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Managerial Economics
SECTION –A
Q1. Attempt any 15 (15X2=30)
1. When a firm’s average revenue is equal to its average cost, it gets ________.
a. Super profit
b. Normal profit
c. Sub normal profit
d. None of the above
2. Given the price, if the cost of production increases because of higher price of raw materials, the supply
a. Decreases
b. Increases
c. Remains same
d. All of the above
3. Which of the following is a characteristic of a perfectly competitive market?
a. Firms are price setters.
b. There are few sellers in the market
c. Firms can Exit and enter the market freely.
d. All of the above
4. Managerial Economics as a specialized branch of Economics.
a. Provide ready-made solutions to business problems
b. Provide logic and methodology to find solutions to business problems
c. provide alternative answers to specific business problems.
d. Provide theoretical background to analyze business problems
5. The first stage in the five-step decision process described in the text is to
a. define the problem.
b. select the best possible solution.
c. determine the objective.
d. identify possible solutions.
6. At the point of equilibrium of firm (under perfect competition):
a. MC curve must be rising
b. MC curve must be falling
c. MR curve must be rising
d. None of these
7. Given the price, if the cost of production increases because of higher price of raw materials, the supply
a. Decreases
b. Increases
c. Remains same
d. Any of the above
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