1. When a perfectly competitive industry is in long-run equilibrium, all firms in the industry
Correct : D. All of the above are correct
2. The short-run supply curve of a perfectly competitive firm
Correct : A. is equal to that portion of the short-run marginal cost curve that is above the average variable cost curve
3. A monopolized market is in long-run equilibrium when
Correct : C. production takes place where long-run marginal cost is equal to marginal revenue and price is not below long-run average cost
4. A monopolist produces 14,000 units of output and charges Rs.14 per unit. Its marginal
revenue is Rs.8, its marginal cost is Rs.7 and rising, its average total cost is Rs.10, and its average variable cost is Rs.9. The monopolist should
Correct : A. increase curve output, which will result in an increase in the firm\s positive economic profit
5. Which of the following types of firms is likely to be a monopolistic competitor?
Correct : C. A restaurant
6. Which of the following is a differentiated product?
Correct : D. All of the above
7. Which of the following is a characteristic of monopolistic competition?
Correct : A. Few sellers
8. The demand faced by a monopolistically competitive firm is
Correct : B. elastic
9. If an imperfectly competitive firm is producing a level of output where marginal cost is equal to marginal revenue, marginal revenue is below average variable cost, and price is
equal to average total cost, then the firm
Correct : D. None of the above is correct
10. Product variation refers to
Correct : A. an activity undertaken by a firm to increase demand
11. Which of the following is a criticism of the theory of monopolistic competition?
Correct : D. All of the above are correct
12. Which of the following industries is most likely to be monopolistically competitive?
Correct : C. The car repair industry
13. Marginal revenue is equal to price for which one of the following types of market
structure?
Correct : B. Perfect competition
14. Monopoly market is :
Correct : A. Single seller market
15. Third degree price discrimination occurs when the monopolist charges
different prices for the same commodity in different
Correct : A. Markets
16. Lerner Index is a measure of:
Correct : B. Monopoly power
17. The dual pricing system of charging high price during peak time and low price during of peak time is called
Correct : D. peak load pricing
18. The marker structure which have very large number of sellers selling Identical
products is called
Correct : A. Perfect competition
19. The marker structure with Perfect mobility of factors and products is called
Correct : A. Perfect competition
20. The marker structure with Perfect knowledge is called
Correct : A. Perfect competition
21. The large number of firms producing the same commodity ensure that the
individual firm has no control over
Correct : C. Both of the above
22. Individual firm has no control on the price of the commodity in the market is a
condition of
Correct : A. Perfect competition
23. In a Perfect competitive market
Correct : D. Both are price takers
24. Under perfect market conditions the individual firm in the industry has
------------------- control over the price of the product.
Correct : C. No
25. The marker structure which have large number of sellers selling differentiated
product is called
Correct : C. Monopolistic competition
26. The marker structure in which number of sellers is small with
interdependence is called
Correct : D. Oligopoly
27. The cost incurred to alter the position or slope of demand curve is known as
Correct : B. Selling cost
28. Which of the following is a form collusive oligopoly
Correct : C. cartel
29. In the long run, which of the following is applicable to a firm under
monopolistic competition
Correct : A. AR = AC
30. A discriminating monopolist will charge a higher price from which
group of customers?
