Economics - Study Mode

[#471] Which is not a central problem of an economy?
Correct Answer

(C) How to maximize private profit

Explanation

Solution: How to maximize private profit is not a central problem of an economy. Some of the central problems that are faced by every economy of a country are as follows: Production, distribution and disposition of goods and services are the basic economic activities of life. In the course of these activities, every society has to face scarcity of resources.

[#472] A significant property of the Cobb-Douglas production function is that the elasticity of substitution between inputs is
Correct Answer

(A) Equal to 1

Explanation

Solution: A significant property of the Cobb-Douglas production function is that the elasticity of substitution between inputs is Equal to 1.

[#473] Who is generally regarded as the founder of the 'Classical School'?
Correct Answer

(B) Adam Smith

Explanation

Solution: Adam Smith is generally regarded as the founder of the 'Classical School'.

[#474] Union leaders are in better position to bargain for higher wages if demand for labour is
Correct Answer

(B) Inelastic

Explanation

Solution: Union leaders are in better position to bargain for higher wages if demand for labour is Inelastic. The capacity of trade unions to raise wages in a particular industry depends on the elasticity of demand for labour.

[#475] The price discrimination policy helps in increasing profits in the case of
Correct Answer

(B) Monopolistic competition