Managerial Economics Consolidated

Managerial Economics List of Attempted Questions and Answers  Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question   Single Answer Single Answer Single Answer Single Answer Single Answer Single Answer   Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Match The Following   Question   Dual prices Inflation P.D.S. R.B.I. The consumers’ Protection Act 1986  Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   Cross demand is the change in the quantity demanded of a given commodity in response to the Incase there were no changes in the quantity of food sold even when its price had fallen we would know that The elasticity of demand for product will be higher The law of demand indicates The law of demand states  Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer   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that slopes In case of Giffen goods like bajra a fall in price tends to  True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    True/False   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Match The Following   Question   Prosperity Statutory reserve ratio The general theory of employment, Interest and money Trade cycle  True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Match The Following   Question   Commodities General Theory of Employment, Interest and Money Human wants Managerial economics Resources  Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    True/False   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   Equilibrium price is the price where the Excess demand can be defined as Excess supply can be defined as Tea and sugar  Match The Following   Question   Commodities Human wants Managerial economics Resources  True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single 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Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   A demand curve, which takes the form of a horizontal line parallelto the quantity axis illustrates elasticity Cross elasticity of demand between two perfect substitute will be Income consumption curve Inelastic demand curve Normal demand curve  True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Match The Following   Question   Aggregate Demand Function Effective Demand Keynesian theory Statutory Reserve Ratio Trade cycle  Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple 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  Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    True/False   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   Demand curve under oligopoly is Going rate pricing Marginal cost pricing Perfect competition  Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   According to J. M. Keynes, there are two factors determining the investment function, Rise in costs due to an increase in factor prices The point of effective demand is the point when Trade Cycle  Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Select The Blank   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   Joint – sector enterprises Satisfying behavior State enterprises The Homeostatic theory  Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   Contraction of Demand Decrease in Demand Extension of demand Increase in demand  True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   Economic problem Elasticity of demand Managerial Economics Natural Resources Resource allocation  Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   Managerial Economics aims at Managerial economics generally refers to Managerial Economics is Managerial economics lies on managerial economics which explain various concepts  Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   Implicit costs are the cost Opportunity costs are also known as The difference between average cost and average revenue is The difference between average total cost &average fixed cost shows  Select The Blank   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    True/False   Question     Correct Answer    Match The Following   Question   N.G.O.S Preference shares Public enterprises Sole proprietorship  Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   Authorized capital refers to Issued capital refers to that part public of the authorized capital Paid – up capital is that part of the subscribed capital Subscribed Capital is  Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   Firm Partnership Proprietary firms Railways  True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    True/False   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    True/False   Question     Correct Answer    Match The Following   Question   Choice is fundamental to Economic behavior because If there were no scarcity by Economic goods and services it would mean that Micro-economics deals Primarily with Society faces economic problems The fundamental economic problem being faced  Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    True/False   Question     Correct Answer    Match The Following   Question   Indian Railways Long Run Losses Market period Super normal profit  Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   What is consumption? What is meant by a consumer? What is meant by a producer? What is meant by the term commodities? What is production?  True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   Cost benefit analysis Macro economic policy Unemployment, inflation Unplanned shocks & disturbances  Match The Following   Question   A monopolist gets In oligopoly market, price The price policy of a public enterprise should be such as Under monopolistic competition,  Match The Following   Question   Authorized capital refers to Issued capital refers to that part public of the authorized capital Paid – up capital is that part of the subscribed capital Subscribed Capital is  True/False   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer   Multiple Answer Multiple Answer Multiple Answer Multiple Answer  Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   Defence service Economic effects of public goods are Production possibility frontier Selection or implementation  Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   Diamond Index number Rigid demand Variation in demand  Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Match The Following   Question   At the saturation point for a commodity x the Mux is Marginal utilities are Marginal utility Total utility increases marginal Total utility is  Select The Blank   Question     Correct Answer     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   Division of society’s output of goods and services Managerial Economics Motor cars Resources Wants  Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Match The Following   Question   Excess supply can be defined as If demand remain unchanged on increase in supply will result in Market Price is a situation which The responsiveness of demand to change in price is measured Unit income elasticity implies that asincome rises demand for a commodity rises  Select The Blank   Question     Correct Answer     Correct Answer    True/False   Question     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Select The Blank   Question     Correct Answer     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Select The Blank   Question     Correct Answer    True/False   Question     Correct Answer    Match The Following   Question   Excess capacity Public enterprises may incur some social costs The buyers and sellers may be away from each other and Under perfect competition, it is assumed that the  Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question   Single Answer Single Answer Single Answer Multiple Answer   Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Match The Following   Question   Accounting profit Economic profit Reduction in demand due to a new substitute in market Risk taking theory  Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Match The Following Single Answer Single Answer Single Answer Single Answer   Question   Benefits of widespread public health Consumer's sovereignty Emergence of slums Pure public good  Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   In oligopoly market, price Monopsony is the monopoly Public utilities such as railway or cooking gas supply companies The price policy of a public enterprise should be such as Under monopolistic competition  Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   Monopolistic competition Monopoly Selling cost curve Selling costs  Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Match The Following   Question   Equilibrium price Long run Market period Perfect competition  Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   A rightwards shift in supply schedule indicates Any straight line supply curve which cuts y axis will have Normally the isoquant slopes The market period supply curve for perishable commodities is  Match The Following   Question   Competitive Industry Monopoly Firm Plant Public Sector  Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   Inflation P.D.S. R.B.I. Railway freight rates  Match The Following   Question   In contrast to J. M. Keynes, J. M. Keynes believed in the Keynesian analysis takes The speculative motive  Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Match The Following   Question   Danger from drunken drivers Impure public goods Pure private goods Self -interest  True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Match The Following   Question   Administered prices Non-price competition Prestige price Pricing in cooperative societies  Select The Blank   Question     Correct Answer    True/False   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    True/False   Question     Correct Answer    Match The Following   Question   MC is given by Average total unit cost curve means Each short run average cost curve Marginal cost curve  Multiple Choice Single Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Select The Blank   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer    True/False   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer 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Single Answer Single Answer Single Answer Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    True/False   Question     Correct Answer    Multiple Choice Multiple Answer   Question     Correct Answer   Managerial Economics ist of Attempted Questions and Answers Managerial economics generally refers to the integration of economic theory with business Practice 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 insufficient Managerial economics is also understood to refer to applied economics The type economic problem is Universal The act of making goods and services is called production The act of using goods and services to satisfy wants is called Consumption The things that are produced by factors of production are called Commodities The concept of just distribution of national product is a normative A firm under perfect competition is a price maker False When demand and supply rise and fall in the same proportion, the equilibrium price changes. False Market means a particular area where buyers and sellers meet False Goods which are completely divisible and to them the principle of exclusion applies in full measure are Pure private goods Market system of economy is characterized by consumer’s sovereignty In case of a proprietary firm the liability of the proprietor is limited False Macro – economics provides an exploration to the functioning of an economy in general The subject matter of macro – economics includes the theory of income and employment at an individual level False   Correct Answer   Two different prices Deficit financing Essential commodities General and selective credit control measures Right to information Depreciation is the value caused by the continuous use of a capital asset is loss Accounting profit takes in to account opportunity cost. False According to Prof Knight, profit is the reward for uncertainty bearing. True According to J.B. Clark, profit is the reward paid to the entrepreneur for dynamism. True Complementary goods are demanded jointly   Correct Answer   Change in the price of anothercommodity Demand was entirely inelastic The more available are substitutes for that product Relationship between the price of a commodity and the quantity Demanded When price falls demand rises As per the law marginal product becomes negative when total product falls The law of diminishing returns is applicable to agriculture provided the state of technology is given and constant 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 fair Quantitative credit control measures such as ________ operations, change in the bank rate, and changes in the ________ ratios open market statutory reserve AVC is the per unit variable cost of production 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. True The laws of returns to scale explain the behavior of output in response to changes in scale. True An Industry Is a group of firms , All firms dealing in the same line of business , The ownership and management of each firm is different Dumping 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 Under perfect competition, ________ is determined by the interaction of total ________ and total supply in the market price demand Advantages of Cost-Benefit Analysis 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 Effective Demand 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 According to Prof. Ackley, “________ economics deals with economic affairs in the large it concerns the ________ of economic life”. macro overall dimensions Different types of business organizations are; Private sector. , Public sector. , Joint sector. Distinction between private sector and public sector is determined On the basis of economic system , On the basis of motive , On the basis of principle of pricing Methods of Demand forecasting for new Products are: Product life Cycle Analysis , Test Marketing , Evolutionary Approach Index numbers may broadly be classified as: Price indices , Quantity Indices , Special purpose indices Economics is a ________ , which studies human behaviour as a relationship between ________ , which have alternative uses. science ends and scarce means The production function is the name given to the ________ between the rates of ________ of productive services and rate of output of a product relationship input Internal economies are those advantages of large- scale ________ , which accrue to a ________ on account of its superior techniques and management production firm 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. proportionate change 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 Production costs Selling