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4751.

Why is the study of the problem of unemployment in India considered a macroeconomic study?

Answer»

SOLUTION :The study of UNEMPLOYMENT is considered a macroeconomic study as it RELATES to the India ECONOMY as a whole.
Discussion
4752.

A consumer consumes only two goods X and Y. At a consumption level of these two goods, he finds that the ratio of marginal utility of price in case of X is higher than in case of Y. Explain the reaction of the consumer.

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SOLUTION :It means that at some consumption LEVEL, `(MU_(X))/(P_(X)) gt (MU_(Y))/(P_(Y))`. In this case, the consumer is GETTING more marginal utility per rupee in case of good X as compared to Y. THEREFORE, he will buy more of X and less of Y. this will LEAD of fall in `MU_(X)` and rise in `MU_(Y)`. The consumer will continue to buy more of X till `(MU_(X))/(P_(X)) = (MU_(Y))/(P_(Y))`
Discussion
4753.

When APP is maximum, what is the relation between MPP and APP ?

Answer»


ANSWER :MPP is EQUAL to APP.
Discussion
4754.

When can MR be zero and negative ?

Answer»

Solution :(i) MR can be ZERO and even NEGATIVE, if the price FALLS with the rise in output.
(ii) MR, cannot be zero or negative when price remains CONSTANT at all LEVELS of output.
Discussion
4755.

Marginal Product refers to addition to total output when one more :

Answer»

Unit is prosuced
Unit is sold
Unit is consumed
Unit of variable factor factor is employed

Solution :D. Marginal PRODUCT REFERS to ADDITION to TOTAL OUTPUT when one more Unit of variable factor factor is employed.
Discussion
4756.

What is the problem of 'How to produce'?

Answer»

Solution :It is the problem of CHOICE of technique i.e., LABOUR intensive or capital intensive to PRODUCE GOODS and services.
Discussion
4757.

If quantity supplied of a good increases by 80% due to a 40% increase in its price, then P,e_(s) is :

Answer»

`(+)2`
`(-)2`
`(+)0.5`
`(-)0.5`

ANSWER :A
Discussion
4758.

(i) AR is always equal to marginal revenue. (ii) Demand curve is intermediate. (iii) Selling costs are incured for informative purposes. (iv) Firms is a price taker (v) There are large number of firms selling differentiated product (vi) Firm is price maker (vii) Firmmay charge different prices for the same product from different consumers at the same time (vii) There is perfect knowledge among buyers and seller. (ix)There is complete interdependence among diferent firms. (x) Thismarket torm shares features of both perfect competition and monopoly.

Answer»

SOLUTION :Perfectly COMPETITION, (ii) OLIGOPOLY, (iii) Monopoly (iv) Perfect competition, (v) Monopolistic competition, (VI) Monopoly, (vi) Monopoly, (viii) Perfect Competition, (IX) Oligopoly, (x) Oligopoly, (x) Monopoly competition.
Discussion
4759.

How many chocolates will you consume if these are free of cost, to achieve equilibrium

Answer»

MU is +ve
MU is -ve
MU is zero
None of these

Solution :C
Discussion
4760.

Demand of flasts in a particular society is rising causing rise in their prices. On the other hand law of demand states inverse relation between price and demand of a commodity. Why is this contradiction ? Do economists say inconsistent things ?

Answer»

Solution :There is no contradiction, ALSO economists do not SAY inconsistent things about relation between price and demand of a commodity. We need to UNDERSTAND the CAUSE and effect relation between the two.
Ifdemand of the commodity RISES, it will cause price rise due to competition among buyers.
If price rises, it will cause fall in demand of the commodity (law of demand).
Discussion
4761.

______ measures the slope of indifference curve.

Answer»

BUDGET Line
Marginal RATE of Substitution
Marginal Rate of Transformation
None of these

Answer :B
Discussion
4762.

Average revenue and marginal revenue curves slope downwards when more output can be sold by reducing the prices.

Answer»

SOLUTION :True : AVERAGE REVENUE (AR or price ) falls with increase in sale and revenue from every additional unit (i.e. MR) is less than AR. As a result, both AR and MR curves SLOPE DOWNWARDS from left to right.
Discussion
4763.

What is a cirrcular of pie diagram ?

Answer»


SOLUTION :Pie diagram is a circle DIVIDED into various SEGMENTS showing the par CENT values of a series.
Discussion
4764.

A consumer consumes two goods X and Y. What will happen if MU_(x)//P_(x) is greater than MU_(y)//P_(y)?

Answer»

Solution :if `MU_(X)//P_(x)` is greater than `MU_(y)//P_(y)`, the CONSUMER is getting more marginal utility in case of good X as compared to Y. Therefore, he will BUY more of X and LESS of Y. This will lead to fall in `MU_(x)` and Rise in `MU_(Y)` . The consumer will continue to buy more of X till `MU_(x)//P_(x)` = `MU_(y)//P_(y)`
Discussion
4765.

