Which one of the following bundles of goods cannot be produced with the resources the economy currently has?

1

(a)

A

(b)

B

(c)

C

(d)

D

Which one of the following statements is a reason for the negative slope of PPF?

1

(a)

The inverse relationship between the use of technology and the use of natural resources

(b)

Scarcity at any point of time due to limited amounts of productive resources.

(c)

Resource specialisation.

(d)

Increasing opportunity costs.

Which of the following is not a subject matter of microeconomics?

1

(a)

Consumer's behavior

(b)

Market structure

(c)

Monetary Policy

(d)

Pricing of factor services

Which of the shaded area in the diagrams below represent total utility?

1

(a)

(b)

(c)

(d)

What does the area under the marginal utility curve depict?

1

(a)

Average Utility

(b)

Total Utility

(c)

Indifference Curve

(d)

Consumer Equilibrium

The second glass of lemonade gives lesser satisfaction to a thirsty boy. This is a clear case of

1

(a)

Law of demand

(b)

Law of diminishing returns.

(c)

Law of diminishing

(d)

Law of supply

The consumer is in equilibrium when the following condition is satisfied

1

(a)

\(\frac { M{ U }_{ x } }{ M{ U }_{ y } } >\frac { { P }_{ x } }{ { P }_{ y } } \)

(b)

\(\frac { M{ U }_{ x } }{ M{ U }_{ y } } >\frac { { P }_{ x } }{ { P }_{ y } } \)

(c)

\(\frac { M{ U }_{ x } }{ M{ U }_{ y } } =\frac { { P }_{ x } }{ { P }_{ y } } \)

(d)

None of these

If indifference curve is straight line downward sloping,

1

(a)

MRS is increasing

(b)

MRS is decreasing

(c)

MRS is constant

(d)

MRS is zero

If regardless of changes in its price, the quantity demanded of a good remains unchanged, then the demand curve for the good will be:

1

(a)

horizontal.

(b)

vertical.

(c)

positively sloped.

(d)

negatively sloped

Suppose the price of Pepsi increases, we will expect the demand curve of Coca-Cola to:

1

(a)

shift towards left

(b)

shift towards right

(c)

initially shift towards left and then to right.

(d)

remains at the same level.

All of the following items are determinants of demand except:

1

(a)

tastes and preferences.

(b)

quantity supplied.

(c)

income.

(d)

price of related goods

The price of tomatoes increases and people buy tomato puree. You infer that tomato puree and tomatoes are:

1

(a)

normal goods

(b)

complements

(c)

substitutes

(d)

inferior goods

With a fall in the price of a commodity:

1

(a)

consumer's real income increases

(b)

consumer's real income decreases

(c)

there is no change in the real income of the consumer

(d)

None of these.

In case of a straight line demand curve meeting the two axes, the price elasticity of demand at the midpoint of the line would be:

1

(a)

0

(b)

1

(c)

1.5

(d)

2

Identify the factor which generally keeps the price elasticity of demand for a good low

1

(a)

Variety of uses for that good

(b)

Its low price

(c)

Close substitutes for that good

(d)

High proportion of the consumer's income spent on it 

The price elasticity of demand for hamburger is

1

(a)

the change in the quantity demanded of hamburger when the hamburger increases by 30 paise per rupee

(b)

the percentage increase in the quantity demanded of hamburger when the price of hamburger falls by 1 percent per rupee.

(c)

the increase in the demand for hamburger when the price of hamburger falls by 10 percent per rupee.

(d)

the decrease in the quantity demanded of hamburger when the price of hamburger falls.by 1 percent per rupee

The price elasticity of demand is defined as the responsiveness of:

1

(a)

price to a change in quantity demanded.

(b)

quantity demanded to a change in price

(c)

price to a change in income.

(d)

quantity demanded to a change in income

Diminishing marginal returns implies:

1

(a)

Decreasing average variable costs.

(b)

Decreasing marginal costs.

(c)

Increasing marginal costs.

(d)

Decreasing average fixed costs.

