Business Economics - Questions and Answers for Competitive Exams | GkSeries

37. The supply of a product does not depend on _____________.

• [A] labor costs.
• [B] the number of sellers in the market.
• [C] consumers tastes.
• [D] existing technology

Answer: Option [C]

38. The costs that depend on output in the short run are _____________.

• [A] total variable costs only.
• [B] both total variable costs and total costs.
• [C] total costs only.
• [D] total fixed cost only

Answer: Option [A]

39. Marginal cost is defined as

• [A] Total cost divided by output
• [B] Change in output due to a one unit change in an input
• [C] Total product divided by the quantity of input
• [D] Change in total cost due change in output

Answer: Option [D]

40. Implicit costs are ________________.

• [A] equal to total fixed costs.
• [B] payments for self-employed resources.
• [C] comprised entirely of variable costs
• [D] always greater in the short run than in the long run

Answer: Option [B]

41. In the law of variable proportion when TP is Maximum then the MP = ____________

• [A] MP=1
• [B] MP<0
• [C] MP=0
• [D] MP>1

Answer: Option [C]

42. Cobb Douglas production function mainly studies ____________?

• [A] Capital and Labour
• [B] Labour and Entreprenuer
• [C] Land and Labour
• [D] Land and Capital

Answer: Option [A]

43. The cost with which the concept of marginal cost is closely related

• [A] variable cost
• [B] fixed cost
• [C] opportunity cost
• [D] economic cost

Answer: Option [A]

44. ____________ costs are business costs which do not involve any cash payments but for them a provision is made in accounts

• [A] Private cost
• [B] Social Cost
• [C] Accounting Cost
• [D] Book Cost

Answer: Option [D]

45. The vertical difference between TVC and TC is equal to ____________

• [A] MC
• [B] AVC
• [C] TFC
• [D] None

Answer: Option [C]

46. 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]

47. The formula for average variable cost (AVC) is __________________.

• [A] DQ/DTVC
• [B] DTVC/DQ
• [C] TVC/Q
• [D] Q/TVC

Answer: Option [C]

48. In case of oligopoly, number of firms is

• [A] Larger
• [B] Infinite
• [C] One
• [D] Few

Answer: Option [D]