http://www.gipe.ac.in/pdfs/Model%20question%20paper%203.pdfSection-B
5. A fall in demand for the product of a monopolized industry is predicted to lead to
a) a fall in price c) a decrease in the number of firms in the long run
b) a decrease in the output of each firm d) None of the above answers is satisfactory
8. Which of the following statements is correct for a profit-maximizing firm? Total Revenue
greater than or equal to Total Cost is
a) Necessary but not sufficient c) Necessary and sufficient
b) Sufficient but not necessary d) Neither necessary nor sufficient
11. Among the essential aspects of oligopoly is
i) Excess capacity ii) Non-price competition
iii) A large number of firms iv) Mutual recognition of interdependence
a) Both i) and ii) are satisfactory c) Only iv)
b) Both ii) and iii) are satisfactory d) None of the above is satisfactory
18. An economy is populated by individuals who have the same preferences. We can conclude
that there is no welfare gain from allowing them to trade
a) True c) Uncertain
b) False d) True, if there are only two goods
32. Consider an economy where only two goods are produced: cars and motorcycles. If one unit
of capital can produce more cars than motorcycles then it is efficient to employ all the
available capital in the production of cars.
a) True c) Uncertain
b) False d) True, if Government gives tax rebate on
loans to buy motorcycle.
37. Which of the following statements are true about the Keynesian consumption function?
a) It relates consumer demand and
disposable income.
c) Consumption depends on accumulated
wealth.
b) The real interest rate r determines how
people allocate income between
savings and consumption.
d) When people change their expectations about their permanent lifetime income,their current consumption changes even though their current income may not change.
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