The short run, as economists use the phrase, is characterized by:

1

(a)

At least one fixed factor of production and firms neither leaving nor entering the industry.

(b)

A period where the law of diminishing returns does not hold.

(c)

No variable inputs-that is all the factors of production are fixed.

(d)

All inputs being variable.

To economists, the main difference between short run and long run is that:

1

(a)

In short run all inputs are fixed, while in long run all inputs are variable.

(b)

In short run the firm varies all of its inputs to find the least cost combination of inputs.

(c)

In short run, at least one of the firm's input level is fixed.

(d)

In long run, the firm is making a constrained decision about how to use existing plant and equipment efficiently.

The change in the total product resulting from a change in a variable input is:

1

(a)

Average cost

(b)

Average product

(c)

Marginal cost

(d)

Marginal product

Diminishing marginal returns for the first four units of a variable input is exhibited by the total product sequence:

1

(a)

50, 50, 50, 50

(b)

50, 110, 180, 260

(c)

50, 100, 150, 200

(d)

50, 90, 120, 140

Total cost in the short run is classified into fixed costs and variable costs. Which one of the following is a variable cost?

1

(a)

Cost of raw materials.

(b)

Cost of equipment.

(c)

Interest payment on past borrowings.

(d)

Payment of rent on building.

In the short run, when the output of a firm increases, its average fixed cost:

1

(a)

increases.

(b)

decreases.

(c)

remains constant.

(d)

first declines and then rises.

Which one of the following statements is an example of an "implicit cost"?

1

(a)

Interest that could have been earned on retained earnings used by the firm to finance expansion.

(b)

The payment of rent by the firm for the building in which it is housed.

(c)

The interest payment made by the firm for funds borrowed from a bank.

(d)

The payment of wages by the firm.

A firm's average fixed cost is Rs. 20 at 6 units of output. What will it be at 4 units of output?

1

(a)

Rs. 60

(b)

Rs. 30

(c)

Rs. 40

(d)

Rs. 20

A vertical supply curve parallel to Y-axis implies that the elasticity of supply is:

1

(a)

Zero

(b)

Infinity

(c)

Equal to one

(d)

Greater than zero but less than infinity.

The quantity supplied of a piece of goods or service is the amount that

1

(a)

is actually bought during a given time period at a given price

(b)

producers wish that they could sell that at a higher price

(c)

producers plan to sell during a given time period at a given price.

(d)

people are willing to buy during a given time period at a given price

If the quantity supplied is exactly equal to the relative change in price then the elasticity of supply is   

1

(a)

less than one

(b)

greater than one

(c)

one

(d)

none of them

Assume that when price is Rs 20, the quantity demanded is 9 units, and when price is Rs19 the quantity demanded is 10 units. Based on this information what is the marginal revenue resulting from an increase in output from 9 units to 10 units.

1

(a)

Rs 20

(b)

Rs 19

(c)

Rs 10

(d)

Rs 1

Assume that when price is Rs 20, the quantity demanded is 15 units and when price is ns, the quantity demanded is 16 units. Based on this information what is the marginal revenue resulting from an increase in output from 15 units to 16 units?

1

(a)

Rs 18

(b)

Rs 16

(c)

Rs 12

(d)

Rs 28

Marginal Revenue is equal to:

1

(a)

The change in price divided by the change in output.

(b)

The change in quantity divided by the change in price.

(c)

The change in P x Q due to a one unit change in output.

(d)

Price, but only if the firm is a price searcher.

Total revenue =

1

(a)

Price x quantity

(b)

Price x income

(c)

Income x quantity

(d)

None of these.

When price remains constant at all level of output, total revenue______.

1

(a)

increases at increasing rate

(b)

increases at diminishing rate

(c)

increases at constant rate

(d)

None of these.

If MC is more than MR at a particular level of output, how will the producer react to maximize the profits________________

1

(a)

Decrease Production

(b)

Increase Production

(c)

Increase Revenue

(d)

None of these

When MC is equal to MR, while maximizing profit, then

1

(a)

MC must be rising

(b)

MC must be falling

(c)

MC must be constant

(d)

None of these

What is the relation between price and marginal cost at equilibrium, when price falls with the rise in output.

