CBSE Questions for Class 11 Commerce Economics Theory Of Consumer Behaviour Quiz 4 - MCQExams.com

With the increase in the consumption of units of a given commodity the marginal utility ________.
  • diminishes
  • increases
  • remain constant
  • is zero
Demand for a good is termed inelastic through the expenditure approach when if (Choose the correct alternative):
  • Price of the good falls; expenditure on it rises
  • Price of the good falls; expenditure on it falls
  • Price of the good falls; expenditure on it remains unchanged
  • Price of the good rises, expenditure on it falls
Warm clothes in winter have _______ utility.
  • time
  • place
  • form
  • service
As consumption increases, the marginal utility also increases.
  • True
  • False
The law of equi-marginal utility is introduced by _______.
  • Alfred Marshall
  • Adam Smith
  • K.E. Boulding
  • none of the above
The second can of Pepsi gives lesser satisfaction to a thirsty boy, its is a clear case of __________.
  • law of diminishing marginal utility
  • law of demand
  • law of diminishing returns
  • law of supply
When total utility declines, marginal utility is ________.
  • negative
  • zero
  • increasing
  • decreasing
Diminishing marginal utility is a universal phenomenon.
  • True
  • False
Marginal utility increases with increase in consumption 
  • True
  • False
The marginal utility curve slopes ______ from left to right.
  • forward
  • downward
  • upward
  • backward
When the price of a commodity rises the demand will fall.
  • True
  • False
The relationship between price and demand is positive. 
  • True
  • False
Pen and Ink are ________.
  • substitute goods
  • complementary goods
  • unrelated goods
  • normal goods
The rise in price is followed by rise in demand.
  • True
  • False
Quantity demanded varies directly with price.
  • True
  • False
There are no exception to the law of demand. 
  • True
  • False
Mere desire is not demand.
  • True
  • False
A consumer may demand more at the same price if his income increases. 
  • True
  • False
A relatively elastic demand curve has a steeper slope. 
  • True
  • False
Demand for specialized labour is _____. 
  • elastic
  • inelastic
  • perfectly elastic
  • perfectly inelastic
The demand for salt is ______.
  • elastic
  • inelastic
  • infinite elastic
  • unitary elastic
Demand for luxuries is elastic.
  • True
  • False
The geometric method is a more exact method of measuring elasticity of demand.
  • True
  • False
Demand for pins is ______ . 
  • elastic
  • inelastic
  • perfectly elastic
  • perfectly inelastic
Demand for composite commodities is elastic. 
  • True
  • False
Slope of budget line is equal to ________.
  • marginal rate of substitution between the factor inputs
  • ratio of price of factor input
  • demand of each factor input
  • supply of each factor input
Which of the following is not a type of elasticity in economics?
  • Income elasticity
  • Price elasticity
  • Utility elasticity
  • Cross elasticity
To measure price elasticity of demand, % change in demand is ________.
  • divided by change in price
  • divided by % change in price
  • reduced by change in price
  • reduced by % change in price
To measure price elasticity of demand, change in demand is related to ______.
  • change in supply
  • change in price in relative terms
  • change in price in absolute term
  • change in consumer tastes
If a product has no substitutes its demand ________.
  • will be highly elastic
  • will be inelastic
  • will be unity elastic
  • none of the above
Elasticity is measured in ______.
  • rupee term
  • absolute terms
  • relative terms
  • quantitative terms
The measurement of sensitivity of quantity demand to change in price is called ________.
  • price elasticity
  • income elasticity
  • expansion in demand
  • none of the above
When the price of complementary products increases, the demand of the other products will __________.
  • falls
  • increases
  • remains same
  • increases by 25%
If price of X falls leading to fall in total outlay on X, the demand of X is ______.
  • elastic
  • inelastic
  • unitary elastic
  • less than unit elastic
Elasticity is the ratio of _______ dependent variable to the relative change in independent variable.
  • relative change in a dependent variable
  • absolute change in one variable
  • absolute change in any variable
  • relative change in one fixed variable
In long run, the demand has a tendency to show ________.
  • high elasticity
  • stability
  • zero elasticity
  • fluctuation
In the short run, the demand tends to be _________.
  • highly elastic
  • less elastic
  • volatile
  • zero elastic
If the price elasticity of a product is greater than 1, we can say that ________.
  • the products demand is sensitive to price variation
  • product demand is insensitive to price variation
  • demand and price move in same directions
  • none of the above
The elasticity of a demand curve with a constant slope ________.
  • decrease at lower price
  • decrease at higher price
  • increase at lower price
  • remains constant
Luxury goods have _______ degree of elasticity.
  • high
  • low
  • moderate
  • completely inelastic
Goods which are perfect substitute of each other will have elasticity of substitution _________.
  • unity
  • less than 1
  • more than 1
  • infinite
Goods which are perfect substitute of each other will have rate of substitution __________.
  • unity
  • less than 1
  • more than 1
  • zero
Demand of salt is inelastic because _________.
  • of low price
  • no substitute
  • absence of it makes food tasteless
  • all of the above
The elasticity of a demand curve with a constant slope __________.
  • increase at higher price
  • decrease at higher price
  • increase at lower price
  • remains constant
If the disposal income of a household increases by 10% and the demand for X commodity increased by 25%. The goods can be considered ________.
  • essential goods
  • luxury goods
  • inferior goods
  • normal goods
Complementary goods are those which are _______.
  • consumed simultaneously
  • close competitors
  • both (A) and (B)
  • unrelated
Law of demand explain the relationship between _________.
  • price and quantity demanded
  • price and quantity supplied
  • price and cost of production
  • market demand and market price
Law of demand operates under _______.
  • ceteris paribus condition
  • normal operating condition
  • full employment condition
  • non-inflationary condition
Substitute goods are those which are consumed ______.
  • simultaneously
  • alternatively
  • in fixed proportion
  • rarely
An Engel curve is ________.
  • a type of demand curve which is angular
  • a type of demand curve named after Prof Engel
  • upward sloping demand curve
  • flat demand curve
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