costs 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 expansion sunk The indivisible goods, whose benefits cannot be priced, and therefore, to which the principle of exclusion does not apply, are called Pure public goods The causes of inflation are :Increase in public expenditure , Increase in private expenditure , Increase in foreign demand   Correct Answer   Principle of exclusion and benefit of good to all without sharing cost Freely fluctuating price mechanism Social costs Indivisible goods By ' profits', the accountant means total revenue minus________. Explicit costs A Joint Stock Company has perpetual succession. True We say that a nation faces economic problems , under following conditions Man has unlimited wants or ends , The means or resources to satisfy them are limited , These resources are not specific but have alternative uses Gross profit is the excess of total revenue of a firm over total expenditure Demand forecasting is predicting for the demand of a firm’s product in future A fall in price tends the demand for goods to ________ expand The main criterion of indivisibility of a good is that the good 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. Reasons for change in Demand (Increase or Decrease in Demand) Change income of consumer , Change in population , Change in fashion and customs Defence service is an example of ________ good. indivisible Features of Market are 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 In the measurement of profit, the differences in the concept of profit arise due to differences in cost concepts. True Resources are said to be involuntarily un employed when their wastage occur. True In general, the demand for necessaries is relatively inelastic One of the most disturbing characteristics of free – market economies is that waste of resources some times occurs True At the level of the society, the macro economic objectives are economic stabilization , employment generation , poverty reduction Under perfect competition,firms are free to enter and exit in the market. True The indivisible goods whose benefits cannot be priced are called Pure public goods Contraction of supply is traced by the downward movement on the supply curve True There are no real exceptions to the law of demand False There is considerable slush money with politicians & Government servants. True Major types of costs are Accounting costs , Economic costs , Opportunity costs Forms of Public Enterprises Departmental management, Company Management or management by boards, Public Corporations The income which a businessman might expect from the second best alternative use of his resources is called as opportunity cost The social costs and benefits are the external economies and diseconomies resulting from the ________ activities, which are known as, "externalities" firm's The characteristics of Inflation are Excess of demand , Sustained rise in prices , Cannot be anticipated A normal demand curve has ________+B299 negative slope Cost-benefit analysis refers to the analysis undertaken to judge any projects ________ whether government or private and find out its worth. investments   Correct Answer   a rise in consumers real income. upwards to right upwards to right. reduce the demand Cyclical fluctuations are recurrent in nature True The government has adopted a system of dual prices in the case of essential goods 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.' True Market economy or private enterprise economy is a economy which is planless Features of an Industry are All firms dealing in the same line of business , The ownership and management of each firm is different , Is a group of firms Supply curve shifts to the right side of the original supply curve when, the supply increases Supply is predominantly determined by ________. Stock The index numbers which measure the changes in the general price level of a country refers to ________ Wholesale prices index The federal government of U.S.A. does not face the basic economic problem. False “Homeostatic Approach” as an alternative objective of firms was suggested by _________. Prof. Kenneth Boulding In cost benefit analysis, in the valuation of costs and benefits, for finding the present value, one has to make use of discount rate Partnership in case of general business consists of minimum two persons and maximum 20 persons Individual Demand Schedule Is in tabular form , It shows the prices of goods , It shows the quantities of a commodity purchased Implicit costs are Cost on self owned resources , Costs of salary of the proprietor , Interest on the entrepreneur's own investment Characteristics of the phase of Depression are Decrease in economic activities , The growth rate becomes negative , The level of national income declines rapidly The financing of ________ goods is done through public expenditure. public In a market system of an economy, producers are guided by ________ motive. profit 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 of the goods. Exclusion   Correct Answer   Expansion of credit Quantitative credit control measure J.M. Keynes Wave like movement A Joint Stock Company is managed by the Board of Directors elected by shareholders. True The market system of economy is based on the following foundations:Sovereignty , Non-interference by the state. , Private Consumer's Profit Motive The externalities which cannot be priced in the market with reference to the demand and supply behavior are termed as non - market external effects During a period of rising prices (inflation), the goods and services are scarce Slope of supply curve is positive The minimum number of directors which private limited should have is ________. 2 The externality which causes an economic gain or an economic loss to other economic units is also referred to as ________ externality. Pecuniary The chemical effluents recklessly released by a chemical factory in the river causing water pollution, is an example of ________ cost. social Long period supply is relatively inelastic. False Features of Long –run market are It is durable goods market , Supply can be increased or reduced according to the demand , Sellers at least recover minimum price for their goods In macro – economic analysis the behavior of economic agents such as firms, households and government is seen in total, disregarding details at particular level. True The act of manufacturing goods and services is called production True inflation starts only after reaching the level of full Employment During periods of inflation, the income of farmers as a class decreases. True The externality in which the consumption or production levels of an economic unit affect the other economic units in the economy is called technological externality 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. indivisible The features of business or trade cycle are It is a wave like movement , These fluctuations are recurrent in nature , Expansion and contraction in trade cycle are cumulative in effect   Correct Answer   goods and services J. M. Keynes unlimited Decision making and forward planning scarce Features of monopolistic Competition are Fairly large number of firms , Product differentiation , Selling costs are existed Assumptions underlying the law of Supply are :The cost of production is unchanged , No change in technique of production , Government policies are unchanged Price is the, only determinant of demand False The number of sellers operating under monopolistic competition as compare to oligopoly is larger The salary of the proprietor or rent on own land are the ________. Implicit cost All the man made resources which are used in the process of making other goods and services are called capital Managerial economics aims at providing help in the firms is decision making In a market economy ________ is the best judge of personal interest. individual The prosperity phase is characterized by rise in the level of employment. True Like all organism, the firm too is an organism according to the ________ life-cycle theory. Demand for safety pins is ________ inelastic Inflation is characterized by demand which is in excess of supply A firm is a unit of production, where production is done with the aim to maximize profits The factors of production are Labour , Land , Capital Price discrimination is possible in perfect competition False Economic problem is faced by poor countrys only. False Economic problem does not arise in case of a rich country. False In case of increase in the income, the rich person's demand for goods will be more According to Keynes there are three motives for holding cash for liquidity preference the transactions motive , the precautionary motive , the speculative motive Price of a product under perfect competition is determined by the interaction of total supply and :total demand The demand curve (A.R.) of a firm under perfect competition is perfectly elastic   Correct Answer   quantity demanded equals quantity supplied quantity demanded minus quantity supplied quantity supplied minus quantity demanded. Complimentary goods   Correct Answer   Goods and services Unlimited Decision making and forward planning Scarce Economic problem arises only in case of an overpopulated country. False Economic problem is universal in nature True Scarcity of resources is the root cause of economic problem. True The question regarding the nature and quantities of commodities to be produced is solely restricted to capitalist economies. False The enterprenuer gets Pure Profit for undertaking risk & uncertainity , for co-ordination & organizing production , for innovation According to J.M. Keynes, the equilibrium between the aggregate demand function and the aggregate supply function can, and often does take place at less than full employment In the Long- run, supply of goods can be adjusted to the demand and therefore supply curve is horizontal to the X-axis. False J.M. Keynes presumed an economic model as a short period model in his analysis. True The registration of a partnership firm is voluntary True Demand for a commodity depends on the relative price of its ________ substitute goods A group of firms dealing in the same line of business are called as Industry The products sold by different sellers under pure competition are of exactly the same quality According to the Government, the buildup of inflationary pressure during the Nineties was attributed to Higher Fiscal deficit All the free gifts of nature which are commonly called natural resources are known to economists as Land Quantitative credit control measures are Open market operations , Changes in bank rates , Changes in statutory reserve ratio The firm may be defined as 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 Under perfect competition single seller can influence the price. False Assumptions of group equilibrium under Monopolistic Competition are 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   Correct Answer   Universal Reduction in purchasing power Applied branch of knowledge Theory of price Involuntary unemployment An assembly of several machines, linked together either physically or by processes capable of producing a given quantity of a product per day is plant In the cost – benefit analysis, after formulating various alternative project capacity, each of them has to be examined in terms of its feasibility Joint Stock Company succession is perpetual In the market, any one who agrees to pay the requisite price of a product would be excluded from their consumption False The prosperity phase is characterized by rise in the national output True Inflation is a sustained and appreciable rise in prices True Over the years in India the govt. expenditure is increasing In any business, while formulating a profit policy, the possibility of emergence of rival firms must be taken in to account. True Change in income of a person may bring about in demand for goods. change Demand for luxury goods is inelastic. False Demand for food grains is inelastic but the demand for wheat is elastic. True Administered ________ are normally set on the basis of cost plus a ________ margin of profit prices stipulated Costs which increase because of the expansion of a firm are called costs incremental The law of supply is not hypothetical. False In short run period Supply of goods can be adjusted to the demand to some extent , Some factors can be changed , Supply and demand determine the price Average Product is calculated by dividing Total product by variable Factor Units. True An Industry Is a group of firms , All firms dealing in the same line of business , The ownership and management of each firm is different Under monopoly, there is ________ seller who controls the entire ________ in the market only one supply 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 investments worth Effective Demand 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 Characteristics of Depression Decrease in economic activities , The growth rate becomes negative , The level of national income declines rapidly 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 entrepreneur employment Causes for rise in prices in India Mounting government expenditure , Deficit financing and increase in money supply , Role of black money The firm may be defined as: 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. Exceptions to the Law of Demand are Giffen Goods , Articles of snob Appeal , Speculation Explicit costs are: Out of pocket costs , Expenditure costs , These are firms accounting expenses 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. land and minerals human capacity The ________-taking theory was developed by the ________ . According to him, profit arises because considerable amount of risk is involved in business. American economist Hawley risk 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. price price elasticity Wholesale ________ index numbers measure the ________ in the general price level of a country. Price changes The money payment, which a firm makes to those ________ who supply labour services, raw materials, transport services, electricity etc. are called ________ costs. outsiders explicit In economics the question related to the selection of methods with which commodities are produced is a subject matter of theory of production A Joint- Stock Company is owned by its share holders but it is managed by Board of Directors 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 False The registration of a partnership firm is voluntary. True In case of sole proprietorship the owner and organization are same. True The Joint- sector is a form of partnership between the private sector and the government. True 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 Effective demand In Trade