7498 + Interview Questions in Economics in Class 11 Page 102 InterviewSolution

5051.	In a perfectly competitive market"
Answer» FIRM is a PRICE MAKER and INDUSTRY is the price TAKER Firm is a price taker and industry is the price maker Both are price takers Both are price makers Solution :N/a

Discussion

5052.	When price of a good rises by Rs.10 per unit, the supply byfirm increases from 400 units to 8000 units . What was the original price, if Es = 1?
Answer» ANSWER :RS. 10

Discussion

5053.	What are volume discounts ?
Answer» SOLUTION :It is a discount (DEDUCTION) on PRICE when a large quantity is purchased.

Discussion

5054.	The mean ofweighted items is called weighted average.
Answer» Solution :The MEAN ofweighted ITEMS is called WEIGHTED average.

Discussion

5055.	Why is a firm under perfect competition a price taker and under monopolistc competition and perfect competition. Explain briefly
Answer» SOLUTION :N/a

Discussion

5056.	Briefly describe the characteristics of a perfectly competitve market.
Answer»

Discussion

5057.	Give formula of calculating arithmetic mean of a continuous series using direct method.
Answer» Solution :`BARX = (sumfm)/(SUM f) ` Here, `barX` = Arithmetic mean, f = FREQUENCY, `"m=Mid-value"=("lower limit + upper limit")/2=(l_(1)+l_(2))/2`

Discussion

5058.	A consumer's income is Rs 200. He spends it on purchase of goods X and Y. Prices of X and Y are Rs 40 and Rs 20 per unit respectively. Answer the following question. (a) Write the equation of his budget line. (b) Write two such combinations of X and Y which lie on the budget line. (c) Write two such combination of X and Y which are a part of his budget set but do not lie on his budget line
Answer» Solution :(a) Given : PRICE of `x (P_(x)) = Rs 40` Price of `y (P_(y)) = Rs 20`, Income of the consumer = Rs 200. Now, the equation of budget line will be, `40 + 20 y = 200` (b) (i) `1X + 8y`,(ii) `2x + 6y` (c) (i) `1 x + 2Y`, (ii) `2x + 2y`

Discussion

5059.	In the indifference Curve Analysis, the consumer is in equilibrium when :
Answer» Budget line is TANGENT to indifference curve. Indifference curve is convex. Both (a) and (B) NONE of the above ANSWER :C

Discussion

5060.	A family spending has to incease ,w hen the price incerases, Defend or refute.
Answer» SOLUTION :This statement is REFUTED. It is not necessary that family spending increases with increases in price. As the price rises, spending by family may: (a) increase (b) DECREASE or (c) remian same , depending upon elasticity of dmeand. (a)In case of goods having less ELASTIC DEAMAND , expenditure by the family will increase, if the price rises ( e.g in case of necessities like salt, textbooks etc.) (b) In case of goods haviing highly elastic demand , expenditure will decrease, if the price rises ( e.g in case of luxuries like AC, cars etc.) (c) in case of goods having unitary elastic demand, spending / expenditure will not change with rise in price of the good ( e.g in case of normal goods, fans, refrigerator etc. )

Discussion

5061.	What is the relationshipbetween marginal cost and average variablecost ?
Answer» Solution :If the average variable cost falls DUE to an increase in the output, the marginal cost is less than the average variable cost. If the average variable cost RISES due to an increase in the output, the marginal cost is more than the average cost. Marginal cost is EQUAL to the average variable cost when the marginal cost is minimum.

Discussion

5062.	Define total revenue (TR)
Answer» Solution :TR is the total money RECEIPTS of the firm from sale of its total PRODUCT (OUTPUT) Symbolically : TR= Price x Output

Discussion

5063.	Histogram can only be formed with continuous classification of data. (true/false)
Answer» ANSWER :1

Discussion

5064.	The consumer will be in equilibrium where there is tangency between price line and indifference curve because at this point
Answer» `MRS lt` Price Ratio `MRS GT` Price Ratio `MRS =` Price Ratio None of these Answer :C

Discussion

5065.	Supply curve is the rising portion of marginal cost curve over and above the minimum of Average Variable cost curve'. Do you agree ? Support your answer with valid reason.
Answer» Solution :Yes, I agree that supply CURVE is the RISING portion of marginal, COST curve over and above the minimum of AVC curve. It is because that no producer (seller) would be prepared to SELL his production in the market, if he is not able to recover AVC as it would bring losses to him between the range of minimum MC and minimum AVC.

