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This section includes InterviewSolutions, each offering curated multiple-choice questions to sharpen your knowledge and support exam preparation. Choose a topic below to get started.
| 4901. |
In the short period the supply of a good is |
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Answer» PERFECTLY elastic |
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| 4902. |
Can there be a positive level of output that a profit maximising firm produces in a perfectly competitive market at which market price is not equal to marginal cost ? Explain. |
| Answer» SOLUTION :No, it is not POSSIBLE because MR = MC or P = MC is necessary condition for a perfectly competitive market to be in EQUILIBRIUM. If MR/P gt MC, there are more PROFITS possible and if P/MR lt MC, then there are LOSSES. | |
| 4903. |
What are the kinds of errors of you would expect in a fields surveys by census methods.? |
| Answer» Solution :The KINDS of ERRORS you would expect in a field SURVEY by the CENSUS METHOD are:Errors of measurementErrors due to lack of responseErrors due to miscalculations | |
| 4905. |
An indifference curve does not touch either of the axis.' Defend or Refute. |
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Answer» Solution :The given statement is defended. It happens because indifference curve ANALYSIS assumes CONSUMPTION of TWO goods. `**` If indifference curve touches Y-axis, it would mean that consumption of COMMODITY on the X-axis is zero. `**` Similarly, if indifference curve touches X-axis, it would mean that consumption of commodity on the Y-axis is zero. |
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| 4906. |
Identify implicit or explicit cost from the information given below. (i) An individual is both the owner and manager of the shop taken on rent. (ii) A producer borrows money and starts a business. He himself looks after the business. (iii) A manufacturer starts a business by investing his own savings and hiring the labour. (iv) A producer produces foodgrains using a farm taken on rent and with the help of family members. |
Answer» SOLUTION :
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| 4907. |
What is revenue of a firm ? Give meaning of average revenue and marginal revenuel. What happens to average revenue when marginal revenues is : (i) Greater than average revenue, (ii) Equal to average revenue , (iii) Less than average revenue ? |
| Answer» Solution :Revenue is total receipts generated from selling a particular NUMBER of units of a good by a firm. Average Revenue is the revenue PER unit of output sold in the market by a firm. MARGINAL Revenue is the additional revenue generated from selling an additional unit of output by a firm. (i) When MR is greater than AR then AR increases. (ii) When MR is equal to AR then both the curves coincide with each other and are parallel to x-axis. (iii) When MR is less than AR, AR DECREASES. | |
| 4908. |
The following table gives the daily income of ten workers in a factory. Find the arithmetic mean. {:("Workers",A,B,C,D,E,F,G,H,I,J),("Daily Income(in Rs.)",120,150,180,200,250,300,220,350,370,260):} |
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Answer» Solution : `{:("Workers",,"Daily INCOME (in Rs.)"),(,,""(X)),(""A,,""120),(""B,,""150),(""C,,""180),(""D,,""200),(""E,,""250),(""F,,""300),(""G,,""220),(""H,,""350),(""I,,""370),(""J,,""260),(,,""sumX="2,400"):}` `barX=(sumX)/N=(X_(1)+X_(2)+...X_(10))/10` `=(2,400)/10=240` `:. "Arithmetic mean "Rs. 240.` |
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| 4909. |
What are time series graphs? Or What are arithmetic-line graphs ? |
| Answer» Solution :A graph showing arithmetic values of a VARIABLE (on a graph paper) is called arithmetic line-graph. OFTEN such graphs are constructed to present time series data, that is, the data (LIKE the value of EXPORTS or IMPORTS) corresponding to different weeks, months or years. Therefore, arithmetic line-graphs are often called 'time series graphs'. | |
| 4910. |
Starting from initial market equilibrium, leftward shift in demand will result in |
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Answer» FALL in PRICE only |
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| 4911. |
Excess supply leads to fall in equilibrium price. |
| Answer» Solution :Excess SUPPLY LEADS to fall in market PRICE and not equilibrium price. During excess supply, market price is more than equilibrium price and in ORDER to sell the excess stock, market price CONTINUES to fall till equilibrium price is achieved. | |
| 4912. |
What is 'decrease' in supply? |
| Answer» SOLUTION :Decrease in supply REFERS to a fall in the supply of a commodity caused DUE to any FACTOR other than theprice of the owncommodity. | |
| 4913. |
When price of a good rises by 20%, the supply by a firm rises by 50 % . Find out Es. |
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Answer» |
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| 4914. |
What is price relative ? |
| Answer» Solution :A PRICE relative is the PERCENTAGE ratio of the VALUE of a variable in the current YEAR to its value in the base year. | |
| 4915. |
Calculate AC, AVC and the amount of profit that the firm will earn, if it sells the entire output at ₹ 60 per unit. |
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| 4916. |
Law of Supply does not indicate the magnitude of change in quantity supplied of a commodity due to change in its price |
| Answer» Solution :True. Law of SUPPLY is a QUALITATIVE STATEMENT. It INDICATES the DIRECTION of change in quantity supplied and not the magnitude of change. | |
| 4917. |
State the law of supply |
| Answer» SOLUTION :Law of supply states that there EXISTS a direct relationship between price and quantity SUPPLIED, KEEPING other FACTORS constant (ceteris paribus). | |
| 4918. |
What is the behaviour of (a) Average fixed cost and (b) Average variable cost as more and more units of a good are produced? |
