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Total Questions : 874 | Page 6 of 88 pages
Question 51. Elasticity of supply refers to the degree of responsiveness of supply of a commodity to changes in its
  1.    Demand
  2.    Price
  3.    Cost of production
  4.    State of technology
 Discuss Question
Answer: Option B. -> Price
Question 52. When demand is perfectly inelastic, an increase in price will result in
  1.    A decrease in total revenue
  2.    An increase in total revenue
  3.    No change in total revenue
  4.    A decrease in quantity demanded
 Discuss Question
Answer: Option B. -> An increase in total revenue
Question 53. When equilibrium price rises but equilibrium quantity remains unchanged, the cause is
  1.    Supply and demand both increase equally
  2.    Supply and demand both decrease equally
  3.    Supply decreases and demand increases
  4.    Supply increases and demand decreases
 Discuss Question
Answer: Option C. -> Supply decreases and demand increases
Question 54. The cost on one thing in terms of the alternative given up is known as
  1.    Production cost
  2.    Physical cost
  3.    Real cost
  4.    Opportunity cost
 Discuss Question
Answer: Option D. -> Opportunity cost
Question 55. If demand is unitary elastic, a 25% increase in price will result in
  1.    25% change in total revenue
  2.    No change in quantity demanded
  3.    1% decrease in quantity demanded
  4.    25% decrease in quantity demanded
 Discuss Question
Answer: Option D. -> 25% decrease in quantity demanded
Question 56. Contraction of demand is the result of
  1.    Decrease in the number of consumers
  2.    Increase in the price of the commodity concerned
  3.    Increase in the prices of other goods
  4.    Decrease in the income of purchasers
 Discuss Question
Answer: Option B. -> Increase in the price of the commodity concerned
Question 57. According to M. Kalecki, the true measure of the degree of monopoly power is the
  1.    Ratio between price and marginal cost
  2.    Extent of monopolistic profit enjoyed by the monopolist
  3.    Cross-elasticity of demand for the product of the monopolist
  4.    Price charged by the monopolist minus marginal cost of production
 Discuss Question
Answer: Option A. -> Ratio between price and marginal cost
Question 58. Price of a product is determined in a free market by
  1.    Demand for the product
  2.    Supply of the product
  3.    Both demand and supply
  4.    The government
 Discuss Question
Answer: Option C. -> Both demand and supply
Question 59. When cross elasticity of demand is a large positive number, one can conclude that
  1.    The good is normal
  2.    The good is inferior
  3.    The good is a substitute
  4.    The good is complement
 Discuss Question
Answer: Option C. -> The good is a substitute
Question 60. All but one of the following are assumed to remain the same while drawing an individual's demand curve for a commodity. Which one is it?
  1.    The preferences of the individual
  2.    His monetary income
  3.    The price of the commodity under consideration
  4.    The prices of other goods
 Discuss Question
Answer: Option C. -> The price of the commodity under consideration

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