1st Year Principles of Economics 2nd Quarter Book Paper

Q1. Multiple choice questions (Attempt all · 12 × 1 = 12)

1. Monopoly can also be called:

   1. Perfect competition

   2. Imperfect competition

   3. Competition

   4. None

2. The second name of law of constant return is:

   1. Law of decreasing cost

   2. Law of increasing cost

   3. Law of cost

   4. Law of constant cost

3. Amount of money attained by selling marginal product is called:

   1. Average revenue product

   2. Marginal revenue product

   3. Total revenue product

   4. None of the above

4. The costs which are directly related to output:

   1. Fixed cost

   2. Variable cost

   3. Total cost

   4. Marginal cost

5. What can a firm do in the short run:

   1. Firm can increase its plants

   2. Firm can expand its building

   3. New firm can not enter the business

   4. New firm can enter the business

6. When marginal product is zero total product is:

   1. Maximum

   2. Minimum

   3. Negative

   4. Zero

7. According to which theory every factor of production gets the reward of its services equal to its marginal product?

   1. Demand and supply theory

   2. Liquidity preference theory

   3. Marginal productivity theory

   4. Uncertainty theory

8. The cost that a firm has to bear to produce an extra unit of output are called:

   1. Fixed cost

   2. Average cost

   3. Total cost

   4. Marginal cost

9. If there are large number of firms in some particular industry then situation is called:

   1. Perfect competition

   2. Imperfect competition

   3. Monopoly

   4. Monopolistic competition

10. In a production process when units of variable factors along with fixed factor of production are increased marginal cost goes on falling this tendency in economics is called:

    1. Law of decreasing cost

    2. Law of constant cost

    3. Law of increasing cost

    4. Law of decreasing return

11. Which law is applicable on production process under marginal productivity theory?

    1. Law of increasing return

    2. Law of constant return

    3. Law of decreasing return

    4. Law of decreasing cost

12. The rate of change in total cost is called:

    1. Average cost

    2. Marginal cost

    3. Average fixed cost

    4. Average variable cost