| Answer» Solution :Average fixed cost is fixed cost PER unit of output. As the TOTAL number of units of the good PRODUCED increases, the average fixed cost decreases because the same amount of fixed costs is being spread over a larger number of units of output.As output rises, the AVC first falls, reaches a minimum level and then begins to rise. Thus, AVC CURVE has a U-shape | |
| 4919. |
Whichof thefollowingmeasure ofprices elasticity shows elasticsupply ? (Choose thecorrectalternative ) |
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Answer» 0 |
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| 4920. |
Describe the various methods of sampling. How is random sampling better than systematic sampling ? |
| Answer» Solution :Random Sampling- A method of sampling in which each and every item of the universehas equal chance of being selected in the sample iscalled as random sampling. In case of systematic sampling, the data is arranged numerically, ALPHABETICALLY etc. From the arranged items, every NTH item is selected as sample item. For ex, every 100 out of 1000 COMPUTERS are to be selected as a sample. The computers will be numbered and systematically arranged. Now if we selected 100 as a first number, the numbers after that will be LIKE this..200,300,400,500 etc. Thus Systematic sampling is a short cut method of random sampling. | |
| 4921. |
What is the line of best fit ? |
| Answer» SOLUTION :Line of best FIT is the one that passes through the scattered points such that it represents most of these points.Roughly, half of the scattered points should be on EITHER side of the line . | |
| 4922. |
When demand for one good falls due to rise in pride of the other good, the two goods are likely to be: |
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Answer» Complements |
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| 4923. |
For a non-viable industry, where does the supply curve lie in relation to demand curve? |
| Answer» SOLUTION :SUPPLY CURVE LIES above the DEMAND curve. | |
| 4924. |
How does an increase in the income affect the equilibrium price of a product? |
| Answer» Solution :EQUILIBRIUM price will increase in case of NORMAL goods, WHEREAS, equilibrium price will fall in case of inferior goods. | |
| 4925. |
There is a new produc launched by a mobile manufacturing unit. Consumers like this brand very much. How will it affect the demand curve of this new product? |
Answer» SOLUTION :Here the demand of this product is being affected by TASTES and PREFERENCE. Since consumers are liking it, favourable shift in tastes will cause demand to rise and the demand to rise and the demand curve will shift to its right DD-`D_(1)D_(1)`.  The curve SHIFTS to right due to favourable shift in tastes and preferences. |
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| 4926. |
Draw the following schedules and mention the coefficient of price elasticity of supply |
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| 4927. |
P_(01)=(sump_(1)q_(0))/(sump_(0)q_(0))xx100 is the formula of: |
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Answer» Laspeyre'sMethod |
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| 4928. |
State and discuss four characteristics of perfect competition |
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Answer» Solution :(1) Large number of buyers and sellers, The number of buyers and sellers is so large that an individual seller or buyer has insignificant share of total output sold or purchased. (2) HOMOGENEOUS products: The buyers treat the products of all the firms in the industry as identical/homogeneous. (3) Perfect knowledge: All producers and consumers are fully informed about the market. (4) Freedom of ENTRY and exit: There are no barriers in the way of NEW firms joining the industry and EXISTING firms leaving the industry. |
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| 4929. |
What happens to AP, when MP is more than AP ? |
| Answer» Answer :A | |
| 4931. |
Draw Average Variable Cost (AVC), Average Total Cost (ATC) and Marginal Cost (MC) curves in a single diagram. State the relation between MC curve and AVC and ATC curves. |
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Answer» Solution :(i) MC CURVES intersects ATC and AVC curves at their minimum points. (II) Vertical distance between ATC curve and AVC curve goes on DECLINING as output increases. (ii) Vertical distance between ATC curve and AVC curve goes on declining as output increases. Relationship AMONG MC, AVC & AC: When `MC lt ATC " or " AVC, ATC " or " AVC` falls, `MC = ATC " or " AVC, ATC " or " AVC` constant `MC gt ATC " or : AVC, ATC " or " AVC` rises. 
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| 4932. |
What is a table? |
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| 4933. |
AFC curve is a rectangular hyperbola curve. |
| Answer» Solution :True. Since TFC remains unchanged/constant. As output increases and TFC remains fixed , AFC declines continuously. As the same VOLUME of fixed cost is divided is dividedby the - LARGER volume of output, AFC must decline .Further, the AFC CURVE is a rectangular hyperbola in the sense that all RECTANGLES formed by AFC are of equal sizes. | |
| 4934. |
If there are two demand curve intersecting each other, which demand curve has greater ealstictly of demand ? Explain. |
Answer» Solution :When two demand curve intersect each other, the flatter demand curve exhibits greater ELASTICITY of demand than the steeper one. Flatter demand curve shows that response of demand to change in PRICE is more on it as compared to the steeper demand curve. For example There are two demand cruves DD and `D_(1)D_(1)` which interset at POINT E, the qty. demand is same as OQ on both the demand curves. Due to fall in price, Qty. dmeanded changes . it is clear that response of demand to a change in price of the good is more on `D_(1)D_(1)` as compared to DD. Since `OQ_(2) gtOQ_(1)` We can say that flatter demand curve shows greater elasticity. 
