Pakistan Cement Company operates in an oligopolistic market structure. It faces the kinked demand curve which explains:

• A) Price rigidity.
• B) Price flexibility.
• C) Firm’s independence.
• D) Output flexibility.

Combined effects of Russian revolution, hyperinflation and crash of New York stock exchange results in:

• A) Low inflation
• B) High unemployment
• C) High consumption
• D) Low unemployment

KFC charges different prices for the same products in different countries. This is an example of:

• A) 2nd degree price discrimination.
• B) 1st degree price discrimination.
• C) 3rd degree price discrimination.
• D) Limit pricing.

Which of the following is an example of a real-world industry that exhibits monopolistic competition?

• A) Fast food restaurants
• B) Electricity generation
• C) Wheat farming
• D) Pharmaceutical drugs

According to Classical economists, an increase in aggregate demand would:

• A) Increase the price level and decrease the level of output.
• B) Only increase the price level.
• C) Increase both the price level and the level of output.
• D) Only increase the level of output.

In monopolist market, a new entrant firm should produce where:

• A) Marginal Cost < Marginal Revenue.
• B) Marginal Cost > Marginal Revenue.
• C) Marginal Cost = Average Revenue.
• D) Marginal Cost = Marginal Revenue.

In the first-degree price discrimination, prices are determined by:

• A) The cost of production.
• B) The willingness to pay of each individual customer.
• C) Market competition.
• D) Government regulations.

For a monopolist, changes in demand will lead to changes in:

• A) All of the given options.
• B) Price with no change in output.
• C) Output with no change in price.
• D) Both price and quantity.

If a grocery store offers 1 pack of Express surf powder for Rs.1500 and two packs of Express surf powder for Rs.2800, it reflects that the grocery store is engaging in:

• A) Limit pricing
• B) First degree price discrimination
• C) Third degree price discrimination
• D) Second degree price discrimination

What is a characteristic of monopolists' profits in comparison to perfectly competitive firms?

• A) Monopolists earn subnormal profits
• B) Both earn equal profit
• C) Monopolists earn normal profits
• D) Monopolists earn supernormal profits

Differentiated products in monopolistic competition mean that:

• A) Products are highly standardized
• B) All firms offer the same product with no variation
• C) Products are exactly the same across all firms
• D) