introduction to micro economics section 8 Practice Questions Answers Test with Solutions & More Shortcuts
Introduction to Micro Economics PRACTICE TEST [8 - EXERCISES]
introduction to micro economics section 1
introduction to micro economics section 2
introduction to micro economics section 3
introduction to micro economics section 4
introduction to micro economics section 5
introduction to micro economics section 6
introduction to micro economics section 7
introduction to micro economics section 8
Question : 1 [SSC CPO 2003]
If the price of an inferior good falls, its demand
a) can be any of the above
b) rises
c) falls
d) remains constant
Answer »Answer: (b)
Some goods are known as inferior goods. With inferior goods, there is an inverse relationship between real income and the demand for the good in question.
If real incomes rise, the demand for an inferior good will fall. If real incomes fall (in a recession, for instance), the demand for an inferior good will rise.
Example: Bus travel. As people get richer, they are more likely to buy themselves a car, or use a taxi, rather than rely on the more inferior bus, so the demand for bus travel falls as real incomes rise.
Question : 2 [SSC Constable 2012]
The expenses on advertising is called
a) Selling cost
b) Implicit cost
c) Surplus cost
d) Fixed cost
Answer »Answer: (a)
Selling cost is total cost of marketing, advertising, and selling a product. It differs from the production cost which is incurred to produce goods. Selling cost influences the commercial desire to purchase a commodity.
Question : 3 [SSC CML 2001]
If the change in demand for a commodity is at a faster rate than change in the price of the commodity, the demand is
a) inelastic
b) perfectly inelastic
c) elastic
d) perlectly elastic
Answer »Answer: (d)
If quantity demanded changes by a very large percentage as a result of a tiny percentage change in price, then the demand is said to be perfectly elastic.
It reflects the fact that the quantity demanded is extremely responsive to even a small change in price.
Technically, the elasticity in this extreme case would be undefined but it approaches negative infinity as demand becomes more elastic.
Question : 4 [SSC DEO & LDC 2012]
Which one of the following pairs of goods is an example for Joint Supply ?
a) Wool and Mutton
b) Coffee and Tea
c) Ink and Pen
d) Tooth brush and Paste
Answer »Answer: (a)
The production of two or more goods simultaneously from the same imputs is called Joint Supply. Wool and Mutton are an example for joint supply.
Question : 5 [SSC CML 2001]
The term “market” in Economics means
a) Shops and super bazars
b) A central place
c) Presence of competition
d) Place where goods are stored
Answer »Answer: (b)
The most important defining characteristic of a market in economics is that it allows buyers and sellers to exchange any type of goods, services and information.
According to Walter Christaller’s ‘Central Place Theory,’ a central place is a market centre for the exchange of goods and services by people attracted from the surrounding area.
The central place is so-called because it is centrally located to maximize accessibility from the surrounding region.
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Introduction to Micro Economics Shortcuts »
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indian economy MCQ CATEGORIES
-
» Introduction to Indian Economy
-
» Planning, Economic Development & Five year Plans
-
» National Income & Human Development Index
-
» Agriculture Sector, Subsidy and Food Processing
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» Industries, Manufacturing & Service Sectors
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» Inclusive growth, Sustainable development and employment
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» Poverty & Unemployment
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» Introduction to Micro Economics
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» Introduction to Macro Economics
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» Macro fundamentals, GDP, Investment, Growth
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» Demand & Supply, Profit Loss, Inflation & Price Index
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» Fiscal Policy, Public Finance and Monetary Policy
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» Money Supply, Banking and Financial Institutions
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» Taxes Types, Methods & Budgeting Process
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» Banking, Security Market & Insurance
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