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| 4935. |
What is the relation between good x and y in each case , if with the rise in price of x demand for good y (i) rises and(ii) falls ?Given reason. |
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Answer» SOLUTION :(i)Goodsx and y aresubstitutes . It is because when priceof X rises , y becomes relatively cheaper in relation to y. The consumer buys more of by reducing DEMAND for x. (ii) Goodsx andy arecomplementary GOODS . It because x andy areused jointly .When with the rise inprice of GOOD x , demand forx falls, demand fory alsofalls. |
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| 4936. |
The time period in which production can be increased by increasing the quantity of variable factor only |
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Answer» very SHORT period |
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| 4937. |
Which of the following illustrates a decrease in the unemployment using the PPC? |
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Answer» A movement down ALONG the PPC |
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| 4938. |
Equilibrium price falls and equilibrium quantity rises when: |
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Answer» DECREASE in DEMAND `LT` Decrease in supply |
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| 4939. |
As per Ordinal Approach |
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Answer» Measurement of UTILITY is not possible through money |
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| 4940. |
Mr Raman works as production manager at a salary of Rs. 80,000 per month in company A. He got a job offer company B at a salary of Rs 90,000 per month and another job offer from company C at a salary of Rs. 95000 per month. What is his opportunity cost of working as production manager in company A. |
| Answer» Solution :In the above example, the NEXT best use of Raman's services is in COMPANY C which has given him an offer of Rs. 95000 per month. THEREFORE, opportunity COST of Mr. Raman for working as production manager in company A is Rs. 95000. | |
| 4941. |
Following are the marks obtained by 25 students in economics. Find out the mean marks by using Direct and Short-cut Method. {:("Marks",10,20,30,40,50,60),("Number of Students",5,2,3,8,4,3):} |
Answer» Solution :Direct Method:  `barX=(sum FX)/(sum f)` `barX=(880)/25=35.2` Mean Marks of 25 Students inEconomics = 35.2. Short-cut Method:  `barX=A+(sumfd)/(sumf)` `=40+(-120)/25=40-(120)/25` `=40-4.8=35.2` Thus, Mean Marks= 35.2. |
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| 4942. |
Explain the main parts of a table |
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| 4943. |
Freedom of entry and exists is possible in the: |
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Answer» SHORT run |
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| 4944. |
What is viable industry? |
| Answer» SOLUTION :It refers to an industry for which demand curve and supply curve of the PRODUCT INTERSECT each other against a positive QUANTITY. | |
| 4945. |
What change in TR will result in (i) a decreases in MR.(ii) An increase in MR ? |
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Answer» Solution :(i) TR should INCREASE at a DECREASING rate or should BECOME negative. (ii) TR should increase at an INCREASING rate. |
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| 4946. |
Under perfect competition, the firms earns normal profit in the long run because of: |
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Answer» LARGE number of buyers and SELLERS, |
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| 4947. |
What is monopoly ? Briefly explain the nature of deamand curve facing a monopolist. |
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| 4948. |
Median is that value of divides thegroup into two _________ Parts. |
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| 4949. |
The price elasticity of demand of good X is half the price elasticity of demand of good Y. A 25% rise in the price of good Y reduces its demand from 400 units to 300 units.Calculate percentage rise in demand of good X when its price falls from ₹ 10 to ₹ 8 per unit. |
Answer»  Percentage Change in Demand = `(DeltaQ)/Qxx 100 = (-100)/ 400 xx 100 =-25% ` PRICEELASTICITY of Demand`(E_(d)) = ("Percentage Change in Quantity Demanded")/("Percentage Change in price ")=(-25%)/(25%)` Price Elasticity of Demand `(E_(d))= (-)1` Now,price Elasticity of Good X= (-) 0.5 (as elasticity of demand of good X is half the price elasticirty of demand of Good Y) . Lot us now calculate % rise in Demand for X percentage change in price = `(DeltaP)/P xx100 = (-2)/10 xx100= -20% ` `(-)0.5= ("Percentage Change in Quantity Demanded")/(-20)`  Percentage change in Price `=(DeltaP)/(P)xx100=(-2)/(10)xx100=-20%` `(-)0.5 = ("Percentage Change in Quantity Demanded")/(-20)` Percentage rise in demand for X = 10% Demand for Good X will rise by = 10% |
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| 4950. |
Give two examples of macroeconomic studies. |
| Answer» SOLUTION :(i)National income, (II) Price LEVEL | |