Question:

Of the following economists who is considered as master of partial analysis?

A.

Alfred Marshall

B.

A.C.Pigou

C.

J.M.Keynes

D.

J.S.Mill.

Answer» a. Alfred Marshall

Question:

Implicit costs are:

A.

Equal to total fixed costs.

B.

Comprised entirely of variable costs.

C.

“Payments” for self-employed resources.

D.

Always greater in the short run than in the long run.

Answer» c. “Payments” for self-employed resources.

Question:

The convexity of an indifference curve shows:

A.

Diminishing MRS

B.

Increasing MRS

C.

Constant MRS

D.

None

Answer» a. Diminishing MRS

Question:

Variable costs are:

A.

Sunk costs.

B.

Multiplied by fixed costs.

C.

Costs that change with the level of production.

D.

Defined as the change in total cost resulting from the production of an

Answer» c. Costs that change with the level of production.

Question:

Under increasing returns to scale, which of the following is the nature of thelong run average cost curve?

A.

downward sloping

B.

upward rising

C.

parallel to output axis

D.

identical to short run average cost curve

Answer» d. identical to short run average cost curve

Question:

At the point of tangency the slope of indifference curve is

A.

differ from point to point

B.

is equal on the other side of the mid point

C.

is the same

D.

is increasing

Answer» c. is the same

Question:

Starting point of Keynesian economics is:

A.

Effective demand

B.

Individual demand

C.

Aggregate demand

D.

Market demand

Answer» a. Effective demand

Question:

Which cost is to be incurred by a firm even if output is zero:

A.

Opportunity cost

B.

Fixed cost

C.

Variable Cost

D.

Total cost

Answer» b. Fixed cost

Question:

When MPC is 0.5, the value of multiplier is:

A.

5

B.

0.5

C.

2

D.

4

Answer» c. 2

Question:

Saving is a function of

A.

Export

B.

Import

C.

Investment

D.

Income

Answer» d. Income