Question:

When MPS = 0.2, MPC will be

A.

0.8

B.

0.2

C.

1.2

D.

20

Answer» a. 0.8

Question:

The economic incentive for price discrimination depends on:

A.

prejudices of business managers.

B.

differences among sellers\ costs.

C.

a desire to evade antitrust legislation.

D.

differences among buyers\ demand elasticities.

Answer» d. differences among buyers\ demand elasticities.

Question:

Change in demand due to change in relative price alone is called:

A.

Income effect

B.

Substitution effect

C.

Price effect

D.

Ratchet effect

Answer» b. Substitution effect

Question:

Competition “among the few” is often called as:

A.

Duopoly

B.

Perfect competition

C.

Bilateral monopoly

D.

Oligopoly

Answer» d. Oligopoly

Question:

In a perfectly competitive market

A.

each firm sets its own price

B.

there are a few firms selling unique products

C.

when one firm ceases production, the market equilibrium price tends to rise

D.

none of the above. in a perfectly competitive market, firms sell homogenous products and

Answer» d. none of the above. in a perfectly competitive market, firms sell homogenous products and