A perfectly elastic price-demand curve is parallel to the X-axis. Why or why not ?

Answer»

SOLUTION :A perfectly elasticdemand curve is parallel to the X-axis because the BUYERS are willing to buy any QUANTITY of the GOOD at a given price. \
Discussion
4766.

When the demand for a good falls due to an unfavourable change in the consumer's preferences, what is the change in demand called ?

Answer»

SOLUTION :DECREASE in DEMAND
Discussion
4767.

Show that demand for a commodity is inversely related to its price. Explain with the help of utility analysis.

Answer»
Discussion
4768.

Price Elasticity of Supply of a good is 2. It shows that:

Answer»

Inealstic supply
less ELASTIC supply
unitary elastic supply
HIGHLY elastic supply

Solution :when price ELASTICITY of supply is greater than 1, then the supply is highly elastic. our correct answer is (D).
Discussion
4769.

How will you get the market supply schedule from the supply schedules of individual firms?

Answer»

SOLUTION : Market supply SCHEDULE can be obtained by aggregating (horizontal summation of) the supply SCHEDULES of INDIVIDUAL FIRMS.
Discussion
4770.

What are monotonic preferences ? Explain why is an IC (i) downward sloping and (ii) convex

Answer»

Solution : Monotonic preference MEANS that a rational CONSUMER always prefers more of a commodity as it offers him a higher level of satisfaction. Monotone preferences essentially say that "more" is preferred to "less".
The indifference curves must slope down from left to right. This means that an indifference curve is NEGATIVELY sloped. It slopes downward because as the consumer increases the consumption of X commodity, he has to give up CERTAIN units of Y commodity in order to maintain the same level of satisfaction.
Indifference curves are convex to the origin because the marginal utility of each product consumed decreases with subsequent consumption. This convex relationship is based upon an IDEA dubbed the marginal rate of substitution, which is represented by the formula (Z = change in X / change in Y).
Discussion
4771.

Mode is :

Answer»

MIDDLE most item of a series
Most common VALUE in a series
SIMPLE average of the series
None of the above

SOLUTION :B
Discussion
4772.

One of the following is not the feature of a perfectly competitive market :

Answer»

Each FIRM has NEGLIGIBLE share in market supply
Each BUYER has negligible share in market demand
The firms are interdependent
The firms are free to LEAVE the market

Answer :C
Discussion
4773.

Will a profit maximising firm in a competitive market produce a positive level of output in the long run if market price is less than the minimum AC ? Give an explanation.

Answer»

Solution :No, because in the LONG RUN all firms enjoy normal profits due to free entry and exit i.e., PRICE = AC. If market price is LESS than AC, the FIRM will never operate.
Discussion
4774.

Define Average Product.

Answer»

Solution :AVERAGE PRODUCT refers to output per UNIT of variable INPUT.
Discussion
4775.

Make suitable schedules to show that there is (i) simultaneous increase and (ii) simultaneous decrease both in demand and supply but there is no change in market price.

Answer»

Solution :
The EQUILIBRIUM price before simultaneous increase in demand and SUPPLY is Rs.2 i.e., at the EQUALITY of demand and supply. It remains the same even after simultaneous increase in both demand and supply by `100%`.

The equilibrium price before change is Rs.2. After simultaneous decrease in both demand and supply by `50%`, it remains the same.
Discussion
4776.

Explain the following (i) 'Price Discrimination' feature of Monopoly (ii) 'Selling Costs' feature of Monopolistic Competition (iii) 'Indeterminate Demand Curve' under Oligopoly (iv) 'Interdependence of firms' under Oligopoly (v) 'Price Rigidity' under Oligopoly

Answer»
Discussion
4777.

When average product is maximum, marginal product is greater than average product.

Answer»

Solution :False. When AVERAGE product is MAXIMUM, MARGINAL product will be equal to average product.
Discussion
4778.

Marginal utility is:

Answer»

the utility from FIRST UNIT of a COMMODITY consumed
the utility from the LAST unit consumed
total utility divided by number of units consumed
always positve.

Answer :B
Discussion
4779.

Microeconomics and macroeconomics are independent branches of economics.

Answer»

SOLUTION :MICROECONOMICS and MACROECONOMICS are INTERDEPENDENT.
Discussion
4780.

Who is a consumers?

Answer»

Solution :A CONSUMER is one who CONSUMES goods and services for the SATISFACTION of his wants.
Discussion
4781.

As the variable input is increased by one unit total output falls. What can you say about the marginal productivity of variable input ?

Answer»

SOLUTION :MARGINAL PRODUCT is NEGATIVE.
Discussion
4782.

In which market form, marginal revenue is equal to price?

Answer»

Monopoly
Oligopoly
Perfect COMPETITION
MONOPOLISTIC competition

Solution :C
Discussion
4783.