Discussion

5066.	Which of the followng is an assuming of Production Possibility Frontier?
Answer» RESOURCES are not fully employed. Resources are not EQUALLY effcient for production of the two goods. Resources are not efficiently employed. Resources AVAILABLE are not fixed. Solution :B. Resources are not equally efficient for all type of goods (to increase production of ONE unit of good 1 we have to sacrifice more and more( 2,3,4,5,) units of good 2)

Discussion

5067.	The problem of 'how to produce' incolves choice between consumer goods and capital goods.
Answer» Solution :The problem of 'how to PRODUCE' deals with CHOICE of TECHNIQUE to be used for PRODUCTION of GOODS and services.

Discussion

5068.	In_________, values of two or more than two variables are simultaneously shown with respective to some period of time.(one variable graphs/two variable graphs)
Answer» ANSWER :TWO VARIABLE GRAPHS

Discussion

5069.	The item having the highest weight in consumer price index for industrial workers is : (i) food(ii) housing(iii) clothing
Answer» ANSWER :(i)

Discussion

5070.	Costs that have been already incurred are importantfactors in making production decisions.
Answer» Solution :FALSE. COSTS that are STILL to be incurred are IMPORTANT FACTORS in making production decisions.

Discussion

5071.	AR curve always remain above MR curve.
Answer» SOLUTION :FALSE : AR CURVE remains above MR curve only when price falls with rise in output. If price remains same, then both AR and MR curves coincide in a horizontal straight line parallel to the X-axis.

Discussion

5072.	What are monotonic preferences ? Explain why an indifference curve to the right shows higher utility
Answer» Solution :MONOTONIC preferences REPRESENTS that a consumer will prefer a combination which contains more of at least one and no LESS of the other. The higher indifference CURVE shows higher level of satisfaction as it provides higher quantities of the commodities which a consumer wishes to consume.

Discussion

5073.	Ten players of the Australian team made an average an average of 63 runs and ten players of the Indian team made an average of 77 runs. Calculate the average run made byboth the teams.
Answer» ANSWER :COLLECTIVE AVERAGE RUN = 70

Discussion

5074.	What is meant by purposive of deliberate sampling ?
Answer» Solution :PURPOSIVE sampling is that method in which the investigator himself MAKES the CHOICE of the SAMPLE items which in his opinion are the BEST representative of the universe.

Discussion

5075.	If TR curve is a horizontal straight line parallel to the X-axis, then MR curve will:
Answer» Coincide with X-axis SLOPE DOWNWARDS Slope upwards horizontal STRAIGHT line parallel to the X-axis SOLUTION :N/A

Discussion

5076.	State the central problems of an economy.
Answer» SOLUTION :1) What to PRODUCE?2) How to produce?3) For whom to produce?

Discussion

5077.	What is the effect on price when a firm under monopolistic competition sells more ?
Answer»

Discussion

5078.	Answer the following questions with the help of following diagram: Which of the following point trpersent fuler and efficient utilisation of respurces?
Answer» B G F None of these. Solution :A. Points on the PPC representsfuller and EFFICIENT UTILIZATION of RESOURCES.

Discussion

5079.	Definerandom sampling. How is it different from haphazard sampling?
Answer» Solution :In RANDOM SAMPLING method, the items in the sample are CHOSEN at random. In other WORDS, each and every item of the universe has an equal chance of being SELECTED in the sample. ... However, haphazard sampling is one of the nonstatistical technique that deliberately trying to imitate like random method

Discussion

5080.	Discuss the relationship between AR and MR when: (i) Price remains constant. (ii) Price falls with rise in output.
Answer» Solution :For a PRICE TAKING firm, AR = Price. HENCE when, (i) price or AR remains constant, AR is EQUAL to MR. (ii) price falls with RISE in output, MR is less than AR.

