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Home
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Business Economics
Business Economics MCQs
?
Managerial Economics is
Dealing only micro aspects
Only a normative science
Deals with practical aspects
All of the above
?
The techniques of optimization include
Marginal analysis
Calculus
Linear programming
All of the above
?
In economics, desire backed by purchasing power is known as
Utility
Demand
Consumption
Scarcity
?
Basic assumptions of law of demand include
Prices of other goods should change.
There should be substitute for the commodity.
The commodity should not confer any distinction.
The demand for the commodity should not be continuous
?
Higher the price of certain luxurious articles, higher will be the demand, this concept is called
Giffen effects
Veblen effects
Demonstration effects
Both b & c above
?
In the case of perfect elasticity, the demand curve is
Vertical
Horizontal
Flat
Steep
?
Outlay method of measurement of elasticity is also called as
Percentage method
Expenditure method
Point method
Geometric method
?
_____________ demand forecasting is related to the business conditions prevailing in the economy as a whole
Macro level
Industry level
Firm level
None of these
?
_____________ is the base of marketing planning
Demand Estimation
Demand analysis
Demand function
Demand forecasting
?
______________ is the change in total revenue irrespective of changes in price or due to the effect of managerial decision on revenue
Average revenue
Total revenue
Marginal revenue
Incremental revenue
?
Perfect competition is characterized by
large number of buyers and sellers
homogeneous product
free entry and exit of firms
all the above
?
Purposes of Short term Demand forecasting doesn’t includes;
Making a suitable production policy.
To reduce the cost of purchasing raw materials and to control inventory.
Deciding suitable price policy
Planning of a new unit or expansion of existing unit
?
In ______________ approach, the demand for new product is estimated on the basis demand of existing product
Growth curve approach
Evolutionary approach.
Opinion polling approach
Vicarious approach.
?
The proportionate change in the quantity demanded of a commodity in response to change in the price of another related commodity is called Cross el...
Price elasticity
Income elasticity
Related elasticity
?
______________ Method is also known as Sales-Force – Composite method or collective opinion method
Opinion survey
Expert opinion
Delphi method
Consumer interview method
?
Psychological pricing is also called as;
Penetration pricing
Skimming pricing
Odd pricing
None of these
?
Customary pricing is also known as
Consumer pricing
Conventional pricing
Cost plus pricing
Full cost pricing
?
______________ is the process of finding current values of demand for various values of prices and other determining variables.
Demand Estimation
Demand analysis
Demand function
Demand forecasting
?
In the case of ______________ a small change in price leads to very big change in quantity demanded
Perfectly elastic demand
Perfectly inelastic demand
Relative elastic demand
Unit elastic demand
?
In ______________ approach, on the basis of the growth of an established product, the demand for the new product is estimated
Growth curve approach
Evolutionary approach.
Opinion polling approach
vicarious approach
?
Which one of the following is not a reason for adopting penetration price strategy
Product has high price elasticity in the initial stage.
The product is accepted by large number of customers.
Economies of large scale production available to firm
When the buyers are not able to compare the value and utility
?
Car and petrol are
Complimentary goods
Substitute goods
Supplementary goods
Reserve goods
?
Criteria for good demand forecasting includes;
Plausibility
Simplicity
Economy
All the above.
?
Cost plus pricing is also called
margin pricing
full cost pricing
mark up pricing
all the above
?
Generally used strategy for pricing new products is/are
Skimming price strategy
Penetration price strategy
Both a & b
None of these
?
The architect of the theory of monopolistic competition
Rosenstein Roden
JR Hicks
Karl Marx
Chamberlin
?
The function of combining the other factors of production is done by
land
labour
Capital
Entrepreneurship
?
______________ means the total receipts from sales divided by the number of unit sold.
Average revenue
Total revenue
Marginal revenue
Incremental revenue
?
Ep=0in the case of ______________ elasticity
Perfectly elastic demand
Perfectly inelastic demand
Relative elastic demand
Unitary elastic demand
?
Law of demand shows the functional relationship between ______________ and quantity demanded
Supply
Cost
Price
Requirements
?
When the change in demand is exactly equal to the change in price, it is called
Perfectly elastic demand
Perfectly inelastic demand
Relative elastic demand
Unitary elastic demand
?
Tea and coffee are
Complimentary goods
Substitute goods
Supplementary goods
Reserve goods
?
Survey method of demand forecasting includes
Opinion survey
Expert opinion
Delphi method
All the above
?
In ______________ pricing fixed cost are excluded.
skimming pricing
going rate pricing
administered pricing
marginal cost pricing
?
The market with a single producer
perfect competition
monopolistic competition
oligopoly
monopoly
?
The short run production function is called;
Returns to scale
law of variable proportion
Production possibility frontier
None of these
?
Which are the characteristics of monopoly?
Single seller or producer
No close substitutes
Inelastic demand curve
All of these
?
Whenever ______________ is greater than average total cost, average total cost is rising.
Marginal cost
Variable cost
Fixed cost
Full cost
?
Which of the following is not a macroeconomic concept?
Business cycle
National income
Government policy
None of these
?
Iso-cost line indicate the price of
Output
Inputs
Finished goods
Raw material
?
Who classified economies of scale into internal and external?
Robinson
Marshall
Edward west
Pigue
?
Product differentiation is the important feature of
monopoly
perfect competition
monopolistic competition
monophony
?
13th Finance Commission has been constituted under the chairmanship of:
C.Rangarajan
Vijay L Kelkar
Deepak Parekh
Indira Bhargara
?
Method of demand forecasting is also called "economic model building"
Opinion survey
Complete enumeration
Correlation and regression
Delphi method
?
The responsiveness of demand due to a change in promotional expenses is called
Expenditure elasticity
Advertisement elasticity
Promotional elasticity
Above b or c
?
Want satisfying power of commodity is called
Demand
Utility
Satisfaction
Consumption
?
The relationship between price and quantity demanded is
Direct
Inverse
Linear
Nonâ€linear
?
Decision making and ______________ are the two important functions of executive of business firms
Forward planning
Directing
Supervising
Administration
?
______________ shows the change in quantity demanded as a result of a change in consumers’ income
Price elasticity
Cross elasticity
Income elasticity
None of these
?
The firm charges price in tune with the industry’s price is called
competitive pricing
going rate pricing
tune pricing
target pricing
?
Which one of the following is not a reason for adopting skimming price strategy
When the demand of new product is relatively inelastic.
When there is no close substitutes
Elasticity of demand is not known
Product has high price elasticity in the initial stage
?
Information for pricing decisions involves:
Product information
Market information
Information at the micro level
All of these
?
The marginal revenue equation can be derived from the:
Demand equation
Supply equation
Cost equation
Price equation
?
Functional relationship between input and output known as
Conversion
Production function
Work in progress
Output function
?
in economics ______________ means ’a state of rest ’or ’stability’
Depression
Equilibrium
Maturity
growth
?
Selling cost is the feature of the market form
monopoly
monopolistic competition
oligopoly
none of these
?
Which is the reason of skimming price?
Inelastic demand
Diversion of market
Safer price policy
All of these
?
Which is the condition of for market penetration?
High price elasticity of demand in the short run
Savings in production costs
Threat of potential competition
All of these
?
If the commodities are substitute in nature, cross elasticity will be
Negative
Positive
Zero
Any of the above
?
Which one of the following is not an internal factor influencing pricing policy
cost
objectives
marketing mix
demand
?
For the commodities like salt, sugar etc., the income elasticity will be
Zero
Negative
Positive
Unitary
?
In the above function, the letter Y stands for
Yield of production
Income of consumers
Utility
Supply
?
When a small change in price leads to infinite change in quantity demanded, it is called
Perfectly elastic demand
Perfectly inelastic demand
Relative elastic demand
Relative inelastic demand
?
Price Elasticity of demand=
Proportionate change in quantity demanded Proportionate change in price
Change in Quantity demanded / Quantity demanded Change in Price/price
(Q2â€Q1)/Q1 (P2â€P1) /P1
All the above
?
An increase in income may lead to an increase in the quantity demanded, it is
Positive income elasticity
Zero income elasticity
Negative income elasticity
Unitary income elasticity
?
Fixing high price during the introduction is called
skimming
penetrating
full cost pricing
target pricing
?
In a perfectly competitive market, individual firm
cannot influence the price of its product
can influence the price of its product
can fix the price of its product
can influence the market force
?
Which is the determinant of the pricing policy of a firm?
Channel of distribution
Age of product
Consumer association
All of these
?