Correct : B. Group with less elastic
31. Perfect price discrimination means that every customer ____________
Correct : D. pays what she thinks the product is worth
32. Supernormal profit refers to
Correct : A. High proportion of net profit
33. Which one of the following is related to the commodity money
Correct : D. All of the above
34. Which of the following is not related to commodity money
Correct : C. They lacked portability
35. Find the odd man out with reference to money
Correct : D. Gold
36. Match the following A B
1. (i) Commodity money (i) Currency
2. (ii) Metallic money (ii) Cheque
3. (iii) Paper money (iii) Gold
4. (iv) Credit money (iv) Bows and arrows
Codes;
Correct : D. (iv) (iii) (i) (ii)
37. Which of the following is not correctly matched
Correct : C. Grains – used as money by the agricultural society
38. Assertion (A): Necessity led to the invention of money
Reason(R) : Barter system failed to perform the major functions of money
Correct : D. Both (A) and (R) are true but (R) is not the correct explanation of (A)
39. Which one of the following is an example of “fiat money”
Correct : D. Currency notes
40. In the case of paper currency
Correct : B. Intrinsic value is less than face value
41. The most liquid form of all assets is
Correct : D. Currency notes
42. In India the standard money is
Correct : B. Rupee
43. In the case of a ‘full bodied money’
Correct : B. Intrinsic value is equal to face value
44. In the case of a ‘token money’
Correct : C. Face value is greater than the metal value
45. Demand for money arises from
Correct : C. Both A and B
46. Cost – push inflation arises due to
Correct : D. All of the above
47. Which of the following is a concept of ‘broad money’
Correct : C. M3
48. In the Quantity Theory of Money Fischer states that, while other things remains the
same,
Correct : A. Price level varies directly with the quantity of money
49. Inflation is a situation where
Correct : C. Value of money is rising
50. In the case of ‘creeping inflation’ prices are rising at
Correct : C. Around 5% per month
51. ‘Stagflation’ is a situation where the economy faces
Correct : B. Stagnation
52. Which of the following is not a function of a commercial bank
Correct : C. Advancing loans
53. The RBI set up in the year
Correct : B. 1935
54. Which of the following represents the major functions of the central bank
Correct : D. All of the above
55. Find the odd man out
Correct : C. Open market operation
56. Bank rate refers to
Correct : B. Market rate
57. Open market operation influences
Correct : C. Both A and B
58. Which of the following is an anti-deflationary monetary policy
Correct : A. Purchase of government securities from commercial banks and from the public
59. Let the cash reserve ratio is 12%. Then the value of credit multiplier will be
Correct : B. 8.3
60. Inflation represents:
Correct : C. decrease value of money
61. Who told Inflation is too much of money chasing too few goods:
Correct : A. Coulbourn
62. Among the following which is not a feature of inflation?
Correct : D. non monetary phenomenon.
63. Deflation means:
Correct : A. falling price level
64. Only Money Matters is Propounded by:
Correct : B. Monetarists
65. Sacrifice ratio measures :
Correct : A. Output lose
66. When prices of only few commodities rise
Correct : A. Sporadic Inflation
67. Which is the slowest inflation?
Correct : C. Creeping inflation
68. The rate of inflation in walking inflation is:
Correct : A. between 3to 10 %
69. Price rise in every second is referred as
Correct : D. Hyper inflation
70. Inflation due to hording
Correct : B. Scarcity inflation
71. Long run Phillips Curve is :
Correct : C. Vertical
72. In business cycle, depression is followed by:
Correct : B. Recovery
73. The Working Group for the Revision of Wholesale Price Index Number headed by :
Correct : A. Prof. Abhijit Sen
74. The headline inflation in India is measured in:
Correct : A. WPI
75. The working group in India include in the age:
Correct : B. 15 to 59
76. Open market operations refer to the sale and purchase by the RBI of :
Correct : C. Government securities
77. Which of the following is not an objective of monetary policy?
Correct : D. Reduction in export
78. Which of the following is not an element of high Powered money?
Correct : B. Repos
79. The ratio of money supply to high powered money is:
Correct : C. Money Multiplier
80. Fiscal Policy is a policy of the
Correct : B. Government
81. Fiscal Policy includes:
Correct : C. both a and b
82. The objective of Monetary Policy is :
Correct : A. to print notes of desired denominations
83. Fiscal Policy refers to policy towards:
Correct : D. all of the above
84. In a closed economy which of the following is not a macroeconomic objective?
Correct : C. BOP stability
85. A business cycle is composed of ----- phases:
Correct : C. 4 Phase
86. The percentage of deposits of commercial banks statutorily kept with the RBI is :
Correct : A. Cash Reserve Ratio
87. Peak is the --- turning point of the business cycle.
Correct : A. Upper turning point
88. Wage control is an instrument of ---- policy
Correct : C. Incomes policy
89. The trough of a business cycle occurs when hits its lowest point.
Correct : C. aggregate economic activity
90. The lowest point in the business cycle is referred to as the:
Correct : C. Trough.
91. When aggregate economic activity is increasing, the economy is said to be in:
Correct : A. an expansion.
92. When aggregate economic activity is declining, the economy is said to be in:
Correct : A. a contraction.
93. Economists use the term shocks to mean:
Correct : B. typically unpredictable forces that have major impacts on the economy
94. Wars, new inventions, harvest failures, and changes in government policy are examples
of:
Correct : C. shocks.
95. Peaks and troughs of the business cycle are known collectively as: