CBSE Questions for Class 11 Commerce Economics The Theory Of The Firm Under Perfect Competition Quiz 5 - MCQExams.com

Perfectly elastic supply means _________.
  • $${ E }_{ s }>1$$
  • $${ E }_{ s }<1$$
  • $${ E }_{ s }=\infty $$
  • $${ E }_{ s }=0$$
Unitary elasticity of supply means _________.
  • $${ E }_{ s }>1$$
  • $${ E }_{ s }<1$$
  • $${ E }_{ s }=1$$
  • $${ E }_{ s }=0$$
Under perfect competition ______.
  • MC = Price
  • MC > Price
  • MC < Price
  • none of these
The supply function is given as: Q= -100 + 10P.
Find the elasticity using point method, when price is Rs. 15.
  • 4
  • -3
  • -5
  • 3
Supply curve is?
  • Positively stopped
  • Negatively stopped
  • Can stop either positive or negative
  • None of the above
The concept of consumer's surplus is useful in _______.
  • distinguishing between Value-in-use and value-in-exchange.
  • comparing the advantages of different places.
  • useful in cost benefit analysis of projects.
  • all of the above
In the long run monopolistic competitive firms make the same type of profits as  _______________.
  • perfect competition
  • monopoly
  • oligopoly
  • none of the above
Price exceeds average variable cost but is smaller than average total cost at the optimum level of output, the firm is ______________.
  • making a profit and should continue to produce
  • incurring a loss but should continue to produce
  • incurring a loss and should stop producing immediatly
  • break even and maintain current output
Which one of the following labour resources will likely have the most inelastic supply schedule in the short run?
  • Filling station attendants
  • Sales clerks
  • Construction labourers
  • Dentist
The perfectly competitive firm's short run supply curve is same as the ___________________. 
  • total revenue
  • supply of other firms in the industry
  • upward sloping portion of its marginal cost curve at or above minimum AVC curve
  • upward sloping portion of its MR curve
Economic profit is best defined as:
  • a company's net income as indicated by its accounting statement
  • the difference between the price of a product and the monetary cost of the raw materials used to produce it
  • the price of the the resources used 
  • income paid by a business to its employers
When price of a commodity increase from Rs. 10 Rs. 12 per units, its supply goes up from 100 units to 140 units, the elasticity of supply would be _______.
  • 1
  • 2
  • 3
  • 4
In short run equilibrium of a monopolistic a plant will be shut down only if _______________.
  • loss is equal to its fixed cost
  • loss is more than its fixed cost
  • profit is more than its fixed cost
  • all of the above
There is no difference between firm and industry in the case of _______.
  • pure monopoly
  • pure oligopoly
  • duopoly
  • perfect competition
 When the greater the elasticity of supply, the change in the new equilibrium price will _____________.
  • be higher
  • be higher than previous price
  • be lower
  • be lower than previous price
In a very short period market _____________.
  • the supply is fixed
  • the demand is fixed
  • demand and supply are fixed
  • None of the above
________refers to a market structure in which a large number of firms produce identical goods and sell them at a uniform price, where firms have the freedom of entry and exit and all the buyers and sellers have full knowledge of the market conditions.
  • Monopolistic competition
  • Monopoly
  • Oligopoly
  • Perfect competition
The supply is ___________, when a small change in price causes a greater change in quantity supplied.
  • relatively more elastic
  • perfectly elastic
  • perfectly inelastic
  • relatively Inelastic
The supply is said to be __________, when any change in price produces no change in the quantity supplied of a commodity.
  • relatively more elastic
  • perfectly elastic
  • perfectly inelastic
  • relatively Inelastic
The formula for calculating price elasticity of supply is ________________.
  • $$\displaystyle E_s = \frac{percentage \,\, change \,\, in \,\, price}{percentage \,\, change\,\, in \,\, quantity\,\, demanded}$$
  • $$\displaystyle E_s = \frac{percentage \,\, change \,\, in \,\, quantity\,\, demanded }{percentage \,\, change\,\, in \,\, quantity\,\, supplied}$$
  • $$\displaystyle E_s = \frac{percentage \,\, change\,\, in \,\, quantity\,\, supplied }{percentage \,\, change\,\, in \,\, price}$$
  • $$\displaystyle E_s = \frac{ percentage \,\, change \,\, in \,\, quantity \,\, demanded }{percentage \,\, change\,\, in \,\, price}$$
Usually, the demand for commodities, the consumption of which can be postponed, has an _________ demand as the prices rise and expected to fall again.
  • elastic
  • inelastic
  • unitary
  • All of above
The supply is said to be ____________, when a very insignificant change in price leads to an infinite change in quantity supplied.
  • relatively more elastic
  • perfectly elastic
  • perfectly inelastic
  • relatively Inelastic
In a firm's average revenue is equal to its average cost, then _________________________.
  • profit is at maximum
  • profit is at miniimum
  • profit is equal to zero
  • the firm is in equilibrium
The _________ refers to the amount of a certain good producers are willing to supply when receiving a certain price.
  • quantity demanded
  • quantity purchased
  • quantity supplied
  • quantity sold
Production may continue so long as:
  • $$TR \geq TC$$
  • $$TR \geq TVC$$
  • $$TR \geq TFC$$
  • none of the above
When a firm is able to cover its variable costs only, it will be at:
  • break-even point
  • equilibrium point
  • shut-down point
  • none of the above
Which industry best fits the description of a Perfectly Competitive market?
  • Automobile.
  • PC.
  • Soft-drinks.
  • Agriculture.
In a perfect competition, seller has to incur selling expenses because his product has to be differentiated from the supplied by other sellers. 
  • True
  • False
In perfect competition in the long run there will be no ________.
  • supernormal profits
  • normal profits
  • production
  • none of above
In a perfect competition which curve among following will be a straight line?
  • Marginal revenue
  • Marginal cost
  • Average cost
  • Total cost
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