Maximum Mark-50 Question 1) Indifference curve approach is the contribution of ? Answers Option 1 Alfred Marshall Option 2 Lionel Robins Option 3 JR Hicks Option 4 PA Samuelson Question 2) What is the slope of the budget line if, price of good 1 is ₹10 and price of good 2 is ₹5 ? Answers Option 1 -2 Option 2 10 Option 3 5 Option 4 -.2 Question 3) Identify the nature of demand curve when elasticity of demand is equal to 1 ? Answers Option 1 Parallel to x axis Option 2 Parallel to y axis Option 3 Rectangular hyperbola Option 4 None of these Question 4) A fall in the price of a commodity, holding everything else constant, results an increase in demand and is referred to as ? Answers Option 1 Increase in demand Option 2 Contraction in demand Option 3 Decrease in demand Option 4 Expansion in demand Question 5) What is the price elasticity of demand if, there is no change in expenditure as a result of change in price ? Answers Option 1 O Option 2 >1 Option 3 <1 Option 4 = 1 Question 6) Consider the equation y = f (x), then the variable Y is?. Answers Option 1 Exogenous Option 2 Independent Option 3 Dependent Option 4 Unpredictable Question 7) Which of the following is the most important determinant of demand? Answers Option 1 Income Option 2 Price Option 3 Tastes and Preferences Option 4 Climate Question 8) In the given budget line equation 5X1 + 2X2 = 20, what is the vertical intercept ? Answers Option 1 5 Option 2 2 Option 3 7 Option 4 10 Question 9) A collection of indifference curves is called Answers Option 1 Demand Option 2 Budget line Option 3 Equilibrium Option 4 Indifference map Question 10) Mr. A consumes two fruits : Apple and Orange. He has monotonic preference, which implies that: Answers Option 1 He prefers a bundle with more apple and orange Option 2 He prefers a bundle with less quantity of both the fruits Option 3 He prefers a bundle with more of at least one of the fruits and no less of the other Option 4 He prefers no specific bundle Question 11) Pick out the correct equation for showing consumer's budget constraint ? Answers Option 1 P1X1 + P2X2 = M Option 2 P1X1 + P2X2 ≤ M Option 3 P1X1 + P2X2 ≥ M Option 4 P1X1 + P2X2 > M Question 12) The name given to the commodities using together ? Answers Option 1 Complimentary goods Option 2 Substitutable goods Option 3 Inferior good Option 4 Normal good Question 13) Want satisfying power of a commodity is called ? Answers Option 1 Want Option 2 Demand Option 3 Utility Option 4 Value Question 14) When the income of the consumer was ₹500, he buys 4kg of good y. His income increased by ₹100, then he reduced the consumption of good y by 2 units. What is the type of good y ? Answers Option 1 Substitutable good Option 2 Inferior good Option 3 Luxury goods Option 4 Normal good Question 15) Price of a commodity increased from 10 to 15, as a result quantity demanded decreased from 100 to 75. What is the value of elasticity? Answers Option 1 5 Option 2 .5 Option 3 15 Option 4 10 Question 16) What is called if demand increases as a result of decrease in price ? Answers Option 1 Contraction in demand Option 2 Decrease in demand Option 3 Expansion in demand Option 4 Increase in demand Question 17) Elasticity in a rectangular hyperbola type demand curve will be ? Answers Option 1 >1 Option 2 1 Option 3 .1 Option 4 < Question 18) In the given equation q= a-bp, slope is represented by? Answers Option 1 p Option 2 b Option 3 -b Option 4 a Question 19) Slope of a IC is represented by ? Answers Option 1 DMU Option 2 DMRS Option 3 Price ratio Option 4 None of these Question 20) Suppose a consumer's preferences are monotonic, which among the following bundles consumer will select ? Answers Option 1 (2,1) Option 2 (1,1) Option 3 (2,2) Option 4 (2,3) Question 21) In drawing an individual demand curve, all but one of the following are kept constant ? Answers Option 1 Income of the consumer Option 2 Price of the commodity Option 3 Price of related question Option 4 Tastes and preferences Question 22) Which of the following goods has more elastic demand ? Answers Option 1 Rice Option 2 Computer Option 3 Life saving medicine Option 4 Electricity Question 23) Find the odd one out Answers Option 1 Tea and Coffee Option 2 Bread and Jam Option 3 Car and Petrol Option 4 Sugar and Tea Question 24) In the below given diagram, movement of budget line from AB to AB1 is due to Answers Option 1 Decrease in the price of good 1 Option 2 Decrease in the price of good 1 Option 3 Increase in the price of good 2 Option 4 Decrease in the price of good 2 Question 25) A demand curve is given, in which identify elasticity at point 