Answer: Option A. -> necessities
Answer: (a)Consumer surplus is the difference between the price consumers would be prepared to pay and the actual market price.

Answer: Option D. -> Derived demand
Answer: (d)
The demand for labour is “derived” from the production and demand for the product being demanded.
If the demand for the product increases, either the price will increase or the demand for production labour will increase until the equilibrium price and production numbers are met. Labour is “derived” from the market demand for the product.

Answer: Option B. -> Population
Answer: (b)The supply curve for labor depends on variables such as population, wage rates, etc. in developing countries, the vast population base explains the relatively lower wage rates and easy accessibility to labour supply. This is just the opposite in the case of developed countries.

Answer: Option D. -> intermediate consumption
Answer: (d)
Expenditure on the advertisement and public relations by an enterprise is a part of its intermediate consumption. These are treated as intermediate goods and services which form part of the cost of producing other goods.
Intermediate consumption consists of the total monetary value of goods and services consumed or used up as inputs in production by enterprises, including raw materials, services and various other operating expenses.

Answer: Option A. -> long-run phenomenon
Answer: (a)
Returns to Scale refers to changes in production that occur when all resources are proportionately changed in the long run. It comes in three forms-- increasing, decreasing, or constant based on whether the changes in production are proportionally more than, less than, or equal to the proportional changes in inputs.
It is the guiding principle for long-run production, playing a similar role that the law of diminishing marginal returns plays for short-run production.

Answer: Option D. -> Fiscal Economics
Answer: (d)
The ‘Principle of Maximum Social Advantage’, introduced by British economist Hugh Dalton, is the fundamental principle of Public Finance which implies that all the financial operations of the state should aim at maximization of net social benefit.
It takes into consideration both the aspects of public finance that is the government revenue or taxation as well as government expenditure. Since it studies problems related to government taxation and spending, it comes under the domain of fiscal economics.

Answer: Option C. -> Perfectly elastic
Answer: (c)
Economic rent in the sense of surplus over transfer earnings arises when the supply of the factor units is less than perfectly elastic or not perfectly elastic.
When the supply of factor units is perfectly elastic, there is no surplus or economic rent and the actual earnings and transfer earnings are equal.
In such a scenario, at a given price or remuneration, the entrepreneur can engage any number of factor units.

Answer: Option D. -> extent of the market
Answer: (d)
Division of labour is a process whereby the production process is broken down into a sequence of stages and workers are assigned to particular stages.
As it is the power of exchanging that gives occasion to the division of labour, so the extent of this division must always be limited by the extent of that power, or, in other words, by the extent of the market. When the market is very small, no person can have any encouragement to dedicate himself entirely to one employment.

Answer: Option D. -> Wages paid to workers
Answer: (d)
In economics, fixed costs are business expenses that are not dependent on the level of goods or services produced by the business. They tend to be time-related, such as salaries or rents being paid per month and are often referred to as overhead costs.
For some employees, salary is paid on monthly rates, independent of how many hours the employees work. This is a fixed cost. On the other hand, the hours of hourly employees paid in wages can often be varied, so this type of labour cost is a variable cost.

Answer: Option B. -> marginal cost equals the marginal revenue
Answer: (b)
A consumer is in a state of equilibrium when he achieves maximum aggregate satisfaction on the expenditure that he makes depending on the set of conditions relating to his tastes and preferences, income, price and supply of the commodity etc.
Producers’ equilibrium occurs when he maximizes his net profit subject to a given set of economic situations. A firm’s equilibrium point is when it has no inclination in changing its production.
In the short run Marginal revenue = Marginal Cost is the condition of equilibrium.