cycles the economic activity are ups and downs Inflation is a phenomena of in which prices rises Market system or market economy suffers from time to time from economic depressions True According J.B.Clark, profit is the reward paid for Dynamism While calculating economic profit, only explicit costs are considered. False Emergence of close substitutes to the commodity in question may bring about demand to decrease 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 inelastic The demand for life saving drugs is elastic. False   Correct Answer   Statistical device E.D. =infinity E.D. = 0 E.D. = 1 Changes in quantity demanded The government of India follows administered price policy in respect of commodities which are vital and produced in the :Public sector 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 technical Marginal Cost (M.C.) is the rate of change of fixed cost. False Long –run market It is durable goods market , Supply can be increased or reduced according to the demand , Sellers at least recover minimum price for their goods Conditions of Price Discrimination are: 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 Under cost plus pricing :The price is set to cover Material, labour cost , Actual costs, standard costs are included , Certain percentage of profit also included Defects of market system Inequalities of Income and wealth , Emergence of monopolies , Failure to provide full employment Features of public sector enterprises It is controlled by the state. , Separate funds to undertake their activity. , They are accountable to public. Demand curve of an individual for a commodity X is based on the following assumptions Elasticity of demand for good X , Price of good X , Income of the consumer Different types of Elasticity of Demand are: Price elasticity of demand , Income elasticity of Demand , Cross Elasticity of Demand Forecasts can be made at the level of A firm , An Industry , The Nation Diseconomies of small -Scale Production includes: 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 Determinants of supply: 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 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 1932 persons Minimum ________ persons have to come together to start a jointstock company. Those who take initiative to start it are called ________ . seven promoters 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 debenture money The joint sector is a form of ________ between the ________ and the government. partnership private sector Other things being equal, the higher ________ of commodity, the smaller is the quantity ________ and lower the price , larger is the quantity demanded. demanded price Features of Pure Competition are Large number of buyers and sellers , Homogeneous products , Free entry and free exit of firms Methods of measurement of elasticity are Percentage method , Point elasticity method , Total outlay expenditure method The short run Average Cost (A.C.) curve is U shaped. True The partnership between private sector & government is called ________ Joint sector enterprise The subject matter of Micro economics includes the study of an individual consumer , particular market for a given commodity , operation of a firm The persons who own the ________hip concern are called Partners. Partners The main objective of a co- operative organization is service With technological advances, with the given inputs, the flow of output increases In the Long run perfect competition and monopolistic competition the firm make profits which are normal Phases of business cycle Expansion , Peak , Recession In case of perfectly elastic supply, the supply curve is horizontal The production function can be explained by Law of variable proportions , Laws of returns to scale , Optimum combinations of inputs A private limited company can be formed with 2 to 50 members maximum, excluding ________ employee shareholders Modern economists treat social cost and benefits as ________ of private investment and production decisions. externalities Production Function implies relationship between input & output The divisible goods, whose benefits can be priced, are called pure public goods. False   Correct Answer   J. M. Keynes Reduction in purchasing power Theory of production Intangible goods All firms producing the homogenous or similar products together make an industry The total output of all the commodities in one country over some period, usually taken as a year is called as Gross National Product , National Product , National Income 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 :Divisible good Scope of Managerial Economics deals with Demand analysis and forecasting , Production function & cost analysis , Inventory management adverting, price system The number of buyers & sellers operating under perfect competition is large Measurement of profit becomes difficult because of the difficulty involved in the calculation of depreciation. True Economic Profit takes in to account the implicit cost The supply curve slopes downwards from left to right. False Reasonable profit target as an alternative to the objective of profit maximization was suggested by ________. Joel Dean Characteristics of the phase of Recession are Investments decline , Negative multiplier gets underway , Inventories pile up Pure private goods are completely divisible and to them the principle of exclusion applies in full measure. True According to Prof. F.H. Knight, profit is a reward for uncertainty bearing Macro economic studies are based on empirical evidence. True Price discrimination is possible in case of public utilities with legal sanction , personnel services sold , geographical barriers During the period of depression, a large part of a country’s resources lie involuntarily idle. True In case of a partnership firm of business organization a minor can become partner of the firm. False The Government attempts to increase supplies of food grains and other essential goods in times of internal shortage through larger imports The out of pocket costs are ________. Explicit costs Economists call all human resources as labor Economists call all human resources mental, physical , inherited and acquired as Labour All the buyers and sellers operating under perfect competition have knowledge which is perfect The meaning of the word “economic” is most closely associated with the word unlimited True The conditions of equilibrium of a firm are applicable to all markets None In case of the co-operative societies supplying cheap inputs or supplying consumer products at fair prices, a system of subsidized pricing is followed True The price of a good and the exclusion princople together is divisibility The liability of a sole proprietary firm is unlimited Institution of private property is not an essential feature of Capitalism False There never was in any country at any time ‘pure capitalism’ or ‘pure communism True A Joint stock company has perpetual succession. True The management of the cooperative form of business organization is totalitarian in nature. False In macro – economic analysis the behavior of economic agents such as firms, households and government is seen in total, disregarding details at particular level True New commodities due to technotogical progress may result in demand for traditional type of goods decrease   Correct Answer   Infinity. Infinity Upwards to the right Vertical straight line Downwards to right External economies are the advantages of large scale production enjoyed exclusively an individual firm alone. False Equilibrium is The stage of maximum satisfaction , The stage of balance , The stage of stationary The conditions of equilibrium for a firm are :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 Aggregate supply function 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 Recession includes The demand is halted , Increase in production of goods , Inventories piling up in stocks 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 Keynesian aggregate The rate of interest, according to ________ , depends upon two factors: (i) ________ and (ii) the quantity of money Keynes the liquidity preference function Reasons for need of public distribution system To maintain stable price conditions , An efficient management of the supply , To supply the necessary goods to people at reasonable price The consumer protection Act includes Protection from hazardous commodities , Right to a competitive price , Right to information regarding protection Assumptions of the Law of Demand are :No change in consumer’s income , No change in consumer’s preferences , No change in fashion Types of income elasticity of demand Negative income elasticity , Zero income elasticity , Unit income elasticity Managerial ________s generally refers to the integration of economic theory with ________ practice. economic business The problem of unlimited wants and limited ________ with ________ uses has been forever confronting mankind. means alternative 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 Co-operation voluntary Like all organism, the ________ , too is an organism, according to the ________ theory. firm life-cycle theory Indices constructed for one ________ should not be ________ for other purposes where they not be fully appropriate and given erroneous conclusions. purpose used   Correct Answer   Maximum sale proceeds expected by entrepreneurs J. M. Keynes Short – Period Analysis Quantitative credit Control Measure Wave – like movement In cost - benefit analysis, after the step of appraisal and selection of the project is the step of comparison of the cash flow Social costs cannot be included in a firm's account book. True Steps in cost benefit analysis are :Identification of a project , Formulation of the project , Appraisal and selection of the project The advantage of cost-benefit analysis are Maximization of social welfare , Objective measurement of the trade-off , Maximization of difference between total benefits & total costs Cost-Benefit analysis aims at ________ of social wealth. maximization According to many economists, the root cause of economic problem is scarcity Managerial economics aims at providing guidance to the firms for decision making In case of a Joint-Stock Company, the liability of share holders is limited For an economist, Tata Eng & Locomotive Company Ltd is a firm Preference Shares can be classified as Simple Shares , Cumulative Shares , Redeemable Shares The promoters of a company can get incorporated by filing with the registrarof companies various documents such as Memorandum of Association , Articles of Association , Prospectus Baumol has suggested as an alternative objective for profit maximization , the maximization of ________ sales The minimum number of directors which public limited should have is ________. 3 The profit which is surplus of revenue over and above all paid out cost is Accounting Profit In economics, demand means desire backed by adequate purchasing power When more units of a commodity are purchased in response to decline in price of that commodity, it is called as expansion of demand Demand for products like tea, betel, tobacoo, sigaratte is a matter of habit If the substitutes are relatively cheaper then the demand for the commodity in question will be less A shift in the demand curve to the left shows increase in demand. False Cost function denotes The prices of such inputs as labour and capital material , The rate of output , The size of the plant The law of constant returns to scale is depicted by the marginal output curve which is ________. horizontal In the 3rd stage of operation of the law of variable proportions, the marginal product becomes ________. negative The costs which cover the cost of advertising is ________. Selling cost Features of Oligopoly Market are :Few sellers , Restriction to entry of new firms , Price leadership Saving is a private virtue To solve the unemployment problem , the level of effective demand must decrease. False Market system or market economy suffers from time to time from economic depressions. True In economics the questions related to the division of society’s output of goods and services among its members are topics in theory of distribution In economics the questions related to the dynamic or static ( otherwise) capacity of the economy to produce goods and services are topics in the theory of economic growth An industry is a group of firms dealing in the same line of business Pure public goods must be in the hands of public sector only. True The characteristics of a sole proprietorship firm is Unlimited Capital , Ownership by a single person , Easy to form Different types of business organizations are private sector , public sector , joint sector The form of organization which is best for self employment is ________. Sole trader In any business, while formulating a profit policy, the possibility of emergence of rival firms must be taken in to account True The payments made out of the Gross Profit are Remuneration to factors of production , Depreciation , Maintenance Charges reasonable profit' are Capital Attraction , Plough Back , Normal earnings The demand for a commodity depends on the prices of its substitutes which are :Relative Demand curve slopes downwards from left to right. True If the increase in all factors leads to a less than proportionate increase in output, then the returns to scale are decreasing The supply of factory made goods of daily consumption is inelastic. False Output rises in a lesser proportion to that of the increase in input, under the case of ________. decreasing returns to scale If the output rises in the greater proportion than that of the increase in factor inputs, it is referred to as ________. increasing returns to scale. Under monopoly the demand curve slopes downward Dalal Street in Bombay is known as Bombay Stock Exchange The city of Banaras has specialized in the manufacture of :Silk A firm under perfect competition is a price maker. False Features of the firm are :It is a business unit organized under one ownership , It is a sole proprietorship , It is a partnership or joint stock company Equilibrium is the stage of maximum satisfaction , balance , stationary The Keynesian theory emphasizes effective supply as a crucial factor in determining the level of income and employment. False The government also fixes minimum procurement prices for major crops on the recommendation of the Agricultural Prices Commission (APC). True Government intervention is needed in free market mechanism to 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 Cost-Benefit Analysis is The analysis undertaken to judge the investment of any project , Refers to finding out the worth of investment , Enable ranking of optional investments Characteristics