In Economics, long run is a period in which:

• A) Firms cannot enter and exit
• B) All inputs can be changed
• C) No input can be changed
• D) At least one input is fixed

In case of Monopoly:

• A) Marginal revenue is always equal to average revenue.
• B) Marginal revenue is always less than average revenue.
• C) Total revenue curve always slopes upward.
• D) Marginal revenue curve always slopes upward.

In case of perfect competition, the shape of long-run supply curve of an increasing cost industry is always:

• A) Vertical
• B) Horizontal
• C) Negatively sloped
• D) Positively sloped

When a competitive firm achieves long run equilibrium then:

• A) P=ATC
• B) All of the given options
• C) P=MC
• D) MR=MC

Suppose a firm produces 15 units of output and incurs Rs.30 in average variable cost and Rs.8 in average fixed cost, average total cost is:

• A) Rs.38
• B) Rs.30
• C) Rs.33
• D) Rs.17

In monopoly, at various output levels, average revenue is:

• A) Less than marginal revenue
• B) Equal to marginal revenue
• C) Average revenue and marginal revenue curves are not parallel
• D) Greater than marginal revenue

In price discrimination, price elasticity of demand in different segments of market should be:

• A) Infinite elastic.
• B) Unit elastic.
• C) Different.
• D) Same.

Which of the following is the market structure in which firms are mutually dependent?

• A) Perfect competition
• B) Monopolistic competition
• C) Oligopoly
• D) Monopoly

A cartel is an organization of oligopolistic firms which is formed through a formal written agreement to cooperate in setting:

• A) Quantity to produce
• B) Price only
• C) Price and output
• D) Relative elasticities

All of the following are key characteristics of oligopoly EXCEPT:

• A) Large number of firms
• B) Pricing Interdependence
• C) Non-price competition
• D) Difficult entry

All of the following are necessary conditions for the success of cartels EXCEPT:

• A) Adherence to agreement
• B) Possibility of Exerting Counter Pressure on the Part of Buyers
• C) All important producers must join
• D) Low price elasticity of demand

Which of the following oligopoly models predicts that oligopoly prices will tend to be very inflexible?

• A) Cost-plus pricing model
• B) Kinked demand model
• C) Collusive oligopoly model
• D) Price leadership model

The imposition of a tariff becomes a gain for one nation at the expense of:

• A) All of the given options
• B) Its domestic industries
• C) Its trade partners
• D) The global economy

The productivity of labor increases as each unit of labor (L) is combined with more capital (K) in the production of commodities.

• A) True
• B) False
• C)
• D)

Import quotas are used for which of the following purposes?

• A) All of the given options
• B) Protecting domestic industry
• C) Balance-of-payments reasons
• D) Protecting domestic agriculture

What will happen to producer surplus when a nation imposes a 100 percent tariff on imports of commodity X?

• A) It will increase.
• B) It will not change.
• C) It will decrease.
• D) It will become minimum.

Producer surplus is calculated as the area:

• A) Above the supply curve
• B) Above the demand curve
• C) Above the supply curve and below the market price
• D) Under the demand curve and above the market price

A compound tariff is a combination of an ad valorem tariff and a specific tariff.

• A) False
• B) True
• C)
• D)

When a nation imposes a tariff, its offer curve shifts or rotates toward the axis measuring its importable commodity by the amount of the import tariff.

• A) False
• B) True
• C)
• D)

A specific tariff of $10 on imported bicycles means that customs officials collect the fixed sum of-------- on each imported bicycle regardless of its price.

• A) $10
• B) $5
• C) $20
• D) $15