3. X a consumer spends his entire income on two commodities A and (B) if price of A increases by 10% and his expenditure on item B remains same, then the price elasticity of item A is
Correct : A. 1
4. In question No. 207. If the price of item No. A instead of increasing falls by 25% and still his total expenditure as well expenditure on item B remains same, the price elasticity of A will be
Correct : A. 1
5. An individual is spending his entire income on two items A and B equally. If income elasticity of A is 4
what is income elasticity of B
Correct : C. 3
6. If an individual is spending his entire income on two items A and B in the ratio of 60:40. If income
elasticity of A is 5 what is income elasticity of B
Correct : C. 5
7. If prices of petrol rises from `40. To `48 per lt., the demand for cars falls from 60 per month to 45 per
month, the cross elasticity of petrol and Car is
Correct : B. 1.25
8. If prices of Eggs rises from `25 per dozen to `30 per dozen, the demand for vegetable burger increases
from 30 per day to 40 per day, then the cross elasticity of eggs and vegetable burger is
Correct : C. 1.65
9. Cross elasticity of a nearly perfect substitute products will be
Correct : A. Infinite
10. Cross elasticity of unrelated products will be
Correct : B. Zero
11. Cross elasticity of complementary products will be
Correct : D. < 0
12. If two goods are perfect substitutes for one another, the elasticity of substitution will be
Correct : A. Infinite
13. If two goods are not substitutes at all for one another, the elasticity of substitution will be
Correct : B. Zero
14. If the disposal income of a household increases by 10% and the demand for bread falls by 5%. The
income elasticity of bread is
Correct : B. -0.5
15. In question No. 218 bread can be considered as
Correct : C. Inferior goods
16. If the disposal income of a household increases by 10% and the demand for X commodity increased by
25%. The income elasticity of X is
Correct : C. 2.5
17. In question No. 220 X can be considered as
Correct : B. Luxury goods
18. If the disposal income of a household increases by 10% and the demand for X commodity increased by
10% the income elasticity of X is
Correct : D. 1.0
19. In question No. 222 X can be considered as
Correct : D. Normal goods
20. If the disposal income of a household decreases by 10% and the demand for X commodity remains
same. The income elasticity of X is
Correct : A. 0
21. In question No. 224 X can be considered as
Correct : A. An essential goods
22. Which of these would lead to increase in quantity supplied at a given price
Correct : D. Reduction in levies
23. Which of these would lead to decrease in quantity supplied at a given price
Correct : D. Imposition of higher levies
24. The income elasticity of demand of inferior goods is generally
Correct : C. < 0
25. The income elasticity of demand of normal goods is generally
Correct : D. > 0
26. The cross elasticity of complementary goods is generally
Correct : C. < 0
27. The cross elasticity of substitute goods is generally
Correct : D. > 0
28. The elasticity of a demand curve with a constant slope
Correct : A. Increases at higher price
29. A perfect inelastic supply curve will be
Correct : A. Parallel to Y axis or a vertical line
30. A perfectly elastic supply curve will be
Correct : B. Parallel to X axis
31. Which of the following is not a factor in market supply of a product
Correct : B. Number of buyers
32. The minimum price that a supplier expect to make available a specific quantity for sale is called
Correct : D. Supply price
33. The maximum quantity that a supplier is prepared to supply in the market at a given price is called
Correct : C. Supply quantity
34. Change in cost of production of the concerned goods causes
Correct : B. The supply curve to shift
35. Shift in supply curve is cause by
Correct : A. Change in citrus paribus conditions
36. At a given price increase in quantity supplied can be possible if ……………
Correct : D. All the three
37. Which of these is not a determinant of aggregate supply
Correct : A. Quantity demanded
38. A positive sloped supply curve for a product represents
Correct : B. Supply will move with the movement in the price in the same direction
39. Which of the following will have a relatively flat supply curve
Correct : A. Land
40. A supply curve parallel to X axis means the product supply is
Correct : B. Unlimited
41. Which of these will have highly inelastic supply curve
Correct : A. Perishable goods
42. Which of these is not a factor of quantity supplied
Correct : D. Consumers disposal income
43. The supply of goods means ……………
Correct : A. Quantity offered for sale at a given price and time
44. Under law of supply, ceteris paribus is
Correct : D. Both
45. According to law of supply ………..
Correct : D. Higher the price higher the quantity the seller is prepared to supply in market
46. The quantity that an individual supplier is prepared to supply over a period of time is a function of
Correct : C. Both
47. A desire culminates into demand or effective desire only when it is backed by
Correct : C. Both
48. The …………….. price that a customer is willing to pay for a given quantity is called demand price
Correct : A. Maximum
49. Goods or services that are not necessary for living are
Correct : C. Wants
50. Complementary goods are those which are ……………
Correct : A. Consumed simultaneously
51. Sugar and tea are …………… goods
Correct : A. Complementary
52. If price of sugar increase, the demand for tea will ………….
Correct : A. Fall
53. Increase in price of a product reduces the purchasing power as a result of which demand for a product goes up. This effect is known as
Correct : B. Income effect
54. Traditional approach to law of Demand was propounded by
Correct : C. Alfred Marshall
55. According to traditional approach the factor responsible for operation of downward slope of demand curve are
Correct : D. All the three
56. According to Modern approach, law of demand is caused by
Correct : C. Both
57. Which of these are exception to law of Demand
Correct : D. All the three
58. Shift in Demand curve or change in Demand curve occurs due to
Correct : C. Change in Cetris paribus conditions
59. Change in quantity demanded or Movement along demand curve occurs due
Correct : A. Due to change in price only
60. Increase in Demand is also known as – in economics
Correct : A. Expansion in demand
61. Decrease in Demand is also known as
Correct : D. Extraction in demand
62. Tea and coffee are
Correct : B. Alternative goods
63. If price of Tea increases the demand of coffee will
Correct : A. Increase
64. The demand function of a product x is as dx = 12-2Px, where Px stand for price. The quantity demanded
corresponding to price of `2 will be …………….
