Classical

Business Economics - Business Economics Questions

6:  
Utility theory is not able to explain the reason for
 
A.

Precious product

B.

Inferior goods

C.

Normal goods

D.

Giffen goods

 
 

Option: D

Explanation :

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7:  
Which of the following refers to perfect competition
(i) There are restrictions on buyers and sellers
(ii) There are no restrictions on movement of goods
(iii) There are no restrictions on factors of production
 
correct one is
A.

Only (i) and (ii)

B.

Only (ii) and (iii)

C.

Only (i) and (iii)

D.

Only (i)

 
 

Option: B

Explanation :

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8:  

The monopolist faces

A.
A downward sloping average revenue curve
B.

A downward sloping demand curve

C.

Both (a) & (b)

D.

None of the above

 
 

Option: C

Explanation :

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9:  

Which of the following statement is true

A.
In case of inferior good, the income  effect is negative, although the substitution effect is positive.
B.
In inferior goods, the income and substitution effects are positive
C.
In interior goods, the income and substitution effects are negative
D.
In case of inferior goods, the income effect is positive although the substitution effect is negative.
 
 

Option: A

Explanation :

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10:  

The law of variable proportions is

A.
also called law of non-proportional returns
B.

also called law of proportionality

C.
wider and includes law of increasing returns, law of decreasing returns & law of constant return as three phases
D.

All of the above

 
 

Option: D

Explanation :

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