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Business Economics > Chapter 3 (Theory Of Production And Cost) > Flashcards

Chapter 3 (Theory Of Production And Cost) Flashcards

1
Q

Command economy is found in _____ economic system.

  1. Capitalist
  2. Socialist
  3. Mixed
  4. None of the above
A
  1. Socialist
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2
Q

Land is _____ factor of production.

  1. Active
  2. Passive
  3. Both a & b
  4. None of the above
A
  1. Passive
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3
Q

Land supply is_____

  1. Perfectly Elastic
  2. Perfectly Inelastic
  3. Relatively elastic
  4. Relatively Inelastic
A
  1. Perfectly Inelastic
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4
Q

Labour means _____

  1. Physical exertion
  2. Mental exertion
  3. Exertion for consideration
  4. All of the above
A
  1. All of the above
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5
Q

Mixed economy_____

  1. Involvement of PSU
  2. Involvement of private company
  3. Both a & b
  4. None of the above
A
  1. Both a & b
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6
Q

Labour is _____

  1. Immobile
  2. Mobile
  3. None of the above
A
  1. Mobile
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7
Q

Labour is perishable in nature

  1. True
  2. False
A
  1. True
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8
Q

Factors of production_____

  1. Land
  2. Labour
  3. Capital
  4. Entrepreneur
  5. All of the above
A
  1. All of the above
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9
Q

Capital is a _____ concept

  1. Flow
  2. Stock
A

Stock

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10
Q

Goodwill is _____ kind of capital.

  1. Tangible capital
  2. Intangible capital
  3. Real capital
  4. Physical capital
A

Intangible capital

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11
Q

Working capital is also known as _____

  1. Fixed capital
  2. Circulating capital
  3. Tangible capital
  4. Intangible capital
A

Circulating capital

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12
Q

Capital is a _____ concept

  1. Stock concept
  2. Flow concept
  3. Bot A&B
  4. None of the above
A

Stock concept

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13
Q

“Function of entrepreneurs is to innovate” was said by

  1. Joseph schumpeter
  2. Frank knight
  3. Karl’s Marx
  4. Alfred Marshall
A

Joseph schumpeter

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14
Q

Law of variable proportion is used in _____

  1. Long run
  2. Medium run
  3. Short run
  4. All of the above
A

Short run

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15
Q

Capital is also known as

  1. Produced means of production
  2. Man made instruments of production
  3. Produced factors of production
  4. All of the above
A

