Free Printable MCQ TEST

1.

Which of the following curve also represents price line?

a)

a. Marginal revenue curve

b)

b. Marginal cost curve

c)

c. Average cost curve

d)

d. Average revenue curve

2.

When marginal revenue is zero, total revenue is---

a)

a. Maximum

b)

b. Minimum

c)

c. Zero

d)

d. Decreasing

3.

Total revenue equals -----

a)

a. Price divided by total quantity sold

b)

b. Price plus Total quantity

c)

c. Price minus total quantity

d)

d. Price multiplied with total quantity sold

4.

A formula for the calculation of Marginal Revenue is---

a)

a. Total revenue divided by quantity sold

b)

b. Change in total revenue divided by change in quantity sold

c)

c. Total revenue multiplied by average revenue

d)

d. Average revenue multiplied by price

5.

When marginal revenue becomes negative, the total revenue--

a)

a. Decreases

b)

b. Increases

c)

c. Remains constant

d)

d. Becomes zero

6.

Total cost is obtained by adding

a)

a. Total variable cost and total fixed cost

b)

b. Marginal cost and average cost

c)

c. Total variable cost and average cost

d)

d. Average cost plus total fixed cost

7.

______________ is that part of the total cost which does not change with output

a)

a. Total variable cost

b)

b. Marginal cost

c)

c. Average cost

d)

d. Total Fixed cost

8.

Which of the following is an example of the fixed cost?

a)

a. Contractual rent

b)

b. Cost of raw material

c)

c. Cost of water

d)

d. Transport cost

9.

Which of the following cost is also known as ‘Overhead cost’?

a)

a. Marginal cost

b)

b. Average cost

c)

c. Total fixed cost

d)

d. Total variable cost

10.

Which of the following is also known as ‘Prime Cost’?

a)

a. Average cost

b)

b. Total variable cost

c)

c. Average variable cost

d)

d. Total fixed cost

11.

Which of the statement is correct, (i) There is a direct relation between output and total variable cost (ii) the total fixed cost also varies with the level of output

a)

a. (i) is correct

b)

b. (ii) is correct

c)

c. (i) and (ii) both are correct

d)

d. (i) and (ii) are incorrect

12.

The total cost curve can be drawn ----

a)

a. from the origin

b)

b. from a particular point on Y axis

c)

c. as a horizontal line

d)

d. as a vertical line

13.

At zero level of output—

a)

a. Total cost = Total fixed cost

b)

b. Total cost = Total variable cost

c)

c. Average cost = Marginal cost

d)

d. All of these

14.

Which of the cost curve is in the shape of rectangular hyperbola?

a)

a. Average variable cost

b)

b. Average Fixed Cost

c)

c. Marginal cost

d)

d. Total cost

15.

By dividing total variable cost with the output, we obtain

a)

a. Average cost

b)

b. Average fixed cost

c)

c. Average variable cost

d)

d. Marginal cost

16.

Which of the following cost curve is ‘U’ shaped?

a)

a. Average fixed cost curve

b)

b. Average cost curve

c)

c. Total cost curve

d)

d. Total fixed cost curve

17.

Which of the statement is correct, (i) The reason for the ‘U’ shaped average cost curve is due to economies and diseconomies of scale.,(ii) Average cost can never be negative

a)

a. (i) is correct

b)

b. (ii) is correct

c)

c. (i) and (ii) both are correct

d)

d. (i) or (ii) are not correct

18.

Which of the cost curve is known as ‘Envelope curve’?

a)

a. Long run marginal cost curve

b)

b. Long run average cost curve

c)

c. Short run average cost curve

d)

d. Marginal cost curve

19.

Which of the cost is also known as accounting cost?

a)

a. Implicit cost

b)

b. Explicit cost

c)

c. Both (i) and (ii)

d)

d. None of the above

20.

Accounting cost plus implicit cost is known as-------.

a)

a. Opportunity cost

b)

b. Marginal cost

c)

c. Economic cost

d)

d. Sunk cost

21.

