Question:

Allocative efficiency occurs when the:

A.

minimum of average total cost equals average revenue.

B.

minimum of average total cost equals marginal revenue.

C.

marginal cost equals the marginal benefit to society.

D.

marginal revenue equals marginal benefit to society.

Answer» c. marginal cost equals the marginal benefit to society.

Question:

Who told Inflation is too much of money chasing too few goods:

A.

Coulbourn

B.

Keynes

C.

Friedman

D.

Samuelsson

Answer» a. Coulbourn

Question:

The following are conditions of perfect competition except

A.

Sellers are large in number

B.

Single buyer

C.

Commodity produced is homogenous

D.

Freedom to Entry and exit

Answer» b. Single buyer

Question:

If price is less than average cost, in the short-run, the competitivefirm can earn

A.

Normal profit

B.

Super normal profit

C.

Loss

D.

All of the above

Answer» c. Loss

Question:

The property of diminishing marginal product applies:

A.

only to workers in the short run

B.

applies to workers and any other variable inputs in the short run

C.

only to workers in the long run

D.

applies to workers and any other variable inputs in the long run

Answer» b. applies to workers and any other variable inputs in the short run

Question:

Which policy is recommended under flexible exchange rate system:

A.

No policy is needed

B.

Contractionary policy

C.

expansionary monetary policy

D.

Any policy.

Answer» c. expansionary monetary policy

Question:

The importance of time element in price determination was firstlyanalyzed by

A.

Adam smith

B.

Alfred Marshall

C.

David Ricardo

D.

J M Keynes

Answer» b. Alfred Marshall

Question:

Kinked demand curve explain which of the following features of oligopoly

A.

Selling cost

B.

Price rigidity

C.

Non price competition

D.

Product differentiation

Answer» b. Price rigidity

Question:

The marker structure with Perfect knowledge is called

A.

Perfect competition

B.

Monopoly

C.

Monopolistic competition

D.

Oligopoly

Answer» a. Perfect competition

Question:

A market with only one buyer and one seller is called

A.

Oligopsony

B.

monopsony

C.

Bilateral monopoly

D.

None

Answer» c. Bilateral monopoly