Correct : A. 8
65. In question No. 269 the quantity demanded if the price is 5 will be ……….
Correct : B. 2
66. If an Individual Y has a demand of 6 units of the product of market price of the product will be …………..
(Ref. Q. No. 269)
Correct : C. `3
67. If there are 5000 customers for the product, the aggregate market demand for the product at market
price `2 in the question No. 269 will be ………….
Correct : A. 40,000
68. Aggregate market demand in question No. 270 If there are 5000 customers will be ……
Correct : D. 16,000
69. The Supply function of a product x is as Sx = 5px + 3. Where Px stand for price. The quantity supplied corresponding to price of `2 will be ……………
Correct : B. 13
70. In question No. 274 if the price is `4 the supply available in the market will be ……..
Correct : D. 23
71. At what price the firm will be willing to supply 28 pieces in the market (Ref. Q. No. 274)
Correct : B. `5
72. If there are 1000 firms in the market dealing the product under question what would be the aggregate supply if the price is `4 (Ref. Q. No. 274)
Correct : B. 23,000
73. The individual demand and supply curve of a product are Dx = 12-2px, Sx=3+5px, where Px stand for price and Dx and Sc respectively stands for quantity demanded and quantity supplie(d) If there are 5000 consumers and 1000 suppliers for the product under question. What will be the equilibrium price
Correct : C. `3
74. What is the quantity demanded and supplied at the equilibrium price (Ref. Q. No. 278)
Correct : B. 22,000
75. What is the aggregate demand if the market price is `4.20 per unit (Ref. Q. No. 278)
Correct : D. 18,000
76. What is the aggregate supply if the market price is `4.20 per unit (Ref. Q. No. 278)
Correct : B. 24,000
77. Market demand curve for a commodity is
Correct : A. Horizontal summation of the individual demand curve for the commodity
78. Equilibrium state is achieved at
Correct : D. The intersection of demand and supply curve
79. Under the law of demand ceteris paribus is/are
Correct : D. All the three
80. The demand for a product is 25 units when the price is `10, however the demand rises to 26 when the price is reduced to `9.9 per unit. The marginal revenue from production and sale of additional unit from 25 to 26 is
Correct : A. `7.4
81. If in question No. 286 the price is reduced to `9 But the demand goes to 26 units what is the marginal
revenue from sale of 26th unit
Correct : B. `(-16)
82. In question No. 286 what is the total revenue from sale of 26 units
Correct : D. `257.40
83. In question No. 286 what is the total revenue from sale of 26 units
Correct : C. `234
84. In question No. 286 what is the average revenue from sale of 26 units
Correct : B. `9.9
85. If the question No. 286 despite reduction in price to `9.9 the demand for the product remains at 25 units
we can say that the demand for the product is
Correct : C. Perfectly inelastic
86. In question No. 286 if the price is reduced to `9 per unit the demand for the product instead of increasing fall down to 24 units, the goods can be ………..
Correct : C. Inferior goods
87. In question No. 286 if the price is increased to `11 per unit and the demand sharply falls to 20 unit, we
can say that the goods are ……………..
Correct : B. Luxury goods
88. A levy of excise duty on consumption of an item consumed will ……………..
Correct : D. Place the consumer on lower indifference curve
89. An imposition of excise duty would effect the demand of a product due to …………..
Correct : C. Both
90. Two commodities X and Y goods can be inferred as close substitute of each other if –
Correct : A. Increase in price of one leads to increase in demand of other and vice versa
91. Two Commodities X and UY can be inferred as complementary to each other if
Correct : B. Increase in price of one leads to decrease in demand of other and vice versa
92. Goods or services that are necessary for living are
Correct : A. Needs
93. A goods can be considered inferior goods in economics if increase in disposal income of the consumer
causes
Correct : C. Decrease in demand
94. A goods can be considered a normal goods in economics if increase in disposal income of the
consumer causes
Correct : A. An increase in demand
95. Change in consumers tastes and preference causes – of the particular goods
Correct : B. Shift in demand curve
96. Change in price of the goods cause
Correct : A. Change in quantity demanded
97. If price of Choco bar decreases we except
Correct : A. The quantity demanded to increase
98. According to law of demand
Correct : C. Lower the price higher the demand for the product
99. The quantity of a commodity that an individual is willing to purchase over a specified period of time is a
function of except ……….
Correct : D. Price of factor of production
100. Market demand curve for a commodity is a
Correct : A. Horizontal summation of all the individual demand curve for that product