of Pure Public goods are: They are completely indivisible , Their marginal cost would be zero or close to zero , Their benefits cannot be priced In the context of formulation of an investment project, ________ feasibility means the availability of land, plant, machinery, raw materials and technical know how etc. technical Prof. Sam Nelson calls risks from unsafe factories or nuclear power plants as ________ economies. negative The suggestion of reasonable profit target as an alternative to the objective of profit maximization is by Joel Dean Public corporations are managed by the board of directors appointed by Government In case of a Joint Stock Company the liability of the share holders is unlimited. False There is no separation of ownership and management in case of a Joint Stock Company False Types of Share capital of Joint-Stock Company are registered or authorized capital , issued capital , paid-up capital Peas & beas, groundnut oil & til oil, tea & coffee are examples of substitutes goods The sum of all individual demands constitutes________ market demand Increase in consumer’s income leads in the demand for inferior goods to ________ decrease The cost which enter the accounts book of the firm are referred as ________. Accounting cost By ' profits', the economist means total revenue minus ________. All costs The supply curve during market period is perfectly inelastic A monopolist in a price maker. True If demand falls and supply is constant the equilibrium price falls. True The General Theory of Employment, Interest and Money in 1936 was published by J.M. Keynes During recession, on account of decline in investment by producers, there is decline in income and consumption. True According to Keynes, Effective Demand :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 Features of stage of expansion in business cycle are Rise in national output , Rise in consumer and capital expenditure , Bank advances grow rapidly According to J.M.Keynes, the equilibrium is established at the level less than full employment Under the New Industrial Policy, Public enterprises which are chronically sick and which are unlikely to be turned were referred to BIFR True Public enterprises have shown a very high rate of return of the capital invested False Supply management is related to the volume ofsupply & its distribution system. True The fiscal policy includes Formation of taxation policy , It is an instrument for economic stabilization , Monitoring of public expenditure The meaning of monetary policy is :It is programmed of the central bank , It controls the total supply of money , The basic objective is to achieve economic stability The disinvestments of industries is needed for Phased privatization , Reducing deficit , Capital support to plans Important theories of profits are Risk taking theory , Uncertainty-bearing theory of profit , Dynamic theory of profit Important theories of profits are Uncertainty-bearing theory of profit , Dynamic theory of profit , Life cycle theory In a market system of an economy procedures are guided by profit motive. True By using cost-benefit analysis we can show the measures necessary for attaining maximum ________ and optimal policy aiming at this goal. net wealth ________ effects are those externalities which flow from the production or use of the good to other parties or economic units. Third party Micro-economics is primarily concerned with the problem of what, how and for whom to produce? False Every nation, poor or rich small or great has to face basic economic problem that is 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? A plant is an economic unit which takes various decisions related to production and distribution. False Economist's concept of profit is Pure Profit , Economic Profit , Just Profit Giffen goods are superior goods. False An upward sloping demand curve is called ________ exceptional demand curve Demand is determined by Price of the product , Relative prices of other goods , Tastes and habits Demand Curve Is a graphical presentation , Slopes downward , Explain the relation between price and demand When input and output increase in the same proportion, the phase of returns are constant In case of decrease in supply, the supply curve shifts to left side of the original supply curve. True A supply schedule is a graphical presentation of supply patterns. False Increasing Returns explains Total product increases at an increasing rate , Marginal product increasing and it is maximum , Average product is increasing but it is below MP A place where buyers & sellers meet each other to effect a business transaction is known as Market Variable cost are those costs which vary with the level of output   Correct Answer   kinky emphasizes the market conditions helps the firm to become more aggressive in the market perfectly elastic Average Revenue curve Marginal cost pricing explains that the 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 The crucial factor in determining the level of income and employment, according to Keynes is effective demand   Correct Answer   namely i) the M.E.C. and ii) the rate of interest. a cause of inflation from supply side. A.D. = A.S. Recession Often monopolies purposely keep certain factors of production idle creating artificial scarcities of their products as a result the prices rise Reasons for need of public distribution system are To maintain stable price conditions , To bring an efficient management of the supply , To supply the necessary goods to people at reasonable price In case of a pure public good, its marginal cost is zero The financing of the pure public goods has to be through public expenditure and not through market pricing. True In the context of formulating an investment project, ________ feasibility means the availability of supervisors for implementing and running the project smoothly and professionally. management In contrast to the normative concept of justice, efficiency and inefficiency are positive concepts. True The suggestion of maximization of balanced growth rate as another alternative objective of a firm's profit is suggested by Prof. Morris   Correct Answer   Hindustan Machine Tools Cyert R.M. and J.G. March Public welfare Prof. Kenneth Boulding Gross Profit includes remuneration for the factors of production paid by the entrepreneur , depreciation and maintenance charges , net profit When with a rise in price, the total outlay falls, or with a fall in price, the total outlay rises, elasticity of demand is >1 When demand for the product increases in the same proportion in which income increases, Income elasticity of demand will be equal to________ unity In the traditional concept of equilibrium, a firm attains the equilibrium when the firm’s Total Revenue (T.R.) =Total Cost (T.C.). False The Laws of Returns to scale are Law of Increasing Returns to Scale , Law of Constant Returns to Scale , Law of Decreasing Returns to scale Under the decreasing returns to scale, the marginal output curve slopes ________. downward Under monopoly entry of new firms is prohibited The economists who defined the term 'market' different from that of the traditional sense is :Jevons & Cournot Under , Perfect competition, when an individual buyer increases or reduces his demand , the total market demand is not all affected When a firm’s average revenue (A.R) is less than its average cost, it earns only normal profit. False Types of imperfect competition are Monopoly , Duopoly , Oligopoly The principle of full employment equilibrium was stated by Say's Law of Market During the period of recession there is increase in incomes of wage and interest earners. False The feasibility, which includes the prospects of employment generation, development of backward areas, social groups comprises of Economic feasibility As far as its use is concerned, tuning in of a radio can be categorized as: Divisible In a market system of economy, there is no harmony between individual interests and interests of the community. False Institution of private property is not an essential feature of Capitalism. False In case of defense services, all the sections of the society are equally protected and benefited. The defense services in other words is in character , cannot be priced in the market , a public indivisible good On the ________ level, the summation of maximum individual welfare does not automatically lead to maximum social welfare. macro Inflation reduces the purchasing power of people's income and savings. True In a free-enterprise economy, the problems of what how and for whom are solved by a planning committee False A technical unit of given capacity of output is plant The sole proprietorship type of organization is found in Agriculture, , Retail trade, , Hotel, Co-operative organizations is voluntary organization , managed by democratic principle , organization, which performs its business within the members 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 LIFO Profit should be large enough for a plough – back for business expansion. True Profit is regarded as income accruing to the equity holders , wages accrue to the labour , rent accrue to the owner Change in income of a person may result in demand for goods to change 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 A.R Perishable goods A.R.> A.C. Under monopoly the demand curve slopes Downward. The wage and salary earners who get fixed income in terms of money are benefited during inflation. False 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. Unfair, consumer’s health. Gross profit is the excess of total revenue of a firm over total Expenditure. 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 is High. In the cost - benefit analysis, the first step involved is that the investor has to choose a few project alternatives promising a high rate of return The basic economic problems that are faced by various types of Economies. 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? Long – run market It is durable goods market, Supply can be increased or reduced according to the demand, Sellers at least recover minimum price for their goods. Features of monopolistic Competition Fairly Large numbers of firms, Product differentiation, Selling costs are existed. Features of public sector enterprises It is controlled by the state, Separate funds to undertake their activity, They are accountable to public. Joint-Stock company is A voluntary organization, Managed by Elected Board of Directors, A common seal. The sources of economic problems are: Man has unlimited wants or ends, The means or resources to satisfy them are limited; These resources are not specific but have alternative uses. Defects of market system Inequalities of Income and wealth, Emergence of monopolies, Failure to provide full employment. Goods produced on small scale of supply is Inelastic Economist’s concept of profit i.e. pure profit is a return over and above cost is Implicit   Correct Answer   The act of using goods and services to satisfy wants. Anyone who consumes goods and services to satisfy his or her wants. Anyone who helps to produce goods or services The goods and services that are produced by factors of production. The act of making goods and services. In the contraction of price index number, selection of the base year needs to be done with utmost care. True The law of variable proportion means the same thing as the laws of returns to scale. False J.M. Keynes presumed an economic model as a short period model in his analysis True Other things being equal, the higher ________ of commodity, the smaller is the quantity ________ and lower the price, larger is the quantity demanded. Demand, Price. Every nation's ________ are insufficient to produce the quantities of ________ than would be required to satisfy all of its citizens' wants. Resources, Goods & Services. 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. Profit, Accountants. There are two factors determining the __________ functions, namely (i) __________ and (ii) the rate of interest Marginal efficiency of capital, The investment. Minimum ________ persons have to come together to start a jointstock company. Those who take initiative to start it are called ________. Seven, Promoters. 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. Decision, Statistics. 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 all of them. Co-operation, Voluntary. Supply management is related to the volume of supply & its distribution system. True To solve the unemployment problem, the level of effective demand must decrease. False Inflation is a great opportunity for merchants to earn more profit. True Under the disinvestment process, there is full transfer of ownership. True 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. False Economists like A.C. Harberger have shown that the cost benefit analysis can be applied to ________ analysis. General equilibrium Goods which are paradoxical to the law of demand are ________ Giffen goods. The necessary condition of profit maximization of a firm is that Marginal Revenue (M.R) must be equal to ________. Marginal cost (M.C) The consumer protection Act includes Protection from hazardous commodities, Right to a competitive price, Right to information regarding protection Demand forecasts are necessary for Fulfillment of objective of the plans, Preparation of a budget, Expansion of firms Consumption function refers to income consumption relationship, representation as c=f(y), functional relationship between two aggregates Preference Shares can be classified as Simple Shares, Cumulative Shares, Redeemable Shares The important determinants of supply are Always referred to in relation to price & time, Govt policy, Availability of factors of prod. Marginal Propensity to consume is characterized as follows :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 Methods of forecasting demand for new products are Product life cycle analysis, Test marketing, Evolutionary approach There is separation of ownership and management in a Joint Stock Company A firm gets an opportunity to produce multiple products because changes in business activity in a firms is cyclical The study of the supply side of product pricing is done under the Theory of Production Question related to the efficient production and allocation belong to the branch of economic theory called Welfare Economics   Correct Answer   Maximization of net wealth Government Economic evils Free enterprise system   Correct Answer   Abnormal profit. Tends to be rigid at the kink on the demand curve. To enable it to operate at the lowest cost possible and maximize efficiency. Expenditure is incurred by the firms on cross transportation.   