1

(a)

Price = Marginal Cost

(b)

Price> Marginal Cost

(c)

Price < Marginal cost

(d)

None of these

What is the relation between price and marginal cost at equilibrium, when price remains constant with the rise in output.

1

(a)

Price = Marginal Cost

(b)

Price> Marginal Cost

(c)

Price < Marginal cost

(d)

None of these

What is the shape of the demand curve faced by a firm under perfect competition?

1

(a)

Horizontal

(b)

Vertical

(c)

Positively sloped

(d)

Negatively sloped

For a price-taking firm

1

(a)

marginal revenue is less than price

(b)

marginal revenue is equal to price

(c)

marginal revenue is greater than price

(d)

the relationship between marginal revenue and price is indeterminate

The firm in a perfectly competitive market is a price taker. This designation as a price taker is based on the assumption that______________.

1

(a)

the firm has some, but not complete, control over its product price

(b)

there are so many buyers and sellers in the market that any individual firm cannot affect the market

(c)

each firm produces a homogeneous product

(d)

there is easy entry into or exit from the market place

Suppose that a sole proprietorship is earning total revenues of  Rs.1,00,000 and is incurring explicit costs of Rs.75,000. If the owner could work for another company for Rs.30,000 a year, we would conclude that__________________.

1

(a)

the firm is incurring an economic loss.

(b)

implicit costs are Rs.25,000

(c)

the total economic costs are Rs.1,00,000

(d)

the individual is earning an economic profit of Rs.25,000

A purely competitive firm's supply schedule in the short run is determined by_____________.

1

(a)

its average revenue.

(b)

its marginal revenue.

(c)

its marginal utility for money curve

(d)

its marginal cost curve

Oligopolistic industries are characterized by_________

1

(a)

A few dominant firms and substantial barriers to entry

(b)

A few large firms and no entry barriers.

(c)

A large number of small firms and no entry barriers.

(d)

One dominant firm and low entry barriers.

In which form of the market structure is the degree of control over the price of its product by a firm very large?

1

(a)

Monopoly

(b)

Imperfect Competition

(c)

Oligopoly

(d)

Perfect competition

A seller cannot influence the market price under :

1

(a)

perfect competition

(b)

Monopoly

(c)

monopolistic competition

(d)

All of the above

Average revenue and price are always equal under:

1

(a)

perfect competition only

(b)

Monopolistic competition only

(c)

monopoly only

(d)

all market forms

If price is above then equilibrium Price, there is:

1

(a)

excess demand

(b)

excess supply

(c)

price ceiling

(d)

price flooring

With a given supply curve a decrease in demand causes

1

(a)

an overall decrease in price but an increase in equilibrium quantity

(b)

an overall increase in price but a decrease in equilibrium quantity.

(c)

an overall decrease in price and a decrease in equilibrium quantity

(d)

no change in overall price but a reduction in equilibrium quantity

Assume that consumers' incomes and the number of sellers in the market for goods A both decrease. Based upon this information, we can conclude, with certainty, that the equilibrium   

1

(a)

price will increase

(b)

price will decrease.

(c)

quantity will increase

(d)

quantity will decrease.

Suppose that the supply of cameras increases due to an increase in imports. Which of the following statements will most likely occur?

1

(a)

The equilibrium price of cameras will increase

(b)

The equilibrium quantity of cameras exchanged will decrease.

(c)

The equilibrium price of camera film will decrease.

(d)

The equilibrium quantity of camera film exchanged will increase.

Suppose the technology for producing personal computers improves and, at the same time, individuals discover new uses for personal computers so that there is greater utilisation of personal computers. Which of the following statements /factors will happen to equilibrium price and equilibrium quantity?

1

(a)

Price will increase ; quantity cannot be determined.

(b)

Price will decrease; quantity cannot be determined.

(c)

Quantity will increase; price cannot be determined

(d)

Quantity will decrease; price cannot be determined.

Which definition was given by Adam Smith?

