» Micro Economics 1 solved MCQs

The larger the diameter of a natural gas pipeline, the lower is the average total cost oftransmitting 1,000 cubic feet of gas 1,000 miles. This is an example of:

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Question:

The larger the diameter of a natural gas pipeline, the lower is the average total cost oftransmitting 1,000 cubic feet of gas 1,000 miles. This is an example of:

A.

Economies of scale.

B.

Normative economies.

C.

Diminishing marginal returns.

D.

An increasing marginal product of labour.

Answer» a. Economies of scale.

Note: The above multiple-choice question is for all general and Competitive Exams in India. 

If negative income effect is less than positive substitution effect : the productwill be

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Question:

If negative income effect is less than positive substitution effect : the productwill be

A.

a normal good

B.

an inferior good

C.

a giffen good

D.

a complementary good

Answer» b. an inferior good

Note: The above multiple-choice question is for all general and Competitive Exams in India. 

According to Marshall, The law of diminishing marginal utility

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Question:

According to Marshall, The law of diminishing marginal utility

A.

applies on money in the manner in which it applies on commodity

B.

do not applies on money except bank money

C.

does not applies on bank money but applies on cash

D.

applies on all commodities except money

Answer» d. applies on all commodities except money

Note: The above multiple-choice question is for all general and Competitive Exams in India. 

When a firm doubles its inputs and finds that its output has more than doubled, this isknown as:

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Question:

When a firm doubles its inputs and finds that its output has more than doubled, this isknown as:

A.

Economies of scale.

B.

Constant returns to scale.

C.

Diseconomies of scale.

D.

A violation of the law of diminishing returns.

Answer» a. Economies of scale.

Note: The above multiple-choice question is for all general and Competitive Exams in India.