Correct Answer   The maximum amount which can be raised by a company by selling shares. Which is issued for subscription by dividing into shares. Which the public directly pay – up to the company, as part payment of the share the issued capital which is actually subscribed by the That part of public. 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. True Marshall has classified the period of time into three heads Short run, Long run, Market period Various kinds of economic policies are Industrial licensing policy, Commercial policy, Fiscal policy Economist's concept of profit is Pure Profit, Economic Profit, Just Profit The production function can be studied in three ways or explained by Law of variable proportion, Laws of return to scale, Optimum combination of inputs The Laws of Returns to scale are Law of Increasing Returns to Scale, Law of Constant Returns to Scale, Law of Decreasing Returns to scale The main criterion of indivisibility of a good is that the good 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. Different types of Elasticity of Demand are Price elasticity of demand, Income elasticity of demand, Cross elasticity of demand The form of market in which there is monopoly of two firms is known as Duopoly Incorporation of government company is Compulsory The Keynesian Theory is Demand oriented Under the imperfect market, the market in which few firms exists is called as Oligopoly   Correct Answer   Indivisible Spill over effect Maximization of output Step of cost benefit analysis A responsible factor for inflation is hike in prices The city of Ludiana has developed a big market for hosiery Features of Dumping are 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 J.M. Keynes stated that effective demand is determined by the interaction of the aggregate supply function and aggregate demand function Baumol has pointed out three main contributions of economic theory. They are offers clarity to various concepts used in the Economic theory 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 The subject matter of managerial economics covers two important areas namely decision-making and forward Planning   Correct Answer   Snob Appeal Statistical device E.D. = 0 Changes in quantity demanded The cost recorded in the books of accounts are considered as :explicit costs Under competitive conditions, market mechanism would automatically bring equilibrium at the level of full employment Inflation reduces the purchasing power of money and savings. True The supply curve during market period is perfectly inelastic The price policy under monopolistic competition is dependent on the prices charged by other rival firms True Private profit motive is an essential feature of Capitalism True ‘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 True Inflation is a great opportunity for merchants to benefit more. True The various phases of business cycles are shown by the line of cycle which moves up and down the steady growth line True In the measurement of profit, the differences in the concept of profit arise out of the differences in cost concepts True Under the monetary measures to control inflation, the R. B. I relies heavily on selective credit controls on bank loans against food grains, sugar, oils, oilseeds, cotton etc so as to discourage Speculative hoarding The opportunity cost of a product is the opportunity gained of being able to produce some other product. False The supply curve in case of unitary elastic supply is rectangular hyperbola. False Under monopsony, there are ________ sellers but ________ buyer many only one   Correct Answer   Zero Demand curve of a commodity Addition to total utility Posative and declining Marginal utility is zero By using cost-benefit analysis we can show the ________ necessary for attaining maximum ________ and optimal policy aiming at this goal measures net wealth Average propensity to consume It is defined as 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 Inflation means It is a phenomenon of rising prices , It is a general and dynamic phenomenon , It includes an excess of demand 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 schedule revenues The meaning of monetary policy It is programme of the central bank , It controls the total supply of money , The basic objective is to achieve economic stability Managerial economics deals with Integration of economic theory with business practice , Using logic of economics, mathematics & statistics. , The use of economic modes of thought to analyze business solution. The sources of economic problems are: Man has unlimited wants or ends , The means or resources to satisfy them are limited. , These resources are not specific but have alternative uses. Different types of business organizations are; Private sector. , Public sector. , Joint sector. Proprietary firm is Owned by a single person. , Easy to form. , An organization of single person. 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 decision making statistics Individual or sole ________ , which is also called sole- ________ , or single entrepreneurship is the most common, the simplest and the oldest form of business organisation. proprietorship trader ship Nominal cost is the ________ cost of production, it is also called expenses of production. The real cost is the ________ cost of production. money opportunity The costs of self owned resources, which are employed by the ________ , are non- expenditure or , ________ firm implicit costs . In equilibrium analysis of a firm, it is assumed that every individual proprietor exhibits rational economic behavior   Correct Answer   The theory of distribution Prescriptive in nature Tangible goods Alternative uses Insatiable The firm is the unit that makes the decisions regarding employment of and the output of commodities are factors of production During the phase of depression, the level of national income and expenditure rises rapidly False   Correct Answer   Quantity supplied minus quantity demanded A rise in equilibrium quantity The supply is perfectly elastic Elasticity of demand In the same proportion Greater scope for the ________ sector may mean incremental ________ , which connotes the expansion of public sector undertakings, can be left to some private companies private disinvestments In the stage I of the law of diminishing returns, the marginal product goes on increasing True Where ________ is charging a ________ in the home market and a lower price in the international market, it is called Dumping monopolist higher price The number of sellers operating under this type of competition is ________ under oligopoly, but less than under ________ larger than perfect ompetition Marginal Propensity to consume 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 Investment It adds to capital equipments , It leads to increase in level of income , It includes new plant and equipment In the words of ________ , “inflation occurs when the ________ of prices and cost is rising”. Prof. Samuelson general level Specific organizational goals of Firms are: Maximisation of profit , Reasonable Profit Target , Sales revenue Maximization 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. a single no effect 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 Profit accountants The demand curve is ________ representation of a demand schedule, demand curve slopes ________ ward from left to right. graphical down The ________ that is ________ is the opportunity cost of the commodity produced. commodity sacrificed Prof Samuelson calls the air and water pollution or dangers from drunken drivers as economies that are negative In Capitalism, the sovereign consumers express their preferences through :price mechanism Expansion of supply is shown by the movement in the supply curve which is upward During the period of depression, demand for bank credit reaches its low level and banks experience mounting of their cash balances. True The subject matter of macro – economics includes the theory of income and employment at an individual level. False The private sector is owned by ________. private individuals During the phase of depression, the level of national income and expenditure rises rapidly. False   Correct Answer   monopolistic competition which private enterprise may not bear at all. yet they may constitute a market over telephone or through internet cost of transportation does not exist The production function studies :Input and out put relation , Factors of production and final production , Technology used in production The economic stabilization means Preventing excessive economic fluctuations , Efficient utilization of labor and other factors of production , Encouraging free competitive enterprise The effective solution to the problem of internationalizing of externality involves , Private action providing correctives , Government action Externality taxes Objectives of economic policy are 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 The production function can be studied in three ways Law of variable proportion , Laws to return to scale , Optimum combination of inputs Keynes’s theory of employment explains Effective demand , Aggregate supply , Aggregate demand While calculating accounting profit, the costs which are considered are by nature explicit Poverty is the root cause of Economic problem. False In economics, the problem related to the selection of methods for producing different commodities is a subject matter of the Theory of production Under perfect competition, price is determined by the interaction of total demand and total supply in the market. False The slope of Supply curve of labour is always backward Features of market period are Related to few hours or few days , Related to perishable goods , The entire supply is to be disposed off on the same day Cournot' , the economists who defined the term 'market' different from that of the traditional sense is an French economists The act of production involves transformation of inputs into outputs While Disinvestments process, Government retains 50% of the equity with itself & transfers 49% to private sectors False Total Revenue - (explicit costs + implicit costs), this equation is used for calculating Pure Profit A fall in quantity demanded without a fall in price shows decrease in demand. True In case of a proprietary firm the liability of the proprietor is limited. False Diseconomies of small scale production includes High average cost of production in initial stages , Workers in the factory take some time to adjust with new techniques of production , Wastage of raw material & power It is easy to estimate the amount of black money False Bargaining is one of the remedies of corrective action. False Internal Economies involves Advantages of large-scale production , Low cost of production , It avails benefits of cheaper finance The public sector is owned & controlled by state enterprises The city of Kashmir has specialized in the manufacture of shawls Market mechanism is characterized by instability In case of defense services, all the sections of the society are equally protected and benefited. The defense services in other words is good , indivisible in character , cannot be priced in the a public market The term externalities may also be referred as: Spill-over effects , Neighborhood effects , Third party effects The examples of negative externalities are nuclear power plants , gargantuan trucks , unsafe factories According to Keynes, Aggregate supply function refers to 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 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. True Goods which are completely divisible and to them the principle of exclusion applies in full measure, are called Pure public goods A monopolist can decide both price and the quantity of a product that he is going produce and sell in the market. True The market which deals with the all the goods as a whole are considered as Commodity Market The city of Surat has specialized in diamond polishing Consumer’s protection involves protection to the consumers from unfair trade practices. True Car & petrol, tea & sugar, shoes & socks, sarees & blouse are examples of complimentary goods The products sold by different sellers under pure competition are heterogeneous. False   Correct Answer   Explicit costs Pure profit Uncertainity Hawley Which statement is true about Pure Private goods Principle of Exclusion applies to them There never was in any country at any time 'pure capitalism' or 'pure communism.' True 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 ________. shadow prices Factors influencing selling costs are Type of product , Introduction of new goods , Technology changes Pure inflation starts only after reaching the full employment level. True The demand curve has a negative slope. True The rise in prices is basically because of shortages of basic goods & services and a rapid growth of money supply. True The railways use a lot of coal in firing the steam locomotives. This act causes a lot of sufferings to the people near the railway. , cost to the society. , no cost to the railways. The study of , what commodities are being produced and in what quantites I.e the study of allocation of resources is discussed under the Theory of price Saving is a private virtue True The externalities that may be an economic gain or economic losses to other economic units are referred to as technological externalities. False Liability of a sole trader is unlimited the concept ,of Perfect competition includes all the features of Pure competition In case of a proprietory firm, the liability for all his debts is unlimited J.M. Keynes, on the basis of a fundamental psychological law of consumption, observed that as income increases, consumption also increases, but proportionately :less   Correct Answer   Market economy Market economy Social cost Economies of scale One of the serious limitations of market mechanism is that it results in distribution of income and wealth which is unequal Macro economics is the study of the aggregate behavior of economy The Risk Taking Theory was developed by Hawley, who was an American Economist If the substitutes are relatively costly then the demand for the commodity in question will be more Effective Demand covers Consumption outlay for the households , Investment outlay in the private sector , Government’s spending for consumption as well as investment Under perfect competition there are large number of buyers and few sellers. False The profits which must be deducted from the gross profits to arrive at net profits are :Monopoly Profits The city of Kanpur has developed a big market for leather goods Various binds of economic policies are Industrial liscencing policy , Commercial policy , Fiscal policy The partners are joint owners of the property a partnership firm. True " The General Theory of Employment, Interest and Money" by Prof.J. M. Keynes was published in 1936 According to Lionel Robbins definition of economics, "Economics is a science which studies human behaviour , relationship between ends and scarse resources , scarce means have alternate uses Demand is related to price, time and place. True The city of Coimbatore has developed a big market for spinning The firm is a center, where all the decisions are taken about production   Correct Answer   tends to be rigid at the kink on the demand curve from buyer’s side are allowed under the law to make price discrimination to enable it to operate at the lowest cost possible and maximise efficiency expenditure is incurred by the firms on cross transportation During the period of depression various factors of production are exhausted Consumption function refers to income consumption relationship , representation as c=f(y) , functional relationship between two aggregates When a want can be satisfied by alternative similar other goods, they are called as substitute goods   Correct Answer   Prof. Edward Chamberlin Price discrimination U shaped Monopolistic competition Under perfect competition, generally demand and supply act and react upon each other and determine the price which is in equilibrium The concept of economic profit differs from that of normal profit. False In case of a partnership firm, the liability of a partner is limited False Generally, the larger the income of a consumer, his demand for overall commodities tends to be relatively elastic. False Profit is regarded as income accruing to the equity holders , wages accrue to the labour , rent accrue to the owner   Correct Answer   Demand and supply Non perishable goods Perishable goods Automatic price mechanism Types of income elasticity of demand Negative income elasticity , Zero income elasticity , Unit income elasticity Implicit costs are Cost on self owned resources , Costs of salary of the proprietor , Interest on the entrepreneur's own investment According to Lionel Robbins, "Economics is a science which studies human behavior   Correct Answer   an increase in supply. zero elasticity of supply. upward from right to left. perfectly inelastic.   