Discussion

5081.	Long run cost consists of:
Answer» Variable cost FIXED cost PARTLY variable and partly fixed cost MOSTLY variable cost. ANSWER :A

Discussion

5082.	If MC is more than MR at a particular level output then how will aproducer react to maximise theprofits?
Answer» SOLUTION :PRODUCER will REDUCE the production to maximise the PROFIT.

Discussion

5083.	How does theimpositionof aunittax affectsthe supply curveof a firm ?
Answer» Solution :The supplycurvewill shiftto the left as the imposition of tax on the good will reduce its PROFIT margin due tothe INCREASE in its cost.

Discussion

5084.	In ________ index numbers, all items of the series are accordedequal weightage. "" (Simple/Weighted)
Answer» ANSWER :SIMPLE

Discussion

5085.	Labour- internsive techniques are chosen in a:
Answer» Labour-surplus ECONOMY Capital-sulphur economy Developed economy Developing economy Solution :A. Industry or process where a larger PORTION of total costs is due to labor as compared with the portion for costs incurred in purchase, maintenance, and depreciation of capital EQUIPMENT. AGRICULTURE, CONSTRUCTION, and coal-mining industries are examples of labor intensive industries

Discussion

5086.	Discuss the meaning of prodcution possibility frontier with the help of a chedule and diagram
Answer»

Discussion

5087.	Firms under oligopoly are interdependent.
Answer» Solution :There exists high degree of INTERDEPENDENCE as each FIRM considers the ACTION and reaction of rival FIRMS while determining its price and output LEVELS.

Discussion

5088.	Excess of marginal revenue over marginal cost is always better than equality between the two in order to achieve the equilibrium for a producer.
Answer» Solution :Producer will no beat EQUILIBRIUM when MARGINAL revenue (MR) is more than marginal COST (MC) as it will be POSSIBLE to increase profits by producing more. So, equaility between MR and MC is a better situatio.

Discussion

5089.	A few big sellers is a characteristics of:
Answer» PERFECT competition Monopolistic Competition Oligopoly None of these Solution :N/a

Discussion

5090.	A consumer prefers to buy more of 'Y' as compared to 'X' when :
Answer» `MU_X=P_X` `MU_X GT P_X` `(MU_X)/P_X LT (MU_Y)/P_Y` `(MU_X)/P_X gt (MU_Y)/P_Y` SOLUTION :C

Discussion

5091.	Why does an indifference curve slope downwards ?
Answer» Solution :An INDIFFERENCE curve slopes DOWNWARDS because increase in units of one good requires decrease in the number of units of another good to MAINTAIN the same level of SATISFACTION.

Discussion

5092.	The equation of budget line is:
Answer» `P_1x_1+P_2x_2=M` `P_1x_1+P_2x_2leM` `P_1x_1+P_2x_2gtM` NONE of these Solution :A

Discussion

5093.	What is the meant by universe ?
Answer» Solution :In statics, UNIVERSE or population refers to an AGGREGATE of ITEMS to be studied for an INVESTIGATION.

Discussion

5094.	A consumer consumes only two goods, If price of one of the goods falls, the indifference curve: (Choose the correct alternative)
Answer» SHIFTS UPWARDS Shifts downwards Can SHIFT both upwards or downwards Does not shift Answer :D

Discussion

5095.	How is TVC derived from MC schedule ?
Answer» SOLUTION :`TVC = sumMC`

Discussion

5096.	Giving reasons, state whether the following statement are true or false : (i) Excess supply of a commodity exists when its market price is greater than equilibirum price.
Answer» Solution :TRUE. If the market SUPPLY is greater than the equilibrium price there will be excess supply since PRODUCERS will now be incentivized by the HIGHER profits caused by higher PRICES.

Discussion

5097.	Why is budget line a straight line? Explain
Answer» Solution :A straight budge line depicts the CONSTANT SLOPE of the budget line. The slope of the budget line given by the RATIO of the price of the two goods (- P1/ P2). Constant slope and thereby, straight line is in accordance with the ASSUMPTION that the prices of the two goods are given.