………………………. Is a person who helps the investigator in collecting data. (Enumerator/Respondent )

Answer»


SOLUTION :ENUMERATOR
Discussion
4784.

Median divides a series into how many parts ?

Answer»

Two
Three
Four
All of these.

Solution :MEDIAN DIVIDES a SERIES INTO2 PARTS
Discussion
4785.

In which quadrant, the value of X will be positive but that of Y will be negative ?

Answer»

1st
2nd
3rd
4th

Solution :D
Discussion
4786.

What does a point on PPC indicate ?

Answer»

SOLUTION :FULLER UTILISATION of RESOURCES.
Discussion
4787.

The given diagram is a case of …………….. Supply

Answer»

Less Elastic SUPPLY
HIGHLY Elastic Supply
Unitary Elastic Supply
Perfectly Elastic Supply

Solution :here,responsiveness of change in QUANTITY demanded due to the change in PRICE is GREATER than1.
Discussion
4788.

Define marginal physical product/marginal product.

Answer»

Solution :Marginal product is the addition to total product when ONE more UNIT of VARIABLE INPUT is EMPLOYED.
Discussion
4789.

Differentiate between cooperative and non-cooperative oligopoly.

Answer»
Discussion
4790.

How is coefficient of mean deviation calculated?

Answer»

Solution :In order to FIND out coefficient of MEAN deviation, mean deviation of the series is DIVIDED by the central TENDENCY of the series. Accordingly,
(i) Coefficient of MD from Mean`=(MD_(BARX))/(barX)=("Mean Deviation")/("Arithmetic Mean")`
(ii) Coefficient of MD from Median`=(MD_(bar m))/(M)=("Mean Deviation")/("Median")`
(iii) Coefficient of MD from Mode`=(MD_(z))/(Z)=("Mean Deviation")/("Mode")`
Discussion
4791.

Under what market condition does Average Revenue always equal Marginal Revenue ? Explain.

Answer»

Solution :It is under the market CONDITION when a firm can SELL more at the given price, that is AR = MR throughout as production is INCREASED by the firm. It is because the firm is a price taker. It means that price, which is same as AR, remains unchanged throughout. By the average- marginal relationship, AR remains unchanged only when AR = MR throughout.
Note : The question is asking about the market condition (whether price remains same or falls with rise in output) and NOT about the market form (PERFECT or Imperfect Market)
Discussion
4792.

What happens to equilibrium price of a commodity if there is an 'increase' in its demand and 'decrease' in its supply?

Answer»

SOLUTION :EQUILIBRIUM PRICE will INCREASE.
Discussion
4793.

As soon as marginalcost starts rising, average variable cost also starts rising.

Answer»

SOLUTION :False. AVC will rise only when `MC is GREATER than AVC`, whether MC is RISING or FALLING.
Discussion
4794.

Average variable cost can fall even when marginalcost is rising.

Answer»

Solution :TRUE, PROVIDED `MC lt AVC`.
Discussion
4795.

Calculate TP and AP : |{:("Variable Factor",1,2,3,4,5,6,7),("MP (in units)",24,20,16,12,8,0,-8):}|

Answer»

SOLUTION :
Discussion
4796.

Explain the implication of the following features of monopolistic competition. {:((a)" Differentiated products",(b)"Freedom of entry and exit of firms."):}

Answer»
Discussion
4797.

Explain the changes that will take place in the market' for a commodity if the prevailing market price is less than the equilibrium price.

Answer»

Solution :When the market price is less than the equilibrium price, there is excess demand in the economy. This excess demand will lead to competition among buyersas each buyer will WANT to BUY that commodity. Buyers would be ready to pay a HIGHER price to meet their demands which will push up the market price. With increase in price, market demand will fall due to LAW of demand and market supply will increase due to law of supply. Hence, a new equilibrium will be ACHIEVED, where price is at such a level where demand equals supply.
Discussion
4798.

Good Y is a substitute of good X. The price of Y falls. Explain the chain of effects of this change in the market of X.

Answer»

Solution :A fall in PRICE of Y leads to a decrease in demand for X. This decrease in demand leads to leftwards shift in the demand CURVE, CAUSING a higher competition among the sellers due to decreased demand. As a result, the sellers reduce the prices in order to sell their EXISTING stock. This fall in prices leads to an increase in quantity demanded and a fall in quantity supplied until a new equlibrium is achieved where quantity demanded equals the quantity supplied.
Discussion
4799.

Price and Average Revenue are :

Answer»

ALWAYS same
Always DIFFERENT
SOMETIMES same
Sometimes different

ANSWER :A
Discussion
4800.

The total cost of 5 unit of output is Rs 30. The fixed cost is Rs 5. The average variable cost of 5 unit of output is :

Answer»

RS 25
Rs 6
Rs 5
Rs 1

ANSWER :C
Discussion