1

(a)

Welfare Definition

(b)

Scarcity Definition

(c)

Wealth Definition

(d)

Growth Oriented Definition

What implication(s) does resource scarcity has for the satisfaction of wants?

1

(a)

Not all wants can be satisfied

(b)

The discovery of new natural resources is necessary to increase our ability to satisfy wants.

(c)

We will never be faced with the need to make choices

(d)

We must develop ways to decrease our individual wants.

What is the root cause of all economic problems?

1

(a)

Scarcity

(b)

Excess Demand

(c)

Excess Supply

(d)

Deficient Demand

The law of scarcity:

1

(a)

does not apply to rich, developed countries

(b)

implies that consumer's wants will never be completely satisfied

(c)

applies only to the less developed countries

(d)

implies that consumer's wants will be satisfied in a socialistic system

The proper use of statistics can be made by

1

(a)

Cheats

(b)

Everyone

(c)

Common Man

(d)

Experts

Distrust of Statistics is due to:

1

(a)

Misuse of Statistics

(b)

Insufficient Statistical Methods

(c)

Lack of Scope of Statistics

(d)

Limitations of Statistics

Which of the following statement is true?

1

(a)

Statistics deals with all kinds of data

(b)

Statistics can be used by one and all.

(c)

It is very difficult to misuse statistics

(d)

Statistics can mould data to make god or devil from it.

In random sampling:

1

(a)

Sample is always full of bias

(b)

Each element has equal chance of being selected

(c)

Cost involved is very less

(d)

Cost involved is high

Data collected from a newspaper is an example of:

1

(a)

Sample data

(b)

Primary data

(c)

Secondary data

(d)

either (a) or (c)

Data collected on religion from the census reports are:

1

(a)

Sample data

(b)

Primary data

(c)

Either (a) or (b)

(d)

Secondary data

A good questionnaire should have questions which are:

1

(a)

Not personal

(b)

Well ordered

(c)

Logical

(d)

All the above

Direct personal investigation method suffers from:

1

(a)

Time consuming

(b)

Excessive expenses

(c)

Personal bias

(d)

All the above

Given below is a statistical series.

Marks	Below 10	10-20	20-30	30 and above
Frequency	3	4	6	2

It is an example of:

1

(a)

Continuous series

(b)

Open ended Series

(c)

Exclusive series

(d)

All of the above

Annual income of a person is:

1

(a)

A continuous variable

(b)

A discrete variable

(c)

An attribute

(d)

(c) and (a)

In an ordered series, the data are:

1

(a)

In descending order

(b)

In ascending order

(c)

Either (a) or (b)

(d)

None of these

A grouped frequency distribution with uncertain first or last class is known as:

1

(a)

Open ended distribution

(b)

Discrete distribution

(c)

Exclusive class distribution

(d)

Inclusive class distribution

The most accurate mode of data presentation is:

1

(a)

Diagrammatic method

(b)

Tabulation

(c)

Textual presentation

(d)

None of these

Which of the following statements is not true for tabulation?

1

(a)

Facilitates comparison between rows and not columns.

(b)

Statistical analysis of data requires tabulation

(c)

Diagrammatic representation of data requires tabulation

(d)

Complicated data can be presented

The most attractive method of data presentation is:

1

(a)

Tabular

(b)

diagrammatic

(c)

Textual

(d)

either (a) or (c)

Square is a:

1

(a)

One-dimensional diagram

(b)

two-dimensional diagram

(c)

Diagram with no dimension

(d)

none of the above

Percentage Bar diagram is

1

(a)

Same as Sub divided Bar Diagram

(b)

Has all bars equal in size

(c)

is similar to multiple bar diagram

(d)

All of the above

Mode is found graphically by:

1

(a)

Frequency polygon

(b)

Ogive

(c)

Histogram

(d)

None of these

If you are interested in how the government expenditure have fluctuated over time, it would be best to use:

1

(a)

Pie graph

(b)

Histogram

(c)

Time series graphe

(d)

Frequency Curves

The mean of 12 numbers is 24 .if 5 is added in every number, the new mean

1

(a)

29

(b)

84

(c)

25

(d)

None of these

Measures of central tendency are known as:

1

(a)

Difference

(b)

Average

(c)

Both 

(d)

None of these

Which of the following is affected by extreme values?

