40 + Mcqs in Managerial Economics 1 Page 1 McqOptions

1.	The famous book on economics An Enquiry into the Nature and Cause of Wealth of Nation was written by
A.	marshal
B.	ricardo
C.	robins
D.	adam smith
Answer» E.

Discussion

2.	.. principle is closely related to the marginal costs and marginal revenue of economic theory
A.	principle of time perspective
B.	equi marginal principle
C.	incremental principle
D.	none of these
Answer» D. none of these

Discussion

3.	What effect is working when the price of a good falls and consumers tend to buy it insteadof other goods
A.	income effect
B.	substitution effect
C.	price effect
D.	none of these
Answer» C. price effect

Discussion

4.	Analysis of long run and short run affects of decisions on revenue as well as costs is bas ed on
A.	principle of time perspective
B.	equi marginal principle
C.	incremental principle
D.	none of these
Answer» B. equi marginal principle

Discussion

5.	If the income and substitution effect of a price increase works in the same direction the good whose price has changed is a
A.	giffen goods
B.	inferior goods
C.	normal goods
D.	superior
Answer» D. superior

Discussion

6.	.is economic theory used in business whereas .is economics theory used in business and non business organization
A.	Micro economics, macro economics
B.	Business economics, managerial economics
C.	Positive economics and normative economics
D.	None of these
Answer» C. Positive economics and normative economics

Discussion

7.	means an attempt to determine the factors affecting the demand of a commodity or service and to measure such factors and their influences
A.	Demand planning
B.	Demand forecasting
C.	Demand analysis
D.	Demand estimation
Answer» D. Demand estimation

Discussion

8.	When an individual s income falls (while everything else remains the same), his demand for an inferior good:
A.	increases
B.	decrease
C.	remains unchanged
D.	we cannot say without additional information
Answer» C. remains unchanged

Discussion

9.	demand forecasting is prepared by different trade association in order to estimate the demand for particular industries products
A.	Macro level
B.	Industry level
C.	Firm level
D.	None of these
Answer» C. Firm level

Discussion

10.	a statement in the form of a table that shows the different quantities of a commodity that a firm or a producer offers for sale in the market at different prices.
A.	supply schedule
B.	production schedule
C.	demand schedule
D.	price schedule
Answer» B. production schedule

Discussion

11.	The change in demand due to change in price only, where other factors remaining constant, it is called .
A.	shift in demand
B.	extension of demand
C.	contraction of demand
D.	both extension and contraction
Answer» E.

Discussion

12.	. means an attempt to determine the factors affecting the demand of a commodity or service and to measure such factors and their influences
A.	demand planning
B.	demand forecasting
C.	demand analysis
D.	demand estimation
Answer» D. demand estimation

Discussion

13.	A fall in the price of a commodity whose demand curve is a rectangular hyperbola causes total expenditure on the commodity to:
A.	increases
B.	decrease
C.	remains unchanged
D.	any of the above
Answer» D. any of the above

Discussion

14.	The claim that, other things equal, the quantity supplied of a goods rises when the price of goods raises known as:
A.	Law of economics
B.	Law of supply
C.	Law of demand
D.	All of these
Answer» C. Law of demand

Discussion

15.	The proportionate change in the quantity demanded of a commodity in response to change in the price of another related commodity is called
A.	Price elasticity
B.	Related elasticity
C.	Cross elasticity
D.	Income elasticity
Answer» D. Income elasticity

Discussion

16.	Law of demand shows the functional relationship between _______ and quantity demanded
A.	supply
B.	cost
C.	price
D.	requirements
Answer» D. requirements

Discussion

17.	The competitive firm s long run supply curve is the portion of it s ..curve lies above average total cost.
A.	Marginal cost
B.	Revenue cost
C.	Fixed cost
D.	All of these
Answer» B. Revenue cost

Discussion

18.	..is the process of finding current values of demand for various values of prices and other determining variables.
A.	Demand Estimation
B.	Demand analysis
C.	Demand function
D.	Demand forecasting
Answer» B. Demand analysis

Discussion

19.	A demand curve which takes the form of horizontal line parallel to quantity axis illustrates elasticity which is:
A.	zero
B.	infinite
C.	greater than one
D.	less than one
Answer» E.

Discussion

20.	In .approach, Consumers reactions on the new products are found out indirectly with the help of specialized dealers
A.	Growth curve approach
B.	Evolutionary approach.
C.	Opinion polling approach
D.	Vicarious approach.
Answer» E.

Discussion

21.	In approach, on the basis of the growth of an established product, the demand for the new product is estimated
A.	Growth curve approach
B.	Evolutionary approach.
C.	Opinion polling approach
D.	vicarious approach
Answer» B. Evolutionary approach.

Discussion

22.	.. is the change in total revenue irrespective of changes in price or due to the effect of managerial decision on revenue
A.	Average revenue
B.	Total revenue
C.	Marginal revenue
D.	Incremental revenue
Answer» E.

Discussion

23.	.. a schedule that depicts the supply by an individual firm or producer of a commodity in relation to its price
A.	market price schedule
B.	market supply schedule
C.	individual supply schedule
D.	none of them
Answer» D. none of them

Discussion

24.	A graph indicating different combination of inputs with different level of output is called
A.	iso-cost map
B.	bep map
C.	input-output map
D.	iso-quant map
Answer» E.

Discussion

25.	Marginal revenue is .at the quantity that generate maximum total revenue and negative beyond that point.
A.	Zero
B.	One
C.	+1
D.	-1
Answer» B. One

Discussion

26.	Under which method, the cost is added with the predetermined target rate of return on capital invested
A.	Cost plus pricing
B.	Target pricing
C.	Mark up pricing
D.	None of these
Answer» C. Mark up pricing

Discussion

27.	refers to the quantity of a good or service that producers are willing and able to sell during a certain period under a given set of conditions
A.	supply
B.	demand
C.	price
D.	production
Answer» B. demand

Discussion

28.	Higher the price of certain luxurious articles, higher will be the demand, this concept is called
A.	giffen effects
B.	veblen effects
C.	demonstration effects
D.	both b & c above
Answer» C. demonstration effects

Discussion

29.	An input should be so allocated that the value added by the last unit is the same in all cases.
A.	opportunity cost principle
B.	equi-marginal principle
C.	incremental principle
D.	discounting principle
Answer» C. incremental principle

Discussion

30.	. for a product is a statement of the relation between the quantity supplied and all factors affecting that quantity
A.	market demand function
B.	production function
C.	market supply function
D.	all of the above
Answer» D. all of the above

Discussion

31.	When all the productive services are increased in a given proportion, the product is increased in the same proportion. This situation is called:
A.	Law of increasing
B.	Situation of constant returns
C.	Fixed cost
D.	Variable cost
Answer» C. Fixed cost

Discussion

32.	Consider a demand curve which takes the form of a straight line cutting both axes. Elasticity at the mid-point of the line would be:
A.	zero
B.	one infinite
C.	infinite
D.	cannot be calculated
Answer» C. infinite

Discussion

33.	Price discrimination occurs when variation in prices for a product in different markets does not reflect variation?
A.	Costs
B.	Price
C.	Demand
D.	All of these
Answer» B. Price

Discussion

34.	In .. approach, the demand for new product is estimated on the basis demand of existing product
A.	Growth curve approach
B.	Evolutionary approach.
C.	Opinion polling approach
D.	Vicarious approach.
Answer» C. Opinion polling approach

Discussion

35.	If the quantity of a commodity demanded remains unchanged as its price changes, the coefficient of price elasticity of demand is
A.	greater than 1
B.	equal to 1
C.	less than 1
D.	zero
Answer» E.

Discussion

36.	If the percentage increase in quantity of a commodity demanded is its price, the coefficient of price elasticity of demand is:
A.	greater than 1
B.	equal to 1
C.	less than 1
D.	zero
Answer» D. zero

Discussion

37.	______ is economic theory used in business whereas ______ is economics theory used in business and non-business organization
A.	micro economics, macro economics
B.	business economics, managerial economics
C.	positive economics and normative economics
D.	none of these
Answer» C. positive economics and normative economics

Discussion

38.	When the demand changes due to changes in other factors, like taste and preferences, income, price of related goods etc... , it is called
A.	Extension of demand
B.	Contraction of demand
C.	Shift in demand
D.	None of these
Answer» D. None of these

Discussion

39.	The change in demand due to change in price only, where other factors remaining constant, it is called .
A.	Shift in demand
B.	Extension of demand
C.	Contraction of demand
D.	Both extension and contraction
Answer» E.