The causes of emergence of monopoly is/are:
Concentration of ownership of raw materials
State regulation
Public utility services
All of these
?
______________ is situation of severely falling prices and lowest level of economic activities
Boom
Recovery
Recession
Depression
?
Unitary elasticity of demand mean
EP =>1
EP =<1
EP =o
EP =1
?
Quantity remains the same whatever the change in price, this is the case of
Perfectly elastic demand
Perfectly inelastic demand
Relative elastic demand
Relative inelastic demand
?
Which of the following is not a function of managerial economists
Advice on trade and public relations
Economic analysis of agriculture
Investment analysis
Supervision and control
?
Analysis of long run and short run affects of decisions on revenue as well as costs is based on
Principle of time perspective
Equiâ€marginal principle
incremental principle
None of these
?
Which is the characteristics of managerial economics
Deals with both micro and macro aspects
Both positive and normative science
Deals with theoretical aspects
Deals with practical aspects.
?
In the case of ______________ Consumer may moves to higher or lower demand curve
Extension of demand
Contraction of demand
Shift in demand
Slopes in demand
?
______________ means an attempt to determine the factors affecting the demand of a commodity or service and to measure such factors and their influenc...
Demand planning
Demand forecasting
Demand analysis
Demand estimation
?
In the case of unitary elastic demand, the shape of demand curve is
Vertical line
Horizontal line
Rectangular hyperbola
Steep
?
Demand for necessary goods (salt, rice, etc,) is ______________ and demand for comfort and luxury good is
Elastic, inelastic
Inelastic, elastic
Elastic, elastic
Inelastic, inelastic
?
______________ Method is also known as Salesâ€Force –Composite method or collective opinion method
Opinion survey
Expert opinion
Delphi method
Consumer interview method
?
Which one of the following is an internal factor influencing pricing
demand
competition
distribution channel
product life cycle
?
______________ forecasting is more important from managerial view point as it helps the management in decision making with regard to the firms demand ...
Macro level
Industry level
Firm level
None of these
?
Total Revenue will be maximum at the point where Marginal Revenue is
One
Zero
<1
>1
?
Under ______________ Method, a panel is selected to give suggestions to solve the problems in hand
Opinion survey
Expert opinion
Delphi method
Consumer interview
?
Method of charging low price initially called ______________
skimming
penetrating
full cost pricing
target pricing
?
Which of the following is/ are the reason for adopting skimming price strategy
When the buyers are not able to compare the value and utility.
To attract the high income customers.
When the product has distinctive qualities, luxuries
All the above
?
Under oligopoly a single seller cannot influence significantly
market price
quantity supplied
advertisement cost
all the above
?
Average cost pricing is also called as
cost plus pricing
marginal cost pricing
margin pricing
both a & c
?
Which of the following is / are the reason for adopting penetration price strategy
Economies of large scale production available to firm.
Potential market for the product is large.
Cost of production is low.
All the above
?
Purposes of Short term Demand forecasting includes;
Making a suitable production policy.
To reduce the cost of purchasing raw materials and to control inventory.
Deciding suitable price policy
All the above
?
Demand for tyres depends on demand of vehicles, the demand for tyres called as
Composite demand
Derivative demand
Joint demand
Direct demand
?
when income increases, quantity demanded falls, it is
Positive income elasticity
Zero income elasticity
Negative income elasticity
Unitary income elasticity
?
Consumer Interview method of demand forecasting may undertaken by;
Complete enumeration
Sample survey
Endâ€use method
All the above
?
Under which method, the cost is added with the predetermined target rate of return on capital invested
Cost plus pricing
Target pricing
Mark up pricing
None of these
?
Prices of Bata shoe as Rs.99.99, this pricing is
Mark up pricing
Odd pricing
Marginal cost pricing
Follow up pricing.
?
Average revenue is the revenue per
unit commodity sold
total commodity sold
marginal commodity sold
none of these
?
In a perfect market both buyers and sellers are
price maker
price giver
price taker
all the above
?
So long as Average Revenue is falling, Marginal Revenue will be ______________ Average Revenue
Less than
More than
Equal to
None of these
?
Price discrimination is also called as
Discriminatory pricing
Differential pricing
Average cost pricing
a & b above
?
_____________= R2-R1/Q2-Q1
Average revenue
Total revenue
Marginal revenue
Incremental revenue