In which market structure the market demand curve is represented by the demand curve of the firm?
(A) Monopoly
(B) Oligarchy
(C) Dual rights
(D) Perfect competition
Since all firms in perfect competition sell identical products and face the same market price, the market demand curve is determined by horizontally summing the individual firm's demand curves. Therefore, the market demand curve coincides with the demand curve of a single firm in perfect competition.
The demand for an inferior good falls when
(A) price increases
(B) income increases
(C) the price decreases
(D) the price decreases
In economics, the demand for inferior goods decreases as income increases or the economy improves. When this happens, consumers will be more willing to spend on more costly substitutes.
The demand for which of the following goods is elastic?
(A) electricity
(B) medicine
(C) rice
(D) match box
Among the given options, only the demand for electricity is elastic, whereas the demand for medicine, rice and matchbox is inelastic.
Name the function that represents the number of products a seller is willing to sell at a given price level.
(A) demand curve
(B) Price (cost) curve
(C) supply curve
(D) none of these
Supply curve is the curve which shows the quantity of products a seller wishes to sell at a given price level. Supply curve projects different level of goods which can be suppliied by the producers at different levels.
The cost of advertising is called
(A) implicit cost
(B) surplus cost
(C) fixed cost
(D) selling cost
The cost incurred in advertising is called selling cost.
Does not include the cost of sales
(A) Oligopoly
(B) monopoly
(C) perfect competition
(D) monopolistic competition
The supply of labour in the economy depends on
(A) Population
(B) National Income
(C) Per capita income
(D) Natural resources
The supply of labour also depends on the proportion of working population in the total labour force. This partly depends on the minimum age at which a person can join the labour force and engage in full time employment.
When the labour supply curve bends backwards
(A) Income becomes an inferior good
(B) Work becomes an inferior commodity
(C) Leisure becomes an inferior commodity
(D) People become lazy at higher salary level
Write the correct statement.
(A) The value of a commodity depends on its price.
(B) The value of a good depends entirely on the substitute goods.
(C) A thing will have value (importance) only when someone wants to have it.
(D) A commodity will have value only if it is scarcer than the demand.
In which of the following market structures, there is a variable demand curve?
(A) Perfect competition
(B) Monopoly
(C) Oligpoly
(D) Monopolistic competition
There is freedom of entry and exit. Sellers have perfect knowledge about the market conditions. They are price taker. Price Elasticity of Demand of a firm is Infinite which means demand curve for Perfect competition is a Perfectly Elastic.
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