Classical

Business Economics - Business Economics Questions

11:  

Assertion (A). Total utility will be maximum when marginal utility to price of respective products are equal.

Reason (R). Deviation from this situation leads to reduction in maximum utility.

A.

(A) and (R) are not correct.

B.

(A) is correct but (R) is not correct.

C.

(A) and (R) are correct.

D.

(A) is incorrect (R) is correct.

 
 

Option: C

Explanation :


12:  
Decrease or fall in the price of commodity leads to increase in demand because of
A.
Substitution effect i.e. Relatively cheaper than related goods
B.
Income effect i.e. Consumer becomes better off
C.

Both (a) & (b)

D.

None of these

 
 

Option: C

Explanation :


13:  
Which of the following firm witnesses kinked demand curve
A.

Monopoly firm

B.

Oligopoly firm

C.

Perfectly competitive firm

D.

Duopoly firm

 
 

Option: B

Explanation :


14:  
For profit Maximization of a firm we must
have
(i) MC=MR
(ii) Marginal cost curve cuts the average cost curve
Which one is correct statement
 
A.

Only (i) is correct

B.

Only (ii) is correct

C.

Both incorrect

D.

Both correct

 
 

Option: D

Explanation :


15:  

Assertion (A). Utility will be maximised when the marginal unit of expenditure in each direction brings the same increment of utility."

Reason (R). A consumer will try to maximise his utility.

A.

Both (A) and (R) are true.

B.

Both (A) and (R) are false.

C.

(A) is true but (R) is false.

D.

(A) is false but (R) is true.

 
 

Option: A

Explanation :




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