Economics - Practice Test | ExamPrepSheets

[#421] Elasticity of demand is equal to unity while marginal revenue is

(A) positive

(B) zero

(C) negative

(D) indeterminate

Correct Answer

(B) zero

[#422] Which one of the following does not explain the basic nature of business economics?

(A) Behaviour of firms in theory and practice

(B) Distribution theories like rent, wages and interest along with the theory of profit

(C) Use of the tools of economic analysis in clarifying problems in organising and evaluating information and in comparing alternative courses of action

(D) Integration of economic theory with business practices for the purpose of facilitating decision-making

Correct Answer

(B) Distribution theories like rent, wages and interest along with the theory of profit

[#423] Match the following. List-I List-II a. Excess of profit total revenue over total explicit cost 1. Normal Profit b. Total profit revenue equals total economic cost 2. Economic Profit c. Excess of total revenue over total of explicit and implicit costs and a normal rate of return 3. Accounting Profit

(A) a-3, b-1, c-2

(B) a-2, b-1, c-3

(C) a-1, b-2, c-3

(D) a-1, b-3, c-2

Correct Answer

(A) a-3, b-1, c-2

[#424] A firm in perfect competition will have long run equilibrium when

(A) AR > AC

(B) MR = MC = AR = AC

(C) MR = MC but AC < AR

(D) AC = AR

Correct Answer

(B) MR = MC = AR = AC

[#425] Extension and contraction of demand are result of

(A) change in consumer's income

(B) change in consumer's tastes

(C) change in price

(D) none of these

Correct Answer

(C) change in price

Economics - Study Mode

[#421] Elasticity of demand is equal to unity while marginal revenue is

Correct Answer

[#422] Which one of the following does not explain the basic nature of business economics?

Correct Answer

Correct Answer

[#424] A firm in perfect competition will have long run equilibrium when

Correct Answer

[#425] Extension and contraction of demand are result of

Correct Answer