Correct Answer   Homogenous Product One Firm Technical Unit Life Insurance Corporation Features of short run period are Supply of goods can be adjusted to the demand to some extent , Supply and demand determine the price , Some factors can be changed Suggestion of maximization of sales revenue as an alternative objective to profit maximization is given by Baumol The method of calculating depreciation in which the actual working hours of a capital asset are taken in to account is service unit A firm is a technical unit of a given capacity of output. False Under perfect competition, if demand increases, supply being constant, the price would rise   Correct Answer   Deficit financing Essential commodities General and selective credit control measures Administered prices   Correct Answer   the modern economists define effective demand as C + I + G + (XM). short run philosophy of life. a general view of the economic system as a whole. Liquidity preference The pioneering analysis of imperfect competition was done by Mrs. Jaon Robinson from the :Cambridge University Normally, a larger quantity is demanded at lower price Public enterprises have shown a very high rate of return of the capital invested. False When a firm’s average revenue (A.R.) is equal to its average cost (A.C.), it gets ________. Normal profit Sole Proprietorship which is also called sole ________ Tradership Under monopoly, the entire supply is controlled by ________. One sellers The important feature of monopolistic competition is ________. Product differentiation Under perfect competition, price is determined by the interaction of total demand and ________. Total supply The market price is determined by the interaction of the market demand curve and ________. Supply curve In market, period supply is elastic. False Main aims of the New Industrial Policy (1991) are :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 act Distinction between private sector and public sector is determined on the basis of :Economic system , Motive , Principle of pricing When people expect a rise in prices, businessmen ________ their investment & this leads in the demand for capital goods to Increase. Increase Problems regarding economy’s capacity to produce goods and services growing from year to year or is it remaining static are the topics in the Theory of ________. Economic growth When in order to satisfy a given want, 2 or more goods are needed in combination, these goods are called :Complimentary goods Goods produced on small scale have :Relatively inelastic supply Under pure competition, the entry & exit of firms is free The damage being done by the factories at and around Agra to Taj Mahal is an example of social cost for private benefit. True An individual consumer or particular market for a given commodity are the subject matter of Micro Economics   Correct Answer   Negative economies Quasi - public goods Divisible goods Market economy Capitalism emphasis more on turnover rather than creating profits False The firm is an economic unit that makes the decisions regarding employment of factors of production The city of Faridabad has specialized in the manufacture of bangles In case of indivisible goods, which are not priced, the decisions regarding their demand preferences are taken through price mechanism. False Specific organizational goals of Firms are maximization of profit , reasonable profit target , sales revenue maximization   Correct Answer   public sector undertaking. advertisement. high price on account of prestige considerations. state government. The supply of agricultural goods is ________. Inelastic As per the New Industrial Policy of 1991, the government had decided to provide approval for direct foreign investment up to 41% of foreign equity in order to invite foreign investment in high priority industries requiring large investment and advanced technology. False When there is ________ in foreign demand for the goods manufactured in a country, exports increase and prices of commodities in the country Increase. Increase The Dual prices system was adopted by the Government in case of ________. Essential goods During Nineties & Eighties, the CRR was raised from 6% to statutory maximum of ________. 0.15 Accounting profit takes into account opportunity cost. False   Correct Answer   The slope of the TVC curve or slope of the TC curve. The cost of producing one unit. Has to touch the long run cost curve. Has the shape of an inverted U. Under Perfect competition, when an individual buyer increases or reduces his demand, the total market demand :Is not at all affected When supply increases, demand remaining the same, the equilibrium price ________. Falls Advertising forms an integral part of decision-making and________. Forward - planning The cost-benefit analysis is useful to achieve the following :Maximization of social welfare , Objective measurement of the trade-off , Maximization of difference between total benefits & total costs Statutory Reserve ratios are quantitative credit control measures undertaken by ________. The State Bank of India "The purpose of Managerial economics is to show how economic analysis can be used in formulating business policies". This definition is given by :Prof. Joel Dean In Disinvestment process, Government retains 50% of the equity with itself & transfers 49% to private sectors. False Oligopoly is a type of ________. Imperfect market The use of a good by one more member of the society does not reduce its availability to others. This applies in case of Pure public good Economists like A.C.Harberger have shown that the cost benefit analysis can be applied to ________ analysis. general equilibrium Firm is an economic unit Pure public goods are subject to the law of decreasing average cost, because of the economies of scale The features of a Joint Stock-Company are perpetual succession , limited liability , free transferability of shares Average propensity to consume is characterized as follows 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 During inflation, the pensioners whose income is permanently fixed, are substantially benefited. False During period of depression various factors of production lie unutilized. True Joint Stock Company is an incorporated association with a perpetual succession The market which covers capital market & all banking and nonbanking institutions are together taken as Financial Market The indivisible goods to which the principle exclusion does not apply are called ________ goods. pure public Features of Perfect Competition Large number of buyers and sellers , Homogeneous products , Free Entry and Free exit of firms When is price discrimination possible In Monopoly Market , In case of Services sold , In case of geographical barriers Public enterprises may incur some social costs which private enterprise may not bear. True Consumers protection involves protection from ________ trade practices for the purpose of promoting sales and making money at the cost of the ________ and well being unfair consumers health Price effect is the result of in reality substitution True Q = f ( N, L, K, T ) , this algebraic expression is used for Production Function TR - (W+R+I+M), this equation is used for calculating Accounting Profit In the law of variable proportion, a stage is reached when marginal product is zero Services need support functions to assist its operation, they are transport, telecom, power What is to be done to all functions of insurance such as marketing, finance etc so that the balance is achieved in insurance? co-ordinating Disclosures should provide ________ and relevant data to shareholders. transparent The factors coming under philosophy of scientific management are: Co-operation , Maximum output , Harmony ________ is one of the major barriers to entry. Government policy Just like planning, controlling process can achieve the objective and goals, if it is Continuous Economists have pointed out that the real world is full of Imperfect competition Under the disinvestments process, there is full transfer of ownership True 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 Debentures The observation of economic histories of the United States & West European countries shows that competition , the heart of market mechanism gives rise to monopolies Demand curve slopes upwards from left to right. False The relation between variable input and ouput is direct A downward movement from one point to another point on the same demand curve implies expansion The three more items which the Government of India had decided to dereserve from the list of 18 industries in April 1993 were motor cars, white goods and raw hides and skins and patented leather. TRUE As far as its use is concerned, the defence service can be categorized as: Indivisible Every seller and a buyer under pure competition is Price taker Under the New Industrial Policy, inorder to invite foreign investment in high priority industries, it was decided to provide approval for direct foreign investment upto 51 %equity in such industries TRUE 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 national market In a proprietory firm the business is owned, managed and controlled by Proprietor Preference share holders get a rate of dividend which is fixed In economics, supply is considered to be a relative term Micro-economic theory studies how a free enterprise economy determines the price of economic resources False Break-Even analysis is derived by Fixed cost , Average variable cost , Quantity of goods and price Managerial Economics List of Attempted Questions and Answers 1 2 3  Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank   Question     Correct Answer    Select The Blank 4 5 6 7 8 9   Question     Correct Answer    Select 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Explicit costs A fall in price tends the demand for goods to ________ expand Defence service is an example of ________ good. indivisible The social costs and benefits are the external economies and diseconomies resulting from the ________ activities, which are known as, "externalities" firm's A normal demand curve has ________+B299 negative slope Cost-benefit analysis refers to the analysis undertaken to judge any projects ________ whether government or private and find out its worth. investments Supply is predominantly determined by ________. Stock The index numbers which measure the changes in the general price level of a country refers to ________ Wholesale prices index “Homeostatic Approach” as an alternative objective of firms was suggested by _________. Prof. Kenneth Boulding The financing of ________ goods is done through public expenditure. public In a market system of an economy, producers are guided by ________ motive. profit 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 of the goods. Exclusion The minimum number of directors which private limited should have is ________. 2 The externality which causes an economic gain or an economic loss to other economic units is also referred to as ________ externality. Pecuniary The chemical effluents recklessly released by a chemical factory in the river causing water pollution, is an example of ________ cost. social 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. indivisible The salary of the proprietor or rent on own land are the ________. Implicit cost In a market economy ________ is the best judge of personal interest. individual Like all organism, the firm too is an organism according to the ________ life-cycle theory. Demand for safety pins is ________ inelastic Demand for a commodity depends on the relative price of its ________ substitute goods The partnership between private sector & government is called ________ Joint sector enterprise The persons who own the ________hip concern are called Partners. Partners A private limited company can be formed with 2 to 50 members maximum, excluding ________ employee shareholders Modern economists treat social cost and benefits as ________ of private investment and production decisions. externalities Reasonable profit target as an alternative to the objective of profit maximization was suggested by ________. Joel Dean The out of pocket costs are ________. Explicit costs Cost-Benefit analysis aims at ________ of social wealth. maximization Baumol has suggested as an alternative objective for profit maximization , the maximization of ________ sales The minimum number of directors which public limited should have is ________. 