CBSE Questions for Class 11 Commerce Economics The Theory Of The Firm Under Perfect Competition Quiz 9 - MCQExams.com

Select the incorrect one/ ones out of the following statements related with the idea 'x-inefficiency':
The concept suggests that firms operate at higher costs than their minimum attainable costs.
Large companies usually do not face this crisis due to effective environment of competition in which they operate.
  • Only $$1$$
  • Only $$2$$
  • $$1$$ and $$2$$
  • None of the above
Opportunity cost occurs because of a producers need to
  • limit resources
  • protect resources
  • allocate resources
  • spend resources
Select the correct option: What is the implication of a vertical supply curve?
  • Perfectly inelastic supply
  • Perfectly elastic supply
  • Relatively inelastic supply
  • Unitary elastic supply
In the long period, supply for the commodity is: 
  • Perfectly inelastic
  • Less elastic
  • Highly elastic
  • Perfectly elastic
An entrance examination has $$200$$ questions in total. Each correct answer gives $$1$$ mark with a negative mark of $$1/4$$ for each incorrect answer. What is the opportunity cost of $$30$$ incorrect questions?
  • $$7.5$$
  • $$30$$
  • $$37.5$$
  • Can't be determined
Opportunity cost refers to which of the following? 
  • Accounting cost minus the marginal benefit.
  • Monetary costs of an activity.
  • Highest valued alternative forgone.
  • Accounting cost minus the marginal cost.
Suppose that you have to decide between seeing a movie and going to see a cricket match on a particular Saturday evening. You are willing to pay $$Rs. 500$$ to see the movie. You are willing to pay $$Rs. 1,500$$ for the cricket match. The opportunity cost of going to the movie is _____.
  • $$Rs. 1,000$$
  • $$Rs. 500$$
  • $$Rs. 1,500$$
  • None of these
The responsiveness of the sellers to a particular change in the price of the commodity is termed as ___________. 
  • elasticity of supply
  • theory of demand
  • theory of supply
  • none of the above
The concept of elasticity of supply is a parallel concept to the concept of __________.
  • theory of demand
  • theory of supply
  • elasticity of demand
  • none of the above
The elasticity of supply is _________ when the change in the amount of supply is in exact proportion to the change in price.
  • perfectly elastic
  • perfectly inelastic
  • unitary
  • less elastic
In perfect competition, when price is less than minimum AVC in the short run, the firm produces __________.
  • output level where AVC intersects SMC
  • zero output
  • both A and B
  • none of the above
If a dealer is prepared to supply 1000 sets of a 29" Colour TV if the price is Rs. 12,000 per set, however if the price rises to Rs. 15,000 he is prepared to supply 1,500 pieces. The elasticity of supply of the TV set is _______.
  • 1
  • 2
  • 0.75
  • 1.4
A supply curve passing through any point on X axis (quantity) will have elasticity __________.
  • less than 1
  • more than 1
  • just one
  • zero
Which of the following is/are correct regarding the shape of total revenue under perfect competition?
(i) TR curve is the straight line from the origin.
(ii) Its slopes is constant
(iii) TR curve is S-shaped
(iv) Its slopes change with the change in output
  • (i) and (ii) only
  • (iii) and (iv) only
  • (i) and (iii) only
  • (ii) and (iv) only
Under which of the following market structures is the price lower and output larger?
  • Perfect Competition.
  • Monopolistic Competition.
  • Monopoly.
  • Oligopoly.
In perfect competition, since the firm is a price taker; the ________ curve is straight line.
  • marginal cost
  • total cost
  • total revenue
  • marginal revenue
The distinction between a single firm & an Industry vanishes in which of the following market condition.
  • Monopoly.
  • Perfect competition.
  • Monopolistic competition.
  • Imperfect competition.
Along the long run supply curve, all of the following can be varied except ____________.
  • level of output
  • level of capital
  • level of labour
  • all the three
A 6% increase in price has caused 8% increase in quantity supplied, the price elasticity of supply will be _________.
  • 1.33
  • -1.33
  • 0.66
  • -0.66
As in perfect Competition, the Firms operating in a monopolistically competitive industry can realize only Normal Profits in the long run because.
  • The Firms tend to have diseconomies of scale in the long run.
  • There are virtually no entry or exit barriers.
  • Consumers are more price sensitive in the long ruin thar in the short run.
  • Cartels agreements tend to be more unstable with the increase of time as member Firms try to increase their profits by cheating on the agreement.
A firm will shut-down its operation if its _____________.
  • revenue is just equal to variable cost and the loss is equal to fixed costs.
  • earning covers variable costs as well as part of the fixed costs.
  • average revenue falls below average variable cost.
  • firms, in the short-run never shut down their operation.
A 6% decrease in price has caused 9% decrease in quantity supplied, the price elasticity of supply will be _________.
  • 1.33
  • -1.33
  • 1.5
  • -0.66
In India, the Milk Market resembles a perfectly competitive industry. If the industry is an increasing cost industry, the long run supply curve of the industry _________.
  • Slopes upward to the right.
  • Slopes downward to the right.
  • Would be a vertical straight line.
  • Would be horizontal straight line.
If quantity supply changes substantially in response to small changes in price of the good then it is
  • Relatively greater elastic supply
  • Relatively less elastic supply
  • Unitary elastic
  • Perfect elastic
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180.00100.0020
240.0058.0017
326.6644.0015
420.0036.2513
516.0031.4012
613.3328.3313
711.4226.2914
810.0026.1325
98.8826.5630
108.0027.5634
117.2728.3040
126.6630.0047
136.1531.9255
If price is Rs. 26, perfectly competitive firm will:
  • Shut down in the short run.
  • Produce 8 units at a total economic loss of Rs. 9.
  • Produce 9 units at a total economic loss of Rs. 5.
  • Produce 8 units at a total economic loss of Rs. 1.04.
When production equals 7 units,the firm's profit is :
  • Rs. 0
  • Rs. 41.57
  • Rs. 291
  • Rs. 336
Under perfect competition, when market price line passes through some point between the minimum of AC and AVC, it is called _________.
  • breakeven point
  • shut down point
  • minimising losses point
  • profit point
In the table marginal cost per unit that corresponds to 40 units of production is _________.
  • Rs. 22
  • Rs. 85
  • Rs. 176
  • Rs. 880
Under perfect competition a firm will be in equilibrium if __________.
  • MC=MR
  • MC cuts the MR from below
  • MC rises when it cuts the MR
  • all the conditions stated above are fulfilled
When production is 40 units, the average total cost is ________.
  • Rs. 48.40
  • Rs. 75.50
  • Rs. 85
  • Rs. 92.50
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