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FINALTERM EXAMINATION
FALL 2006 Marks: 60
ECO402 - MICROECONOMICS (Session - 3 ) Time: 120min
StudentID/LoginID: ______________________________
Student Name: ______________________________
Center Name/Code: ______________________________
Exam Date: Thursday, February 01, 2007
INSTRUCTIONS:
Please read the following instructions carefully before attempting any question:
• All questions are compulsory.
• This exam consists of 15 Multiple Choice Questions (MCQ’s) carrying 1 mark

each,5 fill in the blanks carrying 1 mark each,5 true false carrying 1 mark each, 5
Short questions carrying 3 marks each and 2 Descriptive questions carrying 10
marks each.
• For each Multiple Choice Question, read the options available and select which
you consider is correct option.
• You are required to show all the working of short questions as well as Descriptive
question.
• This examination is closed book, closed notes and closed neighbors.
• Do not ask any questions about the contents of this examination from anyone.
• You may wish to pace yourself with your own watch, but the Supervisor will be the
official timekeeper of the test.
• Failure to comply with the Supervisor’s directions will result in your test being
cancelled. Please comply with supervisor’s directions to avoid any unpleasant
event.
For Teacher's use only

Question 1 2 3 4 5 6 7 8 9 10 Total
Marks
Question 11 12 13 14 15 16 17 18 19 20
Marks
Question 21 22 23 24 25 26 27 28 29 30
Marks
Question 31 32
Marks
Question No: 1 ( Marks: 1 ) - Please choose one
Compared to the equilibrium price and quantity sold in a competitive market, a monopolist
will charge a ______________ price and sell a ______________ quantity.
► Higher; larger
► Lower; larger
► Higher; smaller
► All of the given options
The total cost (TC) of producing computer software diskettes (Q) is given as: TC = 200 +
5Q. What is the marginal cost?
► 200
► 5Q
► 5
► 5 + (200/Q)
Marginal profit is equal to:
► Marginal revenue minus marginal cost.
► Marginal revenue plus marginal cost.
► Marginal cost minus marginal revenue.
► Marginal revenue times marginal cost.
An improvement in technology would result in:
► Upward shifts of MC and reductions in output.
► Upward shifts of MC and increases in output.
► Downward shifts of MC and reductions in output.
►
Downward shifts of MC and increases in output.
An increasing-cost industry is so named because of the positive slope of which curve?
► Each firm's short-run average cost curve
► Each firm's short-run marginal cost curve
► Each firm's long-run average cost curve
► The industry's long-run supply curve

As the manager of a firm you calculate the marginal revenue is $152 and marginal cost is
$200. You should:
► Expand output.
► Do nothing without information about your fixed costs.
► Reduce output until marginal revenue equals marginal cost.
► Expand output until marginal revenue equals zero.
The _____ elastic a firm's demand curve, the greater its _____:
► Less; monopoly power
► Less; output
► More; monopoly power
► More; costs
An electric power company uses block pricing for electricity sales. Block pricing is an
example of:
► First-degree price discrimination.
► Second-degree price discrimination.
► Third-degree price discrimination.
► Block pricing is not a type of price discrimination.

The maximum price that a consumer is willing to pay for each unit bought is the
______________ price:
► Market
► Reservation
► Consumer surplus
► Auction
When a company introduces new audio products, it often initially sets the price high and
about a year later it lowers the price. This is an example of:
► A two-part tariff.
► Second-degree price discrimination.
► Intertemporal price discrimination.
► First-degree price discrimination.
The market structure in which there is interdependence among firms is:
► Monopolistic competition.
► Oligopoly.
► Perfect competition.
►
Monopoly.
In the long run, the monopolistically competitive firm earns zero economic profit because:
► Of free entry and exit.
► It has excess capacity.
► It has the ability to set price.
► Other firms produce a perfect substitute.
Indifference curves are convex to the origin because of:
► Transitivity of consumer preferences.
► The assumption of a diminishing marginal rate of substitution.
► The assumption that more is preferred to less.
► The assumption of completeness.
Which of the following is true regarding income along a price consumption curve?
► Income is increasing.
► Income is decreasing.
► Income is constant.
► The level of income depends on the level of utility.
A supply curve reveals:
► The quantity of output consumers are willing to purchase at each possible market
price.
► The difference between quantity demanded and quantity supplied at each price.
► The maximum level of output an industry can produce, regardless of price.
► The quantity of output that producers are willing to produce and sell at each
possible market price.
Discrimination based upon the quantity consumed is referred to as second degree price
discrimination.
► True
► False
Restricted entry is another characteristic of monopolistic competition.
► True
► False
In a perfectly competitive labor market, a firm hires labor until the marginal revenue product of
labor equal the wage rate.
► True
► False
According to kinked-demand-curve model, oligopolists match price cuts and price increases.
► True
► False
The shut down point for the firm is where price equals average cost.
► True
► False
Question No: 21 ( Marks: 1 )
Each seller has a very small share of the market in the ______________.
Total revenue = ______________.
In long-run equilibrium, economic profits are _____________.
Many countries use ___________and ____________to keep the domestic price of a product above
world levels.
Government intervention without a market failure creates __________.
How oligopoly is different from perfect competition, monopoly and monopolistically