3 The law of constant returns to scale is depicted by the marginal output curve which is ________. horizontal In the 3rd stage of operation of the law of variable proportions, the marginal product becomes ________. negative The costs which cover the cost of advertising is ________. Selling cost The form of organization which is best for self employment is ________. Sole trader Output rises in a lesser proportion to that of the increase in input, under the case of ________. decreasing returns to scale If the output rises in the greater proportion than that of the increase in factor inputs, it is referred to as ________. increasing returns to scale. In the context of formulation of an investment project, ________ feasibility means the availability of land, plant, machinery, raw materials and technical know how etc. technical Prof. Sam Nelson calls risks from unsafe factories or nuclear power plants as ________ economies. negative The sum of all individual demands constitutes________ market demand Increase in consumer’s income leads in the demand for inferior goods to ________ decrease The cost which enter the accounts book of the firm are referred as ________. Accounting cost By ' profits', the economist means total revenue minus ________. All costs By using cost-benefit analysis we can show the measures necessary for attaining maximum ________ and optimal policy aiming at this goal. net wealth ________ effects are those externalities which flow from the production or use of the good to other parties or economic units. Third party An upward sloping demand curve is called ________ exceptional demand curve In the context of formulating an investment project, ________ feasibility means the availability of supervisors for implementing and running the project smoothly and professionally. management When demand for the product increases in the same proportion in which income increases, Income elasticity of demand will be equal to________ unity Under the decreasing returns to scale, the marginal output curve slopes ________. downward On the ________ level, the summation of maximum individual welfare does not automatically lead to maximum social welfare. macro Goods which are paradoxical to the law of demand are ________ Giffen goods, , The index numbers which are compiled to measure the changes in retail prices of various commodities refers to ________ Retail prices index 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. divisible Negative slope means curve slopes downwards from________ left to left Perfectly elastic demand curve is ________ horizontal In the context of externalities, driving the smoke-emitting buses and trucks in the cities is an example of ________ cost. social The liability of a Karta in a Joint Hindu Family Business firm is ________. limited The indivisible goods to which the principle of exclusion does not apply are called ______ goods. pure public Quantitative credit control measures such as ______ operations, change in the bank rate, and changes in the_______ ratios open market, statutory reserve 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. price index, retail price The public enterprises refer to enterprises which are ________ managed and ________ by the government either central or state or local self governments. owned, controlled A private limited company can be formed with ________ members maximum excluding ________ of the company. Two to fifty, employee shareholders Oligopoly is a type of ________ market. A ________ exists in the industry Imperfect, few firms 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 Price-quantity, demand The rate of interest, according to ________, depends upon two factors: (i) ________ and (ii) the quantity of money Keynes, the liquidity preference function According to Keynes, the ______ between the aggregate demand function and the aggregate supply function can, and often does, take place at a point ______ Equilibrium, less than full employment The problem of unlimited wants and limited ________ with ________ uses has been forever confronting mankind. Means, alternative Keynes defined the ________ efficiency of ________ as the highest rate of return over cost expected from producing an additional unit of a special asset. Marginal, capital 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. Ratio, change 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. Expansion, sunk 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) Increased, marginal The ‘fiscal policy’ refers to the variations in taxation and ______ expenditure programmes by ________ to achieve the predetermined objectives. Public, government 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. Unfair, consumer’s health. Other things being equal, the higher ________ of commodity, the smaller is the quantity ________ and lower the price, larger is the quantity demanded. Demand, Price. Every nation's ________ are insufficient to produce the quantities of ________ than would be required to satisfy all of its citizens' wants. Resources, Goods & Services. 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. Profit, Accountants. There are two factors determining the __________ functions, namely (i) __________ and (ii) the rate of interest Marginal efficiency of capital, The investment. Minimum ________ persons have to come together to start a jointstock company. Those who take initiative to start it are called ________. Seven, Promoters. 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. Decision, Statistics. 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 all of them. Co-operation, Voluntary. Economists like A.C. Harberger have shown that the cost benefit analysis can be applied to ________ analysis. General equilibrium Goods which are paradoxical to the law of demand are ________ Giffen goods. The necessary condition of profit maximization of a firm is that Marginal Revenue (M.R) must be equal to ________. Marginal cost (M.C) The private sector is owned by ________. private individuals 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 ________. shadow prices When a firm’s average revenue (A.R.) is equal to its average cost (A.C.), it gets ________. Normal profit Sole Proprietorship which is also called sole ________ Tradership Under monopoly, the entire supply is controlled by ________. One sellers The important feature of monopolistic competition is ________. Product differentiation Under perfect competition, price is determined by the interaction of total demand and ________. Total supply The market price is determined by the interaction of the market demand curve and ________. Supply curve When people expect a rise in prices, businessmen ________ their investment & this leads in the demand for capital goods to Increase. Increase Problems regarding economy’s capacity to produce goods and services growing from year to year or is it remaining static are the topics in the Theory of ________. Economic growth The supply of agricultural goods is ________. Inelastic When there is ________ in foreign demand for the goods manufactured in a country, exports increase and prices of commodities in the country Increase. Increase The Dual prices system was adopted by the Government in case of ________. Essential goods During Nineties & Eighties, the CRR was raised from 6% to statutory maximum of ________. 0.15 When supply increases, demand remaining the same, the equilibrium price ________. Falls Advertising forms an integral part of decision-making and________. Forward - planning Statutory Reserve ratios are quantitative credit control measures undertaken by ________. The State Bank of India Oligopoly is a type of ________. Imperfect market Economists like A.C.Harberger have shown that the cost benefit analysis can be applied to ________ analysis. general equilibrium The indivisible goods to which the principle exclusion does not apply are called ________ goods. pure public Disclosures should provide ________ and relevant data to shareholders. transparent ________ is one of the major barriers to entry. Government policy Quantitative credit control measures such as ________ operations, change in the bank rate, and changes in the ________ ratios open market statutory reserve Under perfect competition, ________ is determined by the interaction of total ________ and total supply in the market price demand According to Prof. Ackley, “________ economics deals with economic affairs in the large it concerns the ________ of economic life”. macro overall dimensions Economics is a ________ , which studies human behaviour as a relationship between ________ , which have alternative uses. science ends and scarce means The production function is the name given to the ________ between the rates of ________ of productive services and rate of output of a product relationship input Internal economies are those advantages of large- scale ________ , which accrue to a ________ on account of its superior techniques and management production firm 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. proportionate change 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 Production costs Selling costs 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 expansion sunk Administered ________ are normally set on the basis of cost plus a ________ margin of profit prices stipulated Under monopoly, there is ________ seller who controls the entire ________ in the market only one supply 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 investments worth 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 entrepreneur employment 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. land and minerals human capacity The ________-taking theory was developed by the ________ . According to him, profit arises because considerable amount of risk is involved in business. American economist Hawley risk 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. price price elasticity Wholesale ________ index numbers measure the ________ in the general price level of a country. Price changes The money payment, which a firm makes to those ________ who supply labour services, raw materials, transport services, electricity etc. are called ________ costs. outsiders explicit 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 1932 persons Minimum ________ persons have to come together to start a jointstock company. Those who take initiative to start it are called ________ . seven promoters 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 debenture money The joint sector is a form of ________ between the ________ and the government. partnership private sector Other things being equal, the higher ________ of commodity, the smaller is the quantity ________ and lower the price , larger is the quantity demanded. demanded price 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 Keynesian aggregate The rate of interest, according to ________ , depends upon two factors: (i) ________ and (ii) the quantity of money Keynes the liquidity preference function Managerial ________s generally refers to the integration of economic theory with ________ practice. economic business The problem of unlimited wants and limited ________ with ________ uses has been forever confronting mankind. means alternative 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 Co-operation voluntary Like all organism, the ________ , too is an organism, according to the ________ theory. firm life-cycle theory Indices constructed for one ________ should not be ________ for other purposes where they not be fully appropriate and given erroneous conclusions. purpose used Under monopsony, there are ________ sellers but ________ buyer many only one By using cost-benefit analysis we can show the ________ necessary for attaining maximum ________ and optimal policy aiming at this goal measures net wealth 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 schedule revenues 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 decision making statistics Individual or sole ________ , which is also called sole- ________ , or single entrepreneurship is the most common, the simplest and the oldest form of business organisation. proprietorship trader ship Nominal cost is the ________ cost of production, it is also called expenses of production. The real cost is the ________ cost of production. money opportunity The costs of self owned resources, which are employed by the ________ , are non- expenditure or , ________ firm implicit costs . Greater scope for the ________ sector may mean incremental ________ , which connotes the expansion of public sector undertakings, can be left to some private companies private disinvestments Where ________ is charging a ________ in the home market and a lower price in the international market, it is called Dumping monopolist higher price The number of sellers operating under this type of competition is ________ under oligopoly, but less than under ________ larger than perfect ompetition In the words of ________ , “inflation occurs when the ________ of prices and cost is rising”. Prof. Samuelson general level 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. a single no effect 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 Profit accountants The demand curve is ________ representation of a demand schedule, demand curve slopes ________ ward from left to right. graphical down The ________ that is ________ is the opportunity cost of the commodity produced. commodity sacrificed Consumers protection involves protection from ________ trade practices for the purpose of promoting sales and making money at the cost of the ________ and well being unfair consumers health Managerial Economics List of Attempted Questions and Answers  Multiple Choice Single Answer 1   Question     Correct Answer    Multiple Choice Single Answer 2   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer   Single Answer Single Answer 3 Single Answer 4 Single Answer 5 Single Answer 6 Single Answer 7 Single Answer 8 Single Answer 9 10 Single Answer 11 Single Answer 12 Single Answer 13 14  Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer 15 16   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer Single Answer 17 18 19 Single Answer 20 Single Answer 21 Single Answer 22 Single Answer 23 24 25 26 27 27   Question     Correct Answer    Multiple Choice Single Answer 28   Question     Correct Answer    Multiple Choice Single Answer 29   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice Single Answer Single Answer 30 Single Answer 31 Single Answer 32 Single Answer 33 Single Answer 34 35   Question     Correct Answer    Multiple Choice Single Answer 36   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer 37 38 39 40 40   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer 41 42 43 44 45 46 47   Question     Correct Answer    Multiple Choice Single Answer 48   Question     