All of the above

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16
Q

Circulating capital is also known as ______

  1. Real capital
  2. Single use capital
  3. Working capital
  4. Both B&C
A

Both B&C

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17
Q

“Profit is the reward for bearing uncertainties” was said by

  1. Joseph schumpeter
  2. Frederick Engels
  3. Frank night
  4. Karl Marx
A

Frank knight

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18
Q

Land is immobile in nature

True or False

A

True, because land can’t be shifted from one place to other

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19
Q

When AP=MP, MP is max

True of False

A

False, because when AP=MP;AP is max

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20
Q

AP is greater than MP in increasing returns

True or false

A

False, because in increasing returns MP>AP

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21
Q

In diminishing returns TP starts falling

True or false

A

True

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22
Q

When TP increases in an increasing rate

  1. Stage 1
  2. Stage 2
  3. Stage 3
A

Stage 1

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23
Q

When is point of inflexion

  1. When TP is max
  2. When AP is max
  3. When MP is max
  4. When TP is max and MP is zero
A

When MP is max, and it is just before the end of stage 1

24
Q

When MP is negative

  1. Stop production
  2. Produce more
  3. None
A

Stop production, because it leads to negative returns

25
Q

Law of variable proportion is used

  1. Short run
  2. Long run
A

Short run

26
Q

Iso quant curve gives us idea about combinations of

  1. Inputs
  2. Two products
A

Inputs, i.e.. Labour and capital

27
Q

Iso quant is also called as

  1. Equal cost curve
  2. Equal product curve
  3. Both A&B
  4. None of the above
A

Equal product curve

28
Q

When AP=MP

  1. AP is max
  2. MP is max
  3. App is min
  4. Both B&C
A

AP is max

29
Q

Iso cost line is almost known as

  1. Product indifference curve
  2. Production indifference curve
  3. Equal cost line
  4. All of the above
A

Equal cost line

30
Q

Increasing returns

  1. TP decreases
  2. TP increases
  3. TP is negative
  4. TP increases at increasing rate
A

TP increases at increasing rate

31
Q

Cost that can not be recovered

  1. Sunk cost
  2. Incremental cost
  3. Opportunity cost
  4. Non-traceable cost
A

Sunk cost

32
Q

Explicit cost is for self owned factors

  1. True
  2. False
A

False, because implicit cost is for self-owned factors

33
Q

_______ cost does not change with production

  1. Fixed cost
  2. Variable cost
  3. Opportunity cost
  4. Incremental cost
A

Fixed cost, because it is fixed

34
Q

LAC curve is also known as

  1. Planning curve
  2. Envelope curve
  3. Both A&B
  4. None of the above
A

Planning curve or envelope curve

35
Q

SAC curve includes all variable factors

  1. True
  2. False
A

True

36
Q

AVC & ATC are U-shaped curve

  1. True
  2. False
A

True

37
Q

TVC is S-shaped curve

  1. True
  2. False
A

True

38
Q

When AP and MP is equal

  1. AP is lowest
  2. AP is max
  3. MP is max
  4. AP & MP both max
A

AP is max

39
Q

The vertical difference between TC & TVC is

  1. TFC
  2. AFC
  3. AVC
  4. ATC
A

TFC

40
Q

Active factor of production

  1. Land
  2. labour
  3. capital
  4. all of the above
A

labour

41
Q

when income increases but demand for a product decreases

  1. luxury goods
  2. necessity goods
  3. medicines
  4. inferior goods
A

inferior goods

42
Q

goods which can be consumed only ones are called as

  1. durable
  2. non durable
  3. produced
  4. none
A

non durable

43
Q

when Apple and pineapple or substitute then increase in price of Apple leads to

  1. increase in price of pineapple
  2. decrease in price of pineapple
  3. increase in quantity of pineapple
  4. decrease in quantity of pineapple
A

Increase in quantity of pineapple

44
Q

Reliance industries incorporated in the year

  1. 1960
  2. 1966
  3. 1975
  4. 1981
A

1966

45
Q

when supply is increasing due to other factors

  1. increase in supply
  2. extension in supply
  3. expansion in supply
  4. all of the above
A

increase in supply

46
Q

Accounting cost is

  1. not recorded in books of accounts
  2. recorded in books of accounts
  3. similar of implicit cost
  4. B&C of above
A

recorded in books of accounts

47
Q

Supply is

  1. stock concept
  2. flow concept
A

flow concept

48
Q

Yield on capital is

  1. stock concept
  2. flow concept
A

flow concept

49
Q

Yield on capital is

  1. stock concept
  2. flow concept
A

flow concept

50
Q

capital is

  1. stock concept
  2. flow concept
A

stock concept

51
Q

horizontal curve

  1. e=1
  2. e>1
  3. e<1
  4. e= ♾️
A

e = ♾️

52
Q

Fortune 500 company rank 1

  1. Reliance
  2. Adani
  3. walmart
  4. apple
A

walmart

53
Q

in very short period supply

  1. can be changed
  2. can’t be changed
A

can’t be changed

54
Q

when I purchase Matchbox increase in price of Matchbox is going to have

  1. more elastic
  2. less elastic
A

less elastic

55
Q

when there are many substitute elasticity is

  1. e = 1
  2. e > 1
  3. e < 1
  4. e=0
A

e > 1

Business Economics (4 decks)

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