competitive market?
Differentiate between consumer surplus and producer surplus.

If the elasticity of demand for the product is –2, find the marginal cost of the last unit
produced.
When do competitive markets generate an inefficient allocation of resources or market

failure? How can be the efficiency of these markets increased?
How can monopoly power of a monopolist be measured? What is the basic incentive behind
monopoly power?
Examine this information for a monopoly product.
Price ($) Quantity

10 1,000
8 2,000
6 3,000
4 4,000
2 5,000
.50 6,000
(a) Calculate total revenue.

(b) Calculate marginal revenue.
(c) What is the maximum output that the producer of this product would ever produce?
(d) Why would this firm never produce more than the output amount in part c?
(3+3+2+2)
a. Define demand curve. Briefly explain non price determining variables of

demand. (2+4)
b. If the market price is above and below the equilibrium level how will market
adjust to reach the equilibrium point? (2+2)
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ECO402 Microeconomics
Final Term Examination – Spring 2005
Time Allowed: 150 Minutes
INSTRUCTIONS:
All questions are compulsory.

This exam consists of 5 Multiple Choice Questions (MCQ's) and 5 descriptive
questions.
Each MCQ carries 2 Marks each and Descriptive Questions carry 10 Marks each.
You should try to complete MCQ's in 10 - 15 minutes in order to give yourself 135 -
140 minutes for descriptive questions.
For each MCQ question, read the choices available and select the choice which you
consider is the correct answer, by clicking on the appropriate check box.
Save your answer before proceeding to the next question.
Do not click the "Finish button" while solving your paper. Once you clicked the
"Finish" button, you will not be able to access your paper again. Click it at the end of
your paper. That means you have submitted your complete paper.
A clock is given in the exam software. Software will automatically be closed at the end
of 90 minutes.
Remember not to spend too much time on any one MCQ. Since all MCQ's carry equal
marks, it is important to manage your time and responses to test questions effectively.
Failure to comply with the Supervisor's directions will result in your test being
cancelled. Please comply with supervisor's directions to avoid any unpleasant event.
Total Marks: 60 Total Questions: 10
Question No. 1 Marks : 10

Suppose that you are the manager of watch making firm operating in a
competitive market your cost of production is given by C = 100 +Q2 , where
Q is the level of output and C is total cost. The marginal cost of
production is 2Q .The fixed cost of production is $100. If the price of
watches is $ 60, how many watches should you produce to maximize
profit?
The kink in the kinked demand curve arises because:

o there is a sharp, abrupt change in the price elasticity of demand
o entry into the industry is relatively easy
o monopoly profits are being made by some firms but not by
others
o the products sold by each firm are different
Can perfectly competitive firms earn economic profit? Explain.
When an industry is classified as oligopolistic, it consists of:
o only one seller

o many sellers with similar products
o only a few sellers with either standardized or differentiated
products
o only a few buyers
Suppose that the market demand function of a perfectly competitive

industry is given by QD = 4,750 – 50P and the market supply function is
given by QS = 1,750 +50P, and P is expressed in dollars. Find the market
equilibrium price.
In the short run, the supply curve for a perfectly competitive industry:
o shifts to the right if new firms enter the industry

o is the sum of all individual firms' average total cost curves
o is horizontal
o does not change if firms leave the industry
Do you agree or disagree with each of the following statement. Explain

your reasons.
(a) Average fixed cost does not change as the output change.
(b) Firms will never sells its product for less than it costs to produce
it.
When the monopolistic producer practices price discrimination:
o different prices are used to ration different goods among

different consumers
o different groups of consumers are charged different prices for
the same good
o social welfare is improved
o all consumers are charged different prices for different goods
A sales tax of $1 per unit of output is placed on one firm whose product
sells for $5 in a competitive industry.
(a) How will this tax affect the cost curves for the firm?
(b)Will there be entry or exit?
The monopolistic producer:
o is not concerned with the cost of production since higher cost

can be passed on to consumers
o tries to maximize total revenue
o usually produces in the inelastic range of the demand curve
o tries to minimize the cost of producing a given level of output
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Final Term Examination – Spring 2006
Question No. 1 Marks :1
Economies of scale and economies of scope are synonymous.

True
False
Refer to the graph below. The marginal revenue curve is represented by curve:
A
B
C
D
Government intervention without market failure creates________________.

Question
tion No. 4 Marks : 1
If the market supply of labor increased relative to demand (baby boomers or

female entry), a surplus of labor would exist and the wage rate would:
Fall
Rise
No effect
All of the given options
State the main consequence of product differentiation? Write down the characteristics
of monopolistic competition.
Diminishing returns to labor occur at the ______________ unit of input:
7th
2nd
5th
4th
Monopoly can charge any price that it wishes regardless to the market trend
or the demand for the good.
True
False
The short run supply curve of a monopolist is:
The rising portion of the MC curve,

The rising portion of the MC curve above AVC,
The rising portion of the MC curve above AC,
None of the given option.
Total profit= Total revenue ________________.
Opportunity cost, most broadly defined, is:

The additional cost of producing an additional unit of output,
What we forgo, or give up, when we make a choice or a decision,
A cost that cannot be avoided, regardless of what is done in the future,
The additional cost of buying an additional unit of a product,
Question No. 11 Marks :

10
Define oligopoly. How oligopoly market equilibrium is different from perfect

competition and monopolistic competition?
How is oligopoly different from?
a) Perfect competition?
b) Monopolistic competition?
c) Monopoly?
The MRP for firms with market power is equal to:

MP x W
MP x MR
MP x P
MP x MC

3
Define price discrimination. Why 1st degree price discrimination is practically difficult?
Which of the following characteristics is common to both perfect competition

and monopolistic competition?
Average total cost is minimized in the long run.
Marginal revenue equals price.
Economic profits are zero in the long run.
Price equals marginal cost.

The price of a good is $100, and the marginal cost of the good is $90. A
competitive firm should produce that unit.
True
False
Slope of total revenue is ________________.

One characteristic often seen in real world oligopolies is:
Fluctuating prices.
Zero economic profit.
Low barriers to entry.
Price rigidity.
What type of difference is shown by economic rent?
Different combinations of labor and capital that have the same total costs can
be shown by a(n):
Isoquant line
Isocost line
Production function.
Total cost curve.
In an oligopoly, there are only a few firms and a firm can control price,
regardless of the actions of other firms in the industry.
True
False
If factor prices rise as industry output expands in the long run, we have:
A constant-cost industry,
A decreasing-cost industry,
An increasing cost industry,
Any of the given option

The difference between what consumer is willing to pay for an item and what he actually
pays is called ______________.
Demand for a product is elastic when:

A fall in the price of the product causes total expenditures by consumers on the product to
fall
The percentage change in quantity demanded equals the percentage change in price.
Total expenditures by consumers for the product increase when the product's price falls.
A fall in the price of the product does not affect the firm's revenue.

10
Use the table below to answer the following questions.
# of Total Product Marginal Average

Workers Product Product
per day
0 0
1 4
2 10
3 18
4 22
5 24
6 22
a) Fill in the table above.
b) At what point (number of workers) does the firm experience diminishing

returns? Explain.
The total variable costs of producing no output are:

0
100
400
Incalculable from the information given in this question.
3
Differentiate between Natural monopoly and artificial monopoly?
Who lose from import quotas?

Consumers of imported goods.
Consumers of exported goods.
Producers of imported goods.
Firms that hold import licenses.
OPEC is best example of cartel:

True
false
______________________measures the percentage change in quantity demanded

resulting from a one percent change in income.
A monopsony is a situation where there is a (n):

Single buyer.
Single seller.
Oligopoly.
Competitor with a monopolist.
Differentiate between import tariff and import quotas?
The general shape of the marginal cost curve is that it ______________ and
then ________________:
is horizontal, declines
is horizontal, rises
rises, declines
declines, rises
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MIDTERM EXAMINATION
FALL 2006 Marks: 40
Student Name: ______________________________
Center Name/Code: ______________________________
Exam Date: Wednesday, November 22, 2006
• This exam consists of 10 Multiple Choice Questions (MCQ’s) carrying 1 mark

each,5 fill in the blanks carrying 1 mark each, 5 Short questions carrying 3 marks
each and 1 Descriptive questions carrying 10 marks.
• You are required to show all the working of short questions as well as Descriptive
question.
• This examination is closed book, closed notes, closed neighbors.
• Use of calculator is allowed in the examination.
• Do not ask any questions about the contents of this examination from anyone.
• You may wish to pace yourself with your own watch, but the Supervisor will be the
• Failure to comply with the Supervisor’s directions will result in your test being
event.
Question 1 2 3 4 5 6 7 8 9 10 Total
Marks
Question 11 12 13 14 15 16 17 18 19 20
Marks
Question 21
Marks
Alvin's preferences for good X and good Y are shown in the diagram below.
Based on given Figure, it can be inferred that:
► Alvin does not consider good X as "good."
► Alvin will never purchase any of good Y.
► Alvin regards good X and good Y as perfect substitutes.
► Alvin regards good X and good Y as perfect complements.
An increase in income, holding prices constant, can be represented as:

► A change in the slope of the budget line.
► A parallel outward shift in the budget line.
► An outward shift in the budget line with its slope becoming flatter.
► A parallel inward shift in the budget line.
The short run, as economists use the phrase, is characterized by:
► A period where the law of diminishing returns does not hold.
► At least one fixed factor of production, and firms neither leaving nor
entering the industry.
► All inputs being variable.
► No variable inputs - that is all of the factors of production are fixed.
Which of the following inputs are variable in the long run?
► Labor.
► Capital and equipment.
► Plant size.
► All of the given options.

An isoquant:
► Must be linear.
► Cannot have a negative slope.
► Is a curve that shows all the combinations of inputs that yield the
same total output.
► Is a curve that shows the maximum total output as a function of

the level of labor input.
Coffee and cream:
► Are both luxury goods.
► Are complements.
► Are both more inelastic in demand in the long run than in the
short run?
► Have a positive cross price elasticity of demand.
Although there are many reasons why a market can be non-competitive, the
principal economic difference between a competitive and a non-competitive market
is:
► The number of firms in the market.
► The extent to which any firm can influence the price of the product.
► The size of the firms in the market.
► The annual sales made by the largest firms in the market.
The theory of consumer behavior is based on certain assumptions. It includes at

least the assumption(s) that preferences are:
► Complete.
► Transitive.
► Intransitive.
► Complete and Transitive.
Which of following is a key assumption of a perfectly competitive market?
► Firms can influence market price
► Commodities have few sellers
► It is difficult for new sellers to enter the market.
► Each seller has a very small share of the market.
What does it mean when the consumer price index CPI is higher this year than
last?
► The rate of inflation has increased.
► There has been inflation since last year.
► Real prices have increased.
► Real prices have decreased.
Two goods are considered ______________if an increase (decrease) in the price of one
leads to an increase (decrease) in the quantity demanded of the other.
Shape of isoquant is______________.
_____________ = TFC/Q + TVC/Q.
In _________________increase in output is greater than the increase in inputs.
The marginal rate of technical substitution (MRTS) is ___________at all points on the
isoquant.
What are the advantages of joint production?
Define isocost line. What is the slope of isocost line?

Differentiate between increasing returns to cost and decreasing returns to cost.
If there is 10% chance of a $10,000 loss from a home burglary, what will be the
expected loss?
Differentiate between positive and negative network externalities.
a. Differentiate b/w elasticity of demand and supply with the help of formula.
b. Calculate income elasticity of demand with the help of example.

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Mid Term Examination – Spring 2006
INSTRUCTIONS:
• This exam consists of 10 Multiple Choice Questions (MCQ’s) carrying 1

mark each,5 fill in the blanks carrying 1 mark each, 5 Short questions
carrying 3 marks each and 1 Descriptive questions carrying 10 marks.
• You are required to show all the working of short questions as well as
Descriptive question.
• This examination is closed book, closed notes, closed neighbors.
• Do not ask any questions about the contents of this examination from
anyone.
• You may wish to pace yourself with your own watch, but the Supervisor will
be the official timekeeper of the test.
Failure to comply with the Supervisor’s directions will result in your test being
event.
Which best expresses the law of demand?