'M' Answers Option 1 1 Option 2 >1 Option 3 <1 Option 4 0 Question 26) The relationship between demand and determinants of demand is called Answers Option 1 Demand Option 2 Utility function Option 3 Demand function Option 4 Price function Question 27) Change in demand caused by change in price is called Answers Option 1 Income effect Option 2 Price effect Option 3 Demand effect Option 4 Law of demand Question 28) In the below diagram identify point 'C' Answers Option 1 Under utilisation Option 2 Preferred bundle Option 3 Inferior bundle Option 4 Equal satisfaction Question 29) The rate at which one good is substituted for another is called Answers Option 1 Substitution effect Option 2 Rate of substitution Option 3 Budget line Option 4 None of these Question 30) A linear demand equation is given as q = a - bp. Here , if price = 0 then demand will be Answers Option 1 -b Option 2 b Option 3 q Option 4 a Question 31) In the below diagram , movement of demand curve from DD to D1D1 is due to Answers Option 1 Increase in demand Option 2 Decrease in demand Option 3 Expansion in demand Option 4 Contraction in demand Question 32) The concept ' elasticity ' is first introduced by economist Answers Option 1 Adam Smith Option 2 JM Keynes Option 3 Alfred Marshal Option 4 David Ricardo Question 33) Two individual demand curves are give as q1 = 20 - p and q2 = 10 - 2p, then the market demand equation (Dm) will be Answers Option 1 30 + 2p Option 2 30 - 2p Option 3 30 - 3p Option 4 30 + 3p Question 34) In the below given indifference curve, when comparing point D with any point in the IC, point D represents Answers Option 1 Monotonic preference Option 2 Inferior bundle Option 3 Equal preference Option 4 None of these Question 35) In the equation , q = 10 - 2p, if price is given as 3. What will be the quantity demanded? Answers Option 1 7 Option 2 12 Option 3 15 Option 4 4 Question 36) A consumer can afford to buy 6 units of good 1 and 8 units of good 2 if the consumer spends his entire income. The prices of two goods are ₹6 and ₹8 respectively. How much will be the income of the consumer? Answers Option 1 36 Option 2 14 Option 3 48 Option 4 100 Question 37) A graph is given below, in which point E represents Answers Option 1 Optimum bundle Option 2 Equilibrium Option 3 Maximum satisfaction Option 4 All of the above Question 38) In the below given diagram, points,point C and D does not indicate equilibrium because Answers Option 1 They are not tangent at mid point of budget line Option 2 IC cuts budget line Option 3 Slope of the budget line and IC are not same Option 4 None of these Question 39) From the below equations, which equation represents budget constraint Answers Option 1 P1X1 + P2X2 = M Option 2 P1X1 + P2X2 > M Option 3 P1X1 + P2X2 < M Option 4 P1X1 + P2X2 ≤ M Question 40) Representation of preferences in terms of utility numbers is called Answers Option 1 Demand function Option 2 Equilibrium Option 3 Utility function Option 4 Preferences of the consumer Question 41) Cardinal approach was put forwarded by Answers Option 1 Adam Smith Option 2 JR Hicks Option 3 Alfred Marshal Option 4 PA Samuelson Question 42) As we consume more and more unit of a same commodity the utility derived from the subsequent units diminishes. This is called Answers Option 1 Law of Demand Option 2 Law of Diminishing Marginal Utility Option 3 Law of utility Option 4 None of the above Question 43) Watch the below given diagram. In the diagram, movement from A to B is called Answers Option 1 Increase in demand Option 2 Decrease in demand Option 3 Expansion in Demand Option 4 Contraction in demand Question 44) Find the odd one Answers Option 1 Doctor Option 2 Lawyer Option 3 Farmer Option 4 Teacher Question 45) A linear demand function is represented by q = a -bp. The value of a, b and p are given as 50, 15 and 2 respectively. What is the quantity demanded (q)? Answers Option 1 20 Option 2 50 Option 3 100 Option 4 30 Question 46) Select more elastic good from the following Answers Option 1 Electricity Option 2 Salt Option 3 Match box Option 4 Computer Question 48) From the below given goods, select one good on which law of demand is applicable Answers Option 1 Diamonds Option 2 Emergency medicines Option 3 Luxury car Option 4 Apple Question 49) Zero elastic demand curve is Answers Option 1 Parallel to x axis Option 2 Parallel to y axis Option 3 Negatively sloping Option 4 Rectangular Hyperbola Question 50) A unitary elastic demand curve represents Answers Option 1 Infinite elasticity Option 2 Zero elasticity Option 3 Constant elasticity Option 4 None of the above Enable JavaScript