CBSE Questions for Class 11 Commerce Economics The Theory Of The Firm Under Perfect Competition Quiz 1 - MCQExams.com

Rent will be produced at that time when ________.
  • entire land is fertile
  • elasticity of supply of land is perfectly elastic
  • land is mobile
  • none of the above
The horizontal demand curve parallel to X-axis implies that the elasticity of demand is ______.
  • zero
  • infinite
  • equal to one
  • greater than zero but less than infinity
Land is the only factor of production whose supply is _____.
  • more elastic
  • perfectly elastic
  • perfectly inelastic
  • unitary elastic
Demand for factors of production is ______.
  • derived demand
  • joint demand
  • composite demand
  • none of the above
The cost of one thing in terms of the alternative given up is called ______.
  • real cost
  • production cost
  • physical cost
  • opportunity cost
The market period supply curve for perishable commodities is ________.
  • relatively inelastic
  • perfectly inelastic
  • relatively elastic
  • perfectly elastic
What minimum price is acceptable to a firm in the short-period?
  • Equal to AC
  • Equal to AVC
  • Equal to AFC
  • Equal to TC
The MR will be equal to AR in ____________.
  • monopoly
  • monopolistic competition
  • oligopoly
  • perfect competition
How many degrees are there to measure the elasticity of supply?
  • Two
  • Three
  • Four
  • Five
Supply is said to be less elastic when a big change in price brings about a big change in supply.
  • True
  • False
Supply is _________ when a change in the price causes no change in supply.
  • perfectly elastic
  • perfectly inelastic
  • unitary elastic
  • less elastic
When with a minute change or without any change in price, supply may change to any extent, then the supply is _____________.
  • perfectly elastic
  • perfectly inelastic
  • unitary elastic
  • more elastic
Which methods are used for the measurement of elasticity of supply?
  • Percentage or Proportionate Method
  • Geometric or Diagrammatic Method
  • Both A and B
  • None of these
If more producers are there in the market the _____ will increase.
  • demand
  • supply
  • price
  • quality
Which of the following factors affect the elasticity of supply of a commodity?
  • Nature of the inputs used
  • Natural constraints
  • Nature of the commodity
  • All of these
Where will the supply curve be horizontal and parallel to the x-axis?
  • Perfectly inelastic supply
  • Unitary elastic supply
  • Perfectly elastic supply
  • Less elastic supply
"Elasticity of supply is defined as the percentage change in quantity supplied divided by percentage change in price." Who provided this definition?
  • Lipsey
  • Prof. Bilas
  • McConnel
  • Thomas
Economic profit = ____________.
  • Accounting profit-Explicit costs.
  • Accounting profit-Imputed costs.
  • Accounting profit-Variable costs.
  • Accounting profit-Fixed costs.
Which of the following is not an implicit cost?
  • Salary of the proprietor
  • Return on entrepreneurs own investment
  • Return on entrepreneurs own capital
  • Wages of the employees
Explicit cost consists of ___________.
  • salaries paid to the employees.
  • wages paid to labourers
  • payments into depreciation and sinking fund accounts
  • both A and B
Opportunity cost is also known as ________________.
  • Money cost
  • Real cost
  • Displacement cost
  • Implicit cost
The concept of opportunity cost is helpful to the employer in calculating the ________________.
  • implicit costs
  • imputed costs
  • explicit cost
  • Either (A) or (B)
Opportunity cost means _______________.
  • the next best alternative sacrificed in order to obtain that commodity
  • cost related to an optimum level of production
  • variable costs
  • a bargain price for a factor of production
In imperfect market, the AR curve will be ______________.
  • sloping downward
  • sloping upward
  • horizontal line
  • vertical line
__________ are relatively less elastic in supply.
  • Both A and B
  • Durable goods
  • Perishable goods
  • None of the above
The necessary condition for perfect competition :
I. Existence of large number of buyers and sellers
II. Existence of homogeneous product
III. Existence of free entry and free exit for firms
IV. Absence of transport costs
  • I and IV are correct
  • II, III and IV are correct
  • I, II and III are correct
  • All are correct
The shut-down point for the firm is the output of lowest _________.
  • AC
  • MC
  • AVC
  • Price
Under perfect competition, there can be only one price in the market because ___________________.
  • The product sold by all firms is homogeneous
  • The product sold by all firms is hetrogeneous
  • The firm has no control over its price fixation
  • None of the above
In short run, a competitive firm can earn only _____________.
  • Normal profit
  • Supernormal profit
  • Losses
  • Any one of the above
A firm in the short period (perfect competition) may earn ______________.
  • Normal profit
  • Abnormal profit
  • Loss
  • Any one of the above
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