A higher price reduces demand
A lower price reduces demand
A higher price reduces quantity demanded
A lower price shifts the demand curve to the right
If a consumer starts in equilibrium in their consumption of apples and chocolate bars,

and the price of apples rises, what will happen to the quantity demanded of apples, and
why?
_____________is the additional utility gained from consuming one extra unit of a good or
service.
A firm will earn an economic profit if:
Its total sales revenue equals the cost of labor and raw materials
It produces its output utilizing the least-cost production method
It is regulated by government
Its total sales revenue exceeds the sum of all its economic costs
a). Define equilibrium.
b). If
– QS = 1,800 + 240P
– QD = 3,550 - 266P
Find out the equilibrium quantity and price. Also find out the elasticity of
demand and supply and show that elasticities are elastic or inelastic?
A market is characterized by:
Either down sloping demand or up sloping supply but not both

The exchange of goods and services, but not resources
Exchange between buyers and sellers
Face-to-face contact between buyers and sellers
The_________________shows how much firms wish to sell at different prices.
Two variables have a positive relationship if ___________________:
They move in opposite directions

They move in the same direction
One decreases when the other increases
One increases when the other decreases
What does production possibility frontier show?
The numerical measurement of a consumer’s preference is called_______________:
Satisfaction
Use
Pleasure
Utility
Does the Laspeyres index always overstate the true cost of living index?
The two main branches of economics are _____________ and____________.
Profit is maximized at that point where total revenue is equal to--------------------_
If the supply of a product decreases and the demand for that product simultaneously
increases, then equilibrium:
Price must rise

Price must fall
Quantity must rise
Quantity must fall
Define elasticity. In which case elasticity is greater than 1?
Suppose that a 2% increase in income in the economy decreases the quantity demandedof
gadgets by 1% at every possible price. This implies that:
The supply of gadgets is elastic

Income elasticity is positive and gadgets are a normal good
Income elasticity is negative and gadgets are a normal good
Income elasticity is negative and gadgets are an inferior good
Moving from left to right, the typical production possibilities curve has:
an increasingly steep negative slope

a decreasingly steep negative slope
an increasingly steep positive slope
a constant and negative slope
The price elasticity of demand measures the responsiveness of quantity demanded

to_____________.
Microeconomics:
Is particularly subject to the "fallacy of composition"

Is concerned with the economy as a whole
Studies how supply and demand determine prices in individual markets
Describes the aggregate flows of output and income
When movie ticket prices increase, families tend to spend more time at home watching
videos instead. This best reflects:
Diminishing marginal utility

The income effect
The rationing function of markets
The substitution effect
Define supply curve. What is the relationship between price and quantity supplied?
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MIDTERM EXAMINATION
SPRING 2007 Marks: 40
Student Name: ______________________________
Center Name/Code: ______________________________
Exam Date: Saturday, May 12, 2007
All questions are compulsory.
This exam consists of 10 Multiple Choice Questions (MCQs) of 1 mark each, 5 fill in
the blanks of 1 mark each, 3 Short questions of 5 marks each and one Descriptive
question of 10 marks.
For each Multiple Choice Question, read the options available and select which you
consider are the correct one.
You are required to show all the working of short as well as practical question.
Use of calculator is allowed.
This examination is closed book, closed notes and closed neighbors.
Do not ask question about the contents of this examination from anyone.
You may wish to pace yourself with your own watch, but the Supervisor will be the
Failure to comply with the Supervisor’s directions will result in your test being
cancelled. Please comply with supervisor’s directions to avoid any unpleasant event

Question 1 2 3 4 5 6 7 8 9 10 Total
Marks
Question 11 12 13 14 15 16 17 18 19
Marks
Question
Marks
What does it mean when the consumer price index (CPI) is higher this year than
last?
► The rate of inflation has increased.
► There has been inflation since last year.
► Real prices have increased.
► Real prices have decreased.
Which of the following is NOT an assumption regarding people's preferences in the

theory of consumer behavior?
► Preferences are complete.
► Preferences are transitive.
► Consumers prefer more of a good to less.
► None of the given options.
If indifference curves cross, then:
► The assumption of a diminishing marginal rate of substitution is violated.
► The assumption of transitivity is violated.

► The assumption of completeness is violated.
► Consumers minimize their satisfaction.
Which of the following is true concerning the income effect of a decrease in price?
► It will lead to an increase in consumption only for a normal good.
► It always will lead to an increase in consumption.
► It will lead to an increase in consumption only for an inferior good.
► It will lead to an increase in consumption only for a Giffen good.
Assume that two investment opportunities have identical expected values of

$100,000. Investment A has a variance of 25,000, while investment B's variance is
10,000. We would expect most investors (who dislike risk) to prefer investment
opportunity
► A because it has less risk.
► A because it provides higher potential earnings.
► B because it has less risk.
► B because of its higher potential earnings.

