Economics - Study Mode

[#931] Which of the following are sources of growth?
Correct Answer

(D) All of the above

Explanation

Solution: Natural resources, Human capital and Physical capital all are sources of growth.

[#932] The IC curve approach assumes
Correct Answer

(D) All of the above

Explanation

Solution: The IC curve approach assumes Rationality, Consistency and Transitivity.

[#933] A higher indifference curve shows
Correct Answer

(A) A higher level of satisfaction

Explanation

Solution: A higher indifference curve shows a higher level of satisfaction. A higher indifference curve will represent a higher level of satisfaction than a lower indifference curve. In other words, the combinations which lie on a higher indifference curve will be preferred to the combinations which lie on a lower indifference curve.

[#934] In the case of two perfect substitutes, the indifference curve will be
Correct Answer

(A) Straight line

Explanation

Solution: In the case of two perfect substitutes, the indifference curve will be Straight line. This is because perfect substitutes have a fixed ratio of substitution. An indifference curve is usually concave towards the origin because the two goods are usually not perfect substitutes. This means that the exchange rate varies hence the slope of the line tangent to the curve (exchange rate) varies.

[#935] The profit seeking monopolist operates at a level of output, where
Correct Answer

(C) MR = MC