Classical

Business Economics - Business Economics Objective Type Questions

16:  

Law of diminishing marginal utility states

A.
Utility always diminishes whether something is consumed or not
B.
Total utility diminishes with the consumption of every additional unit
C.
Utility first increases and after that diminishes at every point
D.
The additional benefit which a person derives from a given increase of his stock of a thing diminishes with every increase in stock that he already has.
 
 

Option: D

Explanation :


17:  
The concept of supply curve as used in economic theory is relevant only for the case of
A.

Oligopoly

B.

Perfect or pure competition

C.

Monopolistic competition

D.

Monopoly

 
 

Option: B

Explanation :


18:  

In perfect competition, there is a process of

A.

Restricted entry and exit of the firms

B.

Free entry and free exit of the firms

C.

Free entry but restricted exit of the firms

D.

Semi-free exit but absolute free entry

 
 

Option: B

Explanation :


19:  
In short run, the law of variable proportions is also known as the
A.

Law of constant returns

B.

Law of diminishing returns

C.

Law of increasing returns

D.

Law of return to scale

 
 

Option: B

Explanation :


20:  
In the perfect competition at short run, the firm is a price .......... and can sell... ... amount of output at the going market price.
A.

Taker, any

B.

Taker, a definite

C.

Maker, Any

D.

None of the above

 
 

Option: A

Explanation :




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