Questions
25. Passive factor of production is ________________.
- [A] Only land.
- [B] Only capital.
- [C] Both land and capital.
- [D] Neither land nor capital
Answer: Option [C]
26. _____________ Economies views on reducing the Production costs
- [A] Internal
- [B] Inventory
- [C] Pecuniary
- [D] External
Answer: Option [D]
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27. Which factor of production is considered as fixed input?
- [A] Labour
- [B] Technology
- [C] Capital
- [D] Land
Answer: Option [D]
28. _____________ is the remuneration for organisation
- [A] Rent
- [B] Wages
- [C] Interest
- [D] Profit
Answer: Option [D]
29. When the output increases in the same proportion as the increase in input it is _____________ Returns
- [A] Constant
- [B] Average
- [C] Decreasing
- [D] Increasing
Answer: Option [A]
30. Marginal cost is defined as
- [A] Total cost divided by output
- [B] Change in total cost due change in output
- [C] Change in output due to a one unit change in an input
- [D] Total product divided by the quantity of inpu
Answer: Option [B]
31. Which of the following is correct
- [A] TC= TFC+ TVC
- [B] TFC= TC- TVC
- [C] TVC= TC- TFC
- [D] All of the above
Answer: Option [D]
32. Opportunity Cost is also Known as _____________
- [A] outlay cost
- [B] Sunk Cost
- [C] Alternative Cost
- [D] Total Cost
Answer: Option [C]
33. The vertical difference between TVC and TC is equal to _____________
- [A] MC
- [B] AVC
- [C] TFC
- [D] None
Answer: Option [C]
34. The formula for average variable cost (AVC) is __________________.
- [A] DQ/DTVC.
- [B] DTVC/DQ.
- [C] TVC/Q
- [D] Q/TVC
Answer: Option [C]
35. The rate at which a firm can substitute capital for labour and hold output constant is the
______________.
- [A] marginal rate of production
- [B] law of diminishing marginal returns
- [C] marginal rate of factor substitution
- [D] isoquant.
Answer: Option [C]
36. The formula for average fixed costs is __________________
- [A] TFC/Q
- [B] DQ/DFC.
- [C] Q/TFC.
- [D] TFC _ Q
Answer: Option [A]