Which of the following cost is an example of implicit cost

a)

a. Cost of raw material purchased

b)

b. Cost of machinery

c)

c. Rent paid to the landlord

d)

d. Salary of family member working as labour in own firm

22.

Which of the statement is correct, (i) In the long run TC curve is influenced by the slope of TVC curve, (ii) TC = TFC + TVC

a)

a. (i) is correct

b)

b. (ii) is correct

c)

c. (i) and (ii) are correct

d)

d. (i) and (ii) ate incorrect

23.

The cost of producing an extra unit of output is the---

a)

a. Total cost

b)

b. Marginal cost

c)

c. Fixed cost

d)

d. Variable cost

24.

____________ cost is considered as notional idea.

a)

a. Opportunity cost

b)

b. Explicit cost

c)

c. Implicit cost

d)

d. Sunk cost

25.

________________ of a given economic resource is the forgone benefits from the next best alternative use of that resource.

a)

a. Sunk cost

b)

b. Opportunity cost

c)

c. Implicit cost

d)

d. Explicit cost

26.

The downward slope of the average cost curve is due to---

a)

a. Decreasing returns to scale

b)

b. Increasing returns to scale

c)

c. Constant returns to scale

d)

d. None of the above

27.

The knowledge of ____________ concept is useful for efficient utilization of the resources

a)

a. Sunk cost

b)

b. Opportunity cost

c)

c. Accounting cost

d)

d. Implicit cost

28.

The shape of the firm's marginal revenue curve is horizontal or downward sloping depends on ______________

a)

a. Level of cost of production

b)

b. Level of production

c)

c. Number of competitors

d)

d. None of these

29.

The distinction between variable cost and fixed cost is relevant only in _____________

a)

a. long period

b)

b. short period

c)

c. medium term

d)

d. mixed period

30.

In order to maximise profit, a firm must minimise its _________________ cost.

a)

Economic cost

b)

Accounting Cost

c)

Fixed Cost

d)

Usage of fixed factors

31.

The Curve A represents ______________

a)

TR curve in Imperfect Competion

b)

AR curve in Imperfect Competion

c)

TR curve in Perfect Competion

d)

AR curve in Perfect Competion

32.

The curve that cuts the x-axis is known as ______________________

a)

TR Curve

b)

MR Curve

c)

AR Curve

d)

None of these

33.

‘Money is what money does’, whose definition is this?

F. A. Walker

G. Crowther

D. H. Robertson

J. M. Keynes

a)

F. A. Walker

b)

G. Crowther

c)

D. H. Robertson

d)

J. M. Keynes

34.

Measure of Value is considered to be the ______________ function of money.

a)

Primary

b)

Secondary

c)

Contingent

d)

None of these

35.

There is ____________ relationship between value of money and Quantity of Money

a)

Inverse

b)

Direct

c)

Both inverse and direct

d)

None of these

36.

The proponent of Quantity Theory of Money is ____________________

a)

Irving Fisher

b)

Alfred Marshall

c)

A. C. Pigou

d)

D. H. Robertson

37.

The Cash Balance Approach to the Value of Money is also known as ____________

a)

Fisher’s Quantity Theory of Money

b)

Cambridge Version of Quantity Theory of Money

c)

The Equation of Exchange

d)

None of these

38.

Who was of the opinion that ‘Price level is a passive element’?

a)

Alfred Marshall

b)

Irving Fisher

c)

D. H. Robertson

d)

David Ricardo

39.

Which of the following is also known as ‘Narrow Money’ measure?

a)

M₀

b)

M₁

c)

M₂

d)

M₃

40.

Who regarded ‘P’ as the ‘Value of Money’ in the Cash Balance Approach?

a)

D. H. Robertson

b)

J. M. Keynes

c)

Alfred Marshall

d)

A. C. Pigou

MCQ TEST

Total questions: 40

Worksheet time: 20mins

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