Business Economics MCQ Questions and Answers Part – 3
101. Cartel is a part of ——————
D. Perfect competition
102. While determining equilibrium of firm in short-run for perfect competition, the X-axis in the diagram represents —————-
103. The monopolist can fix any price for his product, but cannot determine ———- for his product.
104. The primary objective for discriminating monopolist is —————–
A. Loss minimization
B. Profit maximisation
C. To cover production cost
D. All of the above
105. A monopolistic competitive firm sells ————– products.
C. All of the above
106. Life insurance business in India is an example of ——————A. Perfect competition
B. monopolistic competition
107. A firm shut-down point is reached when ———–
A. average revenue fails to cover average total cost
B. average revenue fails to cover average variable cost.
C. average revenue fails to cover average fixed cost
D. average revenue fails to cover marginal cost.
108. In a perfectly competitive market, the firm will be —————
A. a price maker
B. attempting to maximise profits
C. Producing a product which will be different from its competitors
D. a price taker
109. Equilibrium implies a state of ——————–
C. absence of motion
110. A marginal buyer is the one ————–
A. who, if the price is increased a little is the first to go out of the market.
B. who, if the price is decreased a little is the first to enter the market.
C. who is indifferent about buying and not buying.
D. both a and c.
111. The following industry often is a monopoly —————
A. Cigarette industry
B. Publishing industry
C. Drug industry
D. Electric power industry
112. Under perfect competition, rivalry is ————–
B. very personal and direct, advertising being important
C. non existent since the firms cooperate
D. control output
113. A monopolistic firm will expand its output when ————-
A. marginal revenue exceeds marginal cost
B. marginal cost exceeds marginal revenue
C. marginal cost equals marginal revenue
D. marginal revenue is negative.
ANSWER: A114. A monopolist will never produce at a point where ————
A. demand is price – inelastic
B. demand is price – elastic
C. marginal cost is positive
D. marginal cost is increasing
115. Which of the following best defines price discrimination?
A. Charging different prices on the basis of race.
B. charging different prices for goods with different cost of production
C. charging different prices based on the cost of service difference
D. selling a certain product of given quality and cost per unit at different prices to different buyers.
116. Which one is not collusive oligopoly —————-
A. price leadership
B. market sharing cartel
C. price discrimination
D. price-fixing cartel
117. In an oligopolistic market, there are —————
A. a large number of sellers and few buyers
B. few sellers and few buyers
C. few sellers and large number of buyers
D. only one seller
118. The essential aspects of oligopoly is ————-
A. excess capacity
B. non-price competition
C. a large number of firms
D. mutual recognition of interdependence.
119. The kinked demand curve in Sweezy oligopoly model emerges due to assumption that ————-
A. when one seller decreases or increases his price, others follow.
B. when one seller decreases his price others follow him.
C. when one sellers decreases his price others follow but when he increases his price others do not follow
D. When one seller increases his price others decrease their prices.
120. Under perfect competition, firms do not engage in price-war because ————
A. firms work in co-operation with one another under the same.
B. number of firms under the same is very large
C. the demand for the product of a firm under the same is perfectly elastic
D. all the above-mentioned conditions are responsible
121. The equilibrium of a firm occurs when ——–