

Q13. Increasing returns imply

a) External economies

b) Diminishing cost per unit of output

c) Optimum use of capital and factor

d) Constant average cost

 

Q14. All of the following curves are U-shaped except

a) The AC curve

b) The AFC curve

c) The AVC curve

d) The MC curve

 

Q15. External economies are witnessed in

a) A falling demand curve

b) A rising demand curve

c) A falling supply curve

d) A rising supply curve

 

Q16. By “normal profits” is meant

a) The surplus profit made by the least efficient firms

b) The payment made to the marginal entrepreneur for his abilities

c) The profit made by the marginal entrepreneur in a normal year

d) The payment needed to keep an entrepreneur in an industry

 

Q17. If a single monopolist enjoying internal economies of scale is replaced by a large number of producers operating under perfect competition, it may be said that

a) Both price and output will rise

b) Price will increase and output will fall

c) Price will increase but the effect on output will be indeterminate

d) Output will fall but the effect on price will be indeterminate

 

Q18. In all forms of imperfect competition the average revenue curve facing the individual slopes

a) Horizontally

b) Downward

c) Upward

d) Vertically 

 

Q19. Which of the following is one of the assumptions of the indifference curve analysis?

a) Independent utility

b) Ordinal utility

c) Cardinal utility

d) Constant marginal utility of money

 

Q20. Under price discrimination, price will be higher in the market where demand is

a) Highly elastic

b) Unitary elastic

c) Less elastic

d) None of the above

 

Part 4: List for questions and answers of Managerial Economics

 

Q1. Answer:d

Q2. Answer:b

Q3. Answer:a

Q4. Answer:d

Q5. Answer:a

Q6. Answer:c

Q7. Answer:b

Q8. Answer:b

Q9. Answer:d

Q10. Answer:b

Q11. Answer:d

Q12. Answer:d

Q13. Answer:b

Q14. Answer:b

Q15. Answer:c

Q16. Answer:d

Q17. Answer:c

Q18. Answer:b

Q19. Answer:b

Q20. Answer:c