Correct Answer    Multiple Choice Single Answer 49   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question   Single Answer 50 Single Answer 51 Single Answer 52 Single Answer 53 53   Correct Answer    Multiple Choice Single Answer 54   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice Single Answer 55 56 Single Answer 57 Single Answer 58 Single Answer 59 Single Answer 60 61   Question     Correct Answer    Multiple Choice Single Answer 62   Question     Correct Answer    Multiple Choice Single Answer 63   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer 64 65 66 66   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer Single Answer 67 Single Answer 68 Single Answer 69 Single Answer 70 Single Answer 71 Single Answer 72 Single Answer 73 Single Answer 74 75 76 77   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question   78 79 79 80   Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer 81 82   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer Single Answer 83 Single Answer 84 Single Answer 85 Single Answer 86 Single Answer 87 Single Answer 88 Single Answer 89 90 91 92 93 93   Question     Correct Answer    Multiple Choice Single Answer 94   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question     Correct Answer    Multiple Choice Single Answer   Question   Single Answer 95 96 97   Correct Answer    Multiple Choice 98   Question     Correct Answer    Multiple Choice 99   Question     Correct Answer    Multiple Choice 100   Question     Correct Answer    Multiple Choice 101   Question   Single Answer Single Answer Single Answer   Correct Answer    Multiple Choice 102   Question     Correct Answer    Multiple Choice 103   Question     Correct Answer    Multiple Choice 104   Question     Correct Answer    Multiple Choice 105   Question   Single Answer Single Answer Single Answer Single Answer   Correct Answer    Multiple Choice Single Answer 106   Question     Correct Answer    Multiple Choice Single Answer 107   Question   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  Question     Correct Answer    Multiple Choice Single Answer 123   Question     Correct Answer    Multiple Choice Single Answer 124   Question     Correct Answer    Multiple Choice Single Answer 125   Question     Correct Answer    Multiple Choice Single Answer 126   Question   127 128 129 130   Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice Single Answer Single Answer Single Answer Single Answer Single Answer 131   Question     Correct Answer    Multiple Choice Single Answer 132   Question     Correct Answer    Multiple Choice Single Answer 133   Question   134 135 136 137   Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice   Question     Correct Answer    Multiple Choice Single Answer Single Answer Single Answer Single Answer Single Answer 138   Question     Correct Answer    Multiple Choice Single Answer 139   Question     Correct Answer    Multiple Choice Single Answer 140   Question     Correct Answer    Multiple Choice Single Answer 141   Question     Correct Answer    Multiple Choice Single Answer 142   Question     Correct Answer    Multiple Choice Single Answer 143   Question     Correct Answer    Multiple Choice Single Answer 144   Question     Correct Answer    Multiple Choice Single Answer 145   Question     Correct Answer    Multiple Choice Single Answer 146 146   Question     Correct Answer    Multiple Choice Single Answer 147   Question     Correct Answer    Multiple Choice Single Answer 148   Question     Correct Answer    Multiple Choice Single Answer 149   Question     Correct Answer    Multiple Choice Single Answer 150   Question     Correct Answer    Multiple Choice Single Answer 151   Question     Correct Answer    Multiple Choice 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Choice Single Answer 241   Question     Correct Answer    Multiple Choice Single Answer 242   Question     Correct Answer   Managerial Economics ist of Attempted Questions and Answers Managerial economics generally refers to the integration of economic theory with business Practice 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 insufficient Managerial economics is also understood to refer to applied economics The type economic problem is Universal The act of making goods and services is called production The act of using goods and services to satisfy wants is called Consumption The things that are produced by factors of production are called Commodities The concept of just distribution of national product is a normative Goods which are completely divisible and to them the principle of exclusion applies in full measure are Pure private goods Market system of economy is characterized by consumer’s sovereignty Macro – economics provides an exploration to the functioning of an economy in general Depreciation is the value caused by the continuous use of a capital asset is loss Complementary goods are demanded jointly As per the law marginal product becomes negative when total product falls The law of diminishing returns is applicable to agriculture provided the state of technology is given and constant 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 fair AVC is the per unit variable cost of production The indivisible goods, whose benefits cannot be priced, and therefore, to which the principle of exclusion does not apply, are called Pure public goods Gross profit is the excess of total revenue of a firm over total expenditure Demand forecasting is predicting for the demand of a firm’s product in future In general, the demand for necessaries is relatively inelastic The indivisible goods whose benefits cannot be priced are called Pure public goods The income which a businessman might expect from the second best alternative use of his resources is called as opportunity cost The government has adopted a system of dual prices in the case of essential goods Market economy or private enterprise economy is a economy which is planless Supply curve shifts to the right side of the original supply curve when, the supply increases In cost benefit analysis, in the valuation of costs and benefits, for finding the present value, one has to make use of discount rate Partnership in case of general business consists of minimum two persons and maximum 20 persons The externalities which cannot be priced in the market with reference to the demand and supply behavior are termed as non - market external effects During a period of rising prices (inflation), the goods and services are scarce Slope of supply curve is positive The act of manufacturing goods and services is called production True inflation starts only after reaching the level of full Employment The externality in which the consumption or production levels of an economic unit affect the other economic units in the economy is called technological externality The number of sellers operating under monopolistic competition as compare to oligopoly is larger All the man made resources which are used in the process of making other goods and services are called capital Managerial economics aims at providing help in the firms is decision making Inflation is characterized by demand which is in excess of supply A firm is a unit of production, where production is done with the aim to maximize profits In case of increase in the income, the rich person's demand for goods will be more Price of a product under perfect competition is determined by the interaction of total supply and :total demand The demand curve (A.R.) of a firm under perfect competition is perfectly elastic According to J.M. Keynes, the equilibrium between the aggregate demand function and the aggregate supply function can, and often does take place at less than full employment A group of firms dealing in the same line of business are called as Industry The products sold by different sellers under pure competition are of exactly the same quality According to the Government, the buildup of inflationary pressure during the Nineties was attributed to Higher Fiscal deficit All the free gifts of nature which are commonly called natural resources are known to economists as Land An assembly of several machines, linked together either physically or by processes capable of producing a given quantity of a product per day is plant In the cost – benefit analysis, after formulating various alternative project capacity, each of them has to be examined in terms of its feasibility Joint Stock Company succession is perpetual Over the years in India the govt. expenditure is increasing Change in income of a person may bring about in demand for goods. change Costs which increase because of the expansion of a firm are called costs incremental In economics the question related to the selection of methods with which commodities are produced is a subject matter of theory of production A Joint- Stock Company is owned by its share holders but it is managed by Board of Directors 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 Effective demand In Trade cycles the economic activity are ups and downs Inflation is a phenomena of in which prices rises According J.B.Clark, profit is the reward paid for Dynamism Emergence of close substitutes to the commodity in question may bring about demand to decrease 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 inelastic The government of India follows administered price policy in respect of commodities which are vital and produced in the :Public sector 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 technical The main objective of a co- operative organization is service With technological advances, with the given inputs, the flow of output increases In the Long run perfect competition and monopolistic competition the firm make profits which are normal In case of perfectly elastic supply, the supply curve is horizontal Production Function implies relationship between input & output All firms producing the homogenous or similar products together make an industry 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 :Divisible good The number of buyers & sellers operating under perfect competition is large Economic Profit takes in to account the implicit cost According to Prof. F.H. Knight, profit is a reward for uncertainty bearing The Government attempts to increase supplies of food grains and other essential goods in times of internal shortage through larger imports Economists call all human resources as labor Economists call all human resources mental, physical , inherited and acquired as Labour All the buyers and sellers operating under perfect competition have knowledge which is perfect The conditions of equilibrium of a firm are applicable to all markets None The price of a good and the exclusion princople together is divisibility The liability of a sole proprietary firm is unlimited New commodities due to technotogical progress may result in demand for traditional type of goods decrease In cost - benefit analysis, after the step of appraisal and selection of the project is the step of comparison of the cash flow According to many economists, the root cause of economic problem is scarcity Managerial economics aims at providing guidance to the firms for decision making In case of a Joint-Stock Company, the liability of share holders is limited For an economist, Tata Eng & Locomotive Company Ltd is a firm The profit which is surplus of revenue over and above all paid out cost is Accounting Profit In economics, demand means desire backed by adequate purchasing power When more units of a commodity are purchased in response to decline in price of that commodity, it is called as expansion of demand Demand for products like tea, betel, tobacoo, sigaratte is a matter of habit If the substitutes are relatively cheaper then the demand for the commodity in question will be less Saving is a private virtue In economics the questions related to the division of society’s output of goods and services among its members are topics in theory of distribution In economics the questions related to the dynamic or static ( otherwise) capacity of the economy to produce goods and services are topics in the theory of economic growth An industry is a group of firms dealing in the same line of business The demand for a commodity depends on the prices of its substitutes which are :Relative If the increase in all factors leads to a less than proportionate increase in output, then the returns to scale are decreasing Under monopoly the demand curve slopes downward Dalal Street in Bombay is known as Bombay Stock Exchange The city of Banaras has specialized in the manufacture of :Silk The suggestion of reasonable profit target as an alternative to the objective of profit maximization is by Joel Dean Public corporations are managed by the board of directors appointed by Government Peas & beas, groundnut oil & til oil, tea & coffee are examples of substitutes goods The supply curve during market period is perfectly inelastic The General Theory of Employment, Interest and Money in 1936 was published by J.M. Keynes According to J.M.Keynes, the equilibrium is established at the level less than full employment When input and output increase in the same proportion, the phase of returns are constant A place where buyers & sellers meet each other to effect a business transaction is known as Market Variable cost are those costs which vary with the level of output The crucial factor in determining the level of income and employment, according to Keynes is effective demand Often monopolies purposely keep certain factors of production idle creating artificial scarcities of their products as a result the prices rise In case of a pure public good, its marginal cost is zero The suggestion of maximization of balanced growth rate as another alternative objective of a firm's profit is suggested by Prof. Morris When with a rise in price, the total outlay falls, or with a fall in price, the total outlay rises, elasticity of demand is >1 Under monopoly entry of new firms is prohibited The economists who defined the term 'market' different from that of the traditional sense is :Jevons & Cournot Under , Perfect competition, when an individual buyer increases or reduces his demand , the total market demand is not all affected The principle of full employment equilibrium was stated by Say's Law of Market The feasibility, which includes the prospects of employment generation, development of backward areas, social groups comprises of Economic feasibility As far as its use is concerned, tuning in of a radio can be categorized as: Divisible A technical unit of given capacity of output is plant 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 LIFO Change in income of a person may result in demand for goods to change 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