CBSE Questions for Class 11 Commerce Economics Introduction To Microeconomics Quiz 2 - MCQExams.com

Microeconomics involves the study of individual units. It thus involves the study of firms and their interactions with the market to determine pricing and demand and then allocate resources.

Microeconomics deals with partial equilibrium analysis. Hence, an important fact about microeconomics is that its study assumes the prevalence of full employment so that it does not affect the equilibrium.

Microeconomics deals with the study of individual economic units. It uses 'slicing method', i.e, it splits up the entire economy into smaller parts for the purpose of intensive study.

Any point beyond the PPF that is not attainable is called the unattainable combination. With the given amount of available resources, it is impossible for the economy to produce any combination more than the given possible combinations i.e. an economy can never operate at any point outside the PPF.  Thus this situation arises either due to lack of resources or technological constraints.

The production possibility frontier refers to the graphical representation of possible combinations of two goods that can be produced with given resources and technology. 

What to produce is an alternative problem of allocation of resources. It talks about the things that should be produced with the limited resources that are available in the economy. Thus it is important that you allocate these resources to various uses in an efficient manner. So that the maximum output can be achieved.

Positive statements study the facts of life i.e it deals with 'things as they are'. It deals with what are the economic problems and how are they actually solved. It explains the cause and effect relationship and avoids giving suggestions.

Both the statements A, C, and D are giving suggestions but B is stating a fact and it not suggesting anything. Thus option B is a positive statement. 

If a firm is operating at any point inside the PPF, the firm is an inefficient firm. The points inside the PPF represent the inefficient utilization of resources. When the actual production falls short of its capabilities or there is a wastage or under-utilization of resources, the firm operates on a point inside the curve.