1

(a)

Median

(b)

Index number

(c)

Mean

(d)

Mode

When different items have different importance we should use:

1

(a)

Unweighted average

(b)

Index number

(c)

Weighted Mean

(d)

Mode

Median can be calculated from series:

1

(a)

Individual

(b)

Discrete

(c)

Continuous

(d)

All of Above

Most frequent occurring value in a series is called:

1

(a)

Mode

(b)

Median

(c)

Mean

(d)

Quartiles

If mean of a series is 32 and median is 40, what would be the value of mode?

1

(a)

38

(b)

58

(c)

56

(d)

54

What do you call the partition value which divides the series into two equal parts?

1

(a)

Upper quartile

(b)

Lower quartile

(c)

Mode

(d)

Median

The second quartile is known as:

1

(a)

Upper quartile

(b)

Lower quartile

(c)

Median

(d)

None of these

Median:

1

(a)

Cannot be determined

(b)

Affected by extreme items

(c)

Can be determined graphically

(d)

Involves complex calculations

The square of standard deviation is known as:

1

(a)

Mean deviation

(b)

Variance

(c)

Standard deviation

(d)

Quartile deviation

The measure of variation which is mostly affected by extreme items is:

1

(a)

Range

(b)

Quartile deviation

(c)

Mean deviation

(d)

Standard deviation

Which measures of dispersion is the quickest to compute?

1

(a)

Mean deviation

(b)

Quartile deviation

(c)

Range

(d)

Standard deviation

Which measure of dispersion which ignores signs of the deviations from a central value is:

1

(a)

Standard deviation

(b)

Quartile deviation

(c)

Mean deviation

(d)

Range

The standard deviation of 25 numbers is 0. If each of the numbers is increased by 5, then the new standard deviation will be:

1

(a)

45

(b)

40

(c)

41.5

(d)

55

The unit of correlation coefficient between height in feet and weight in kg is

1

(a)

Kg/Feet

(b)

Percentage

(c)

Non existent

If all the plotted points in a scatter diagram lie on a single line, then the correlation is:

1

(a)

Perfect positive

(b)

Perfect negative

(c)

Either (a) or (b)

(d)

Both (a) and (b)

A scatter diagram:

1

(a)

Is a statistical test

(b)

Must be linear

(c)

Must be curvilinear

(d)

Is a graph of x and y values

A consumer price index measures changes in:

1

(a)

Wholesale Price

(b)

Consumer Price

(c)

Producer's Price

Price-relative is expressed in terms of:

1

(a)

\(p=\frac { { p }_{ n } }{ { p }_{ 0 } } \)

(b)

\(p=\frac { { p }_{ 0 } }{ { p }_{ } } \)

(c)

\(p=\frac { { p }_{ n } }{ { p }_{ 0 } } \times 100\)

(d)

\(p=\frac { { p }_{ n } }{ { p }_{ 0 } } \times 100\)

Fisher's Ideal Index number is expressed in terms of:

1

(a)

(P_on)^F = √ Laspeyer's Index \(\times \) (Paasche's Index)

(b)

(P_on)^F = Laspeyer's Index \(\times \) 'Paasche's Index'

(c)

(P_on)^F = √Marshall Edge worth Index \(\times \) Paasche's

(d)

None of these

A consumer price index measures changes in:

1

(a)

retail prices

(b)

wholesale prices

(c)

producers prices

(d)

UnAvailable Option

Historically the first index number is constructed in the year ______.

1

(a)

1764

(b)

1776

(c)

1881

(d)

1921

Which of the following is a tool for presentation of data?

1

(a)

Bar Diagram

(b)

Pie Chart

(c)

Time Series Graph

(d)

All of the above.

'Limitation of study' mentions:

1

(a)

Sample Size

(b)

Assumptions

(c)

Methodological limitations

(d)

All of the above