Answer: Option B. -> Price
Answer: (b)
The exchange value of every commodity can be expressed in terms of money. This possibility has enabled money to become a medium for expressing values when the growing elaboration of the scale of values which resulted from the development of exchange necessitated a revision of the technique of valuation.
When the value is expressed in terms of money, it is called price. Thus, the price can be defined as the exchange value of a commodity expressed in terms of money.

Answer: Option A. -> marginal revenue with marginal cost
Answer: (a)
A perfectly competitive firm’s supply curve is that portion of its marginal cost curve that lies above the minimum of the average variable cost curve. A perfectly competitive firm maximizes profit by producing the quantity of output that equates to price and marginal cost.
In that price equals marginal revenue for a perfectly competitive firm, price is also equal to marginal cost. In other words, the firm produces by moving up and down along its marginal cost curve.
The marginal cost curve is thus the perfectly competitive firm’s supply curve.

Answer: Option B. -> initial inputs and ultimate output
Answer: (b)
Production function explains the relationship between factor input and output under given technology. It explains as to for increasing the output, in which proportion various inputs or factors may be employed under given technological conditions.
In short, production function may be defined as a technological relationship that tells the maximum output producible from various combinations of inputs. Production function explains the physical relationship between input and output under given technology.

Answer: Option A. -> An inverse relationship between marginal utility and the stock of commodity
Answer: (a)
The Marginal Utility Curve is a curve illustrating the relation between the marginal utility obtained from consuming an additional unit of a good and the quantity of the good consumed. The negative slope of the marginal utility curve reflects the law of diminishing marginal utility.
The marginal utility curve also can be used to derive the demand curve. Marginal Utility is the utility derived from the last unit of a commodity purchased. One of the earliest explanations of the inverse relationship between price and quantity demanded is the law of diminishing marginal utility.
This law suggests that as more of a product is consumed the marginal (additional) benefit to the consumer falls; hence consumers are prepared to pay less.

Answer: Option C. -> monopolistic competition
Answer: (c)
Monopolistic competition is a type of imperfect competition such that many producers sell products that are differentiated from one another (e.g. by branding or quality) and hence are not perfect substitutes.
Textbook examples of industries with market structures similar to monopolistic competition include restaurants, cereal, clothing, shoes, and service industries in large cities.

Answer: Option A. -> Consumer’s Sovereignty
Answer: (a)
Consumer sovereignty means that buyers ultimately determine which goods and services remain in production.
While businesses can produce and attempt to sell whatever goods they choose, if the goods fail to satisfy the wants and needs, consumers decide not to buy.
If the consumers do not buy, the businesses do not sell and the goods are not produced.

Answer: Option C. -> long-run average cost curve
Answer: (c)
Under perfect competition, the firms operate at the minimum point of the long-run average cost curve.
In this way, the actual long-run output of the firm under monopolistic competition falls short of what is produced under perfect competition which can be considered the socially ideal output. This gives the measure of excess capacity which lies unutilized under imperfect competition.

Answer: Option B. -> change in the price of the goods
Answer: (b)
Price elasticity of demand is a measure of the responsiveness of the quantity of a good or service demanded to changes in its price.
This measure of elasticity is sometimes referred to as the own-price elasticity of demand for a good, i.e., the elasticity of demand with respect to the good's own price, in order to distinguish it from the elasticity of demand for that good with respect to the change in the price of some other good, i.e., a complementary or substitute good.

Answer: Option C. -> their marginal utility to buyers is higher than that of water.
Answer: (c)
The water diamond paradox or puzzle was a mystery of Adam Smith who observed that the price of diamonds was much higher than that of water even though water seemed to offer far more utility than diamonds.
The resolution of this puzzle or paradox is based on the distinction between marginal utility and total utility. The marginal utility of diamonds is very high and so consumers are willing to pay higher prices for diamonds, than for water.

Answer: Option B. -> Monopolistic Competition
Answer: (b)
Monopolistic competition is a type of imperfect competition such that many producers sell products that are differentiated from one another as goods but not perfect substitutes (such as from branding, quality, or location).
In monopolistic competition, a firm takes the prices charged by its rivals as given and ignores the impact of its own prices on the prices of other firms.
There are six characteristics of monopolistic competition (MC):
Product differentiation;
many firms;
Free entry and exit in the long run;
Independent decision making;
market power; and
Buyers and Sellers do not have perfect information.
Toothpaste, toilet papers, computer software and operating systems are examples of differentiated products.