Managerial Economics

1. Which of the following is the best definition of managerial economics? Managerial economics is __________

• 1. 1. 
        a distinct field of economic theory.
        

• 1. a field that applies economic theory and the tools of decision science.
     

• 1. a field that combines economic theory and mathematics.
     

• 1. none of the above.

Normally the demand curve will have a _______________ shape.

• vertical
• horizontal
• upward sloping
• downward sloping

Sales Maximisation theory was given by _________________

• John Maynard Keynes
• William J. Baumol
• Adam Smith
• Milton Friedman

In Economics Utility Refers to ____________

• profit or loss
• supply and demand
• inflation or deflation
• satisfaction or usefulness

According to law of demand, when price reduces, demand ____________

• increases
• fluctuates.
• remains constant.
• decreases.

Which of the following is not an determinant of demand?

• Supply

• Climatic conditions

• Consumer preferences
• Price of substitute goods

Change in demand because of determinant other than price is called as ______________

• Movement

• shift in demand
• elasticity of demand
• price inelasticity

Responsiveness of supply to the change in price is called as ______________

• demand elasticity
• price elasticity of demand
• price elasticity of supply
• supply elasticity

According to law of supply, when price rises, supply _________________

• decreases.
• fluctuates.
• increases
• remains constant.

Responsiveness of demand to the change in price of related goods is called as _________________

• elasticity of demand
• cross elasticity of demand
• price elasticity of demand
• income elasticity of demand