Discussion

5098.	What is meant by magnitude of a class interval?
Answer» SOLUTION :MAGNITUDE of a class interval is the DIFFERENCE between the upper LIMIT and the lower limit of a class.

Discussion

5099.	From the following table, find out the level of output at which the producer will be in equilibrium.
Answer» ANSWER :4 UNITS of OUTPUT

Discussion

5100.	What is the shape of AR curve when (i) TR curve is a positively sloped straightline passing through the origin (ii) TR curve is a horizontal line ?
Answer» SOLUTION :(i) AR CURVE will be PARALLEL to the X-axis (ii) AR curve will slope DOWNWARDS.

Discussion

Explore topic-wise InterviewSolutions in .

In a perfectly competitive market"

When price of a good rises by Rs.10 per unit, the supply byfirm increases from 400 units to 8000 units . What was the original price, if Es = 1?

What are volume discounts ?

The mean ofweighted items is called weighted average.

Why is a firm under perfect competition a price taker and under monopolistc competition and perfect competition. Explain briefly

Briefly describe the characteristics of a perfectly competitve market.

Give formula of calculating arithmetic mean of a continuous series using direct method.

In the indifference Curve Analysis, the consumer is in equilibrium when :

A family spending has to incease ,w hen the price incerases, Defend or refute.

What is the relationshipbetween marginal cost and average variablecost ?

Define total revenue (TR)

Histogram can only be formed with continuous classification of data. (true/false)

The consumer will be in equilibrium where there is tangency between price line and indifference curve because at this point

Supply curve is the rising portion of marginal cost curve over and above the minimum of Average Variable cost curve'. Do you agree ? Support your answer with valid reason.

Which of the followng is an assuming of Production Possibility Frontier?

The problem of 'how to produce' incolves choice between consumer goods and capital goods.

In_________, values of two or more than two variables are simultaneously shown with respective to some period of time.(one variable graphs/two variable graphs)

The item having the highest weight in consumer price index for industrial workers is : (i) food(ii) housing(iii) clothing

Costs that have been already incurred are importantfactors in making production decisions.

AR curve always remain above MR curve.

What are monotonic preferences ? Explain why an indifference curve to the right shows higher utility

Ten players of the Australian team made an average an average of 63 runs and ten players of the Indian team made an average of 77 runs. Calculate the average run made byboth the teams.

What is meant by purposive of deliberate sampling ?

If TR curve is a horizontal straight line parallel to the X-axis, then MR curve will:

State the central problems of an economy.

What is the effect on price when a firm under monopolistic competition sells more ?

Answer the following questions with the help of following diagram: Which of the following point trpersent fuler and efficient utilisation of respurces?

Definerandom sampling. How is it different from haphazard sampling?

Discuss the relationship between AR and MR when: (i) Price remains constant. (ii) Price falls with rise in output.

Long run cost consists of:

If MC is more than MR at a particular level output then how will aproducer react to maximise theprofits?

How does theimpositionof aunittax affectsthe supply curveof a firm ?

In ________ index numbers, all items of the series are accordedequal weightage. "" (Simple/Weighted)

Labour- internsive techniques are chosen in a:

Discuss the meaning of prodcution possibility frontier with the help of a chedule and diagram

Firms under oligopoly are interdependent.

Excess of marginal revenue over marginal cost is always better than equality between the two in order to achieve the equilibrium for a producer.

A few big sellers is a characteristics of:

A consumer prefers to buy more of 'Y' as compared to 'X' when :

Why does an indifference curve slope downwards ?

The equation of budget line is:

What is the meant by universe ?

A consumer consumes only two goods, If price of one of the goods falls, the indifference curve: (Choose the correct alternative)

How is TVC derived from MC schedule ?

Giving reasons, state whether the following statement are true or false : (i) Excess supply of a commodity exists when its market price is greater than equilibirum price.

Why is budget line a straight line? Explain

What is meant by magnitude of a class interval?

From the following table, find out the level of output at which the producer will be in equilibrium.

What is the shape of AR curve when (i) TR curve is a positively sloped straightline passing through the origin (ii) TR curve is a horizontal line ?