Sail E0 Webinar

11th Grade > Economics - 1

PRODUCER BEHAVIOUR MCQs

Total Questions : 29 | Page 1 of 3 pages
Question 1. If isoquants are plotted on a graph with capital measured on the vertical axis and labor on the horizontal axis, then an increase in the wage rate will cause the isocost line
  1.    to become steeper and the optimal quantity of labor will decrease
  2.    to become steeper and the optimal quantity of labor will increase
  3.    to become flatter and the optimal quantity of labor will decrease
  4.    to become flatter and the optimal quantity of labor will increase
 Discuss Question
Answer: Option A. -> to become steeper and the optimal quantity of labor will decrease
:
A
If isoquants are plotted on a graph with capital measured on the vertical axis and labor on the horizontal axis, then an increase in the wage rate will cause the isocost lineto become steeper and the optimal quantity of labor will decrease.
Question 2. A country that has an abundance of cheap labor will tend to
  1.    import goods that are produced using a lot of labor
  2.    refrain from international trade entirely
  3.    export goods that are produced using a lot of labor
  4.    export goods that are produced using little labor
 Discuss Question
Answer: Option C. -> export goods that are produced using a lot of labor
:
C
A country that has an abundance of cheap labor will tend toexport goods that are produced using a lot of labor.
Question 3. The marginal revenue product of labor for a firm
  1.    will increase if the price of the firm's output increases
  2.    is the firm's demand curve for labor
  3.    will decrease if the firm hires more labor
  4.    All of the above are correct
 Discuss Question
Answer: Option D. -> All of the above are correct
:
D
All the options are correct.
Question 4. An isoquant that is
  1.    further from the origin represents greater output
  2.    flatter represents the trade-offs between inputs that are poor substitutes
  3.    negatively sloped represents input combinations associated with Stage I of production
  4.    All of the above are correct
 Discuss Question
Answer: Option A. -> further from the origin represents greater output
:
A
An isoquant that isfurther from the origin represents greater output.
Question 5. MP curve is an inverted U-shaped curve.
  1.    True
  2.    False
  3.    marginal product is at a maximum
  4.    All of the above are correct
 Discuss Question
Answer: Option A. -> True
:
A
True.MP curve is an inverted U-shaped curve.
Question 6. Fixed factor are those factors, which can be increased or decreased in a short period of time to adjust supply.
  1.    True
  2.    False
 Discuss Question
Answer: Option B. -> False
:
B
Fixed factors or production are fixed in the short run. In the long run, all factors are variable.
Question 7. Factors of production are imperfect substitutes of each other. 
  1.    True
  2.    False
  3.    marginal product is at a maximum
  4.    All of the above are correct
 Discuss Question
Answer: Option A. -> True
:
A
True.Factors of production are imperfect substitutes of each other. More and more of labour cannot be continuously used in place of capital. Accordingly, diminishing returns are bound to set in if only the variable factor is increased to increase output.
Question 8. At the point of inflexion:
  1.    Average product is maximum
  2.    Marginal product is maximum
  3.    Total product is maximum
  4.    None of the above
 Discuss Question
Answer: Option B. -> Marginal product is maximum
:
B
Point of inflexionis the point where the slope of the TP curve reaches the maximum and starts decreasing. At this point, MP is maximum.
Question 9. Standard of living of a country can be raised if it increases:
  1.    Labour force
  2.    Production
  3.    Money supply
  4.    Exports
 Discuss Question
Answer: Option B. -> Production
:
B
Standard of living of a country can be raised if it increases production.
Question 10. Economic development of a country requires:
  1.    Skilled labour
  2.    Diplomacy
  3.    Abundant natural resources
  4.    (a) and (c) of above
 Discuss Question
Answer: Option D. -> (a) and (c) of above
:
D
Economic development of a country requires skilled labour and abundant natural resources.

Latest Videos

Latest Test Papers