When the average product is decreasing, marginal product
► Equals average product.
► Is increasing.
► Is decreasing.
► Is less than average product.
The law of diminishing returns applies to
► The short run only.
► The long run only.
► Both the short and the long run.
► Neither the short nor the long run.
The rate at which one input can be reduced per additional unit of the other input,
while holding output constant, is measured by the
► Marginal rate of substitution.
► Marginal rate of technical substitution.
► Slope of the isocost curve.
► Average product of the input.

Fixed costs are fixed with respect to changes in
► Output.
► Capital expenditure.
► Wages.
► Time.
The diagram below contains _____ cost curves.
► short run
► Intermediate run
► long run
►
Both short run and long run.
The _____________shows the possible combination of goods and services available in

an economy.
Generally ________is a measure of the sensitivity of one variable to another.
A ____________indicates all combinations of two commodities for which total money

spent equals total income.
The market demand will shift to the_______ as more consumers enter the market.
Actual expenses plus depreciation charges for capital equipment is known

as______________.
Define utility. Differentiate between ordinal and cardinal utility function; which one
is better? (1+3+1)
(a) Differentiate between risk averse and risk loving people.

(b) How consumer can attempt to reduce risk? (3+2)
a. Define elasticity of demand. What are the two extreme case of elasticity of
demand?
b. Define cross elasticity of demand; also write down its formula. What will be
the cross elasticity of demand for substitutes and for complements. (2+3)
Define a market basket.Onwhich assumptions consumers preferences are based?

Why an indifference curve is convex to origin.(2+6+2)

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Student Name: ______________________________

Center Name/Code: ______________________________

Exam Date: Thursday, February 01, 2007

• All questions are compulsory.

• This exam consists of 15 Multiple Choice Questions (MCQ’s) carrying 1 mark

• This examination is closed book, closed notes and closed neighbors.

For Teacher's use only

Question No: 1 ( Marks: 1 ) - Please choose one

► All of the given options

Question No: 2 ( Marks: 1 ) - Please choose one

Marginal profit is equal to:

► Marginal revenue minus marginal cost.

► Marginal revenue plus marginal cost.

► Marginal cost minus marginal revenue.

► Marginal revenue times marginal cost.

Question No: 4 ( Marks: 1 ) - Please choose one

An improvement in technology would result in:

► Upward shifts of MC and reductions in output.

► Upward shifts of MC and increases in output.

► Downward shifts of MC and reductions in output.

Question No: 5 ( Marks: 1 ) - Please choose one

An increasing-cost industry is so named because of the positive slope of which curve?

► Each firm's short-run average cost curve

► Each firm's short-run marginal cost curve

► Each firm's long-run average cost curve

► The industry's long-run supply curve

Question No: 6 ( Marks: 1 ) - Please choose one

► Do nothing without information about your fixed costs.

► Reduce output until marginal revenue equals marginal cost.

► Expand output until marginal revenue equals zero.

Question No: 7 ( Marks: 1 ) - Please choose one

► Less; monopoly power

► More; monopoly power

Question No: 8 ( Marks: 1 ) - Please choose one

► First-degree price discrimination.

► Second-degree price discrimination.

► Third-degree price discrimination.

► Block pricing is not a type of price discrimination.

Question No: 9 ( Marks: 1 ) - Please choose one

Question No: 10 ( Marks: 1 ) - Please choose one

► Second-degree price discrimination.

► Intertemporal price discrimination.

► First-degree price discrimination.

Question No: 11 ( Marks: 1 ) - Please choose one

The market structure in which there is interdependence among firms is:

Question No: 12 ( Marks: 1 ) - Please choose one

► Of free entry and exit.

► It has excess capacity.

► It has the ability to set price.

► Other firms produce a perfect substitute.

Question No: 13 ( Marks: 1 ) - Please choose one

Indifference curves are convex to the origin because of:

► Transitivity of consumer preferences.

► The assumption of a diminishing marginal rate of substitution.

► The assumption that more is preferred to less.

► The assumption of completeness.

Question No: 14 ( Marks: 1 ) - Please choose one

Question No: 15 ( Marks: 1 ) - Please choose one

A supply curve reveals:

► The maximum level of output an industry can produce, regardless of price.

Question No: 16 ( Marks: 1 ) - Please choose one

Question No: 17 ( Marks: 1 ) - Please choose one

Restricted entry is another characteristic of monopolistic competition.

The rising portion of the MC curve,