Discussion

40.	forecasting is more important from managerial view point as it helps the management in decision making with regard to the firms demand and production.
A.	Macro level
B.	Industry level
C.	Firm level
D.	None of these
Answer» D. None of these

Discussion

Explore topic-wise MCQs in Bachelor of Business Administration (BBA).

The famous book on economics An Enquiry into the Nature and Cause of Wealth of Nation was written by

.. principle is closely related to the marginal costs and marginal revenue of economic theory

What effect is working when the price of a good falls and consumers tend to buy it insteadof other goods

Analysis of long run and short run affects of decisions on revenue as well as costs is bas ed on

If the income and substitution effect of a price increase works in the same direction the good whose price has changed is a

.is economic theory used in business whereas .is economics theory used in business and non business organization

means an attempt to determine the factors affecting the demand of a commodity or service and to measure such factors and their influences

When an individual s income falls (while everything else remains the same), his demand for an inferior good:

demand forecasting is prepared by different trade association in order to estimate the demand for particular industries products

a statement in the form of a table that shows the different quantities of a commodity that a firm or a producer offers for sale in the market at different prices.

The change in demand due to change in price only, where other factors remaining constant, it is called .

. means an attempt to determine the factors affecting the demand of a commodity or service and to measure such factors and their influences

A fall in the price of a commodity whose demand curve is a rectangular hyperbola causes total expenditure on the commodity to:

The claim that, other things equal, the quantity supplied of a goods rises when the price of goods raises known as:

The proportionate change in the quantity demanded of a commodity in response to change in the price of another related commodity is called

Law of demand shows the functional relationship between _______ and quantity demanded

The competitive firm s long run supply curve is the portion of it s ..curve lies above average total cost.

..is the process of finding current values of demand for various values of prices and other determining variables.

A demand curve which takes the form of horizontal line parallel to quantity axis illustrates elasticity which is:

In .approach, Consumers reactions on the new products are found out indirectly with the help of specialized dealers

In approach, on the basis of the growth of an established product, the demand for the new product is estimated

.. is the change in total revenue irrespective of changes in price or due to the effect of managerial decision on revenue

.. a schedule that depicts the supply by an individual firm or producer of a commodity in relation to its price

A graph indicating different combination of inputs with different level of output is called

Marginal revenue is .at the quantity that generate maximum total revenue and negative beyond that point.

Under which method, the cost is added with the predetermined target rate of return on capital invested

refers to the quantity of a good or service that producers are willing and able to sell during a certain period under a given set of conditions

Higher the price of certain luxurious articles, higher will be the demand, this concept is called

An input should be so allocated that the value added by the last unit is the same in all cases.

. for a product is a statement of the relation between the quantity supplied and all factors affecting that quantity

When all the productive services are increased in a given proportion, the product is increased in the same proportion. This situation is called:

Consider a demand curve which takes the form of a straight line cutting both axes. Elasticity at the mid-point of the line would be:

Price discrimination occurs when variation in prices for a product in different markets does not reflect variation?

In .. approach, the demand for new product is estimated on the basis demand of existing product

If the quantity of a commodity demanded remains unchanged as its price changes, the coefficient of price elasticity of demand is

If the percentage increase in quantity of a commodity demanded is its price, the coefficient of price elasticity of demand is:

______ is economic theory used in business whereas ______ is economics theory used in business and non-business organization

When the demand changes due to changes in other factors, like taste and preferences, income, price of related goods etc... , it is called

The change in demand due to change in price only, where other factors remaining constant, it is called .

forecasting is more important from managerial view point as it helps the management in decision making with regard to the firms demand and production.

is economic theory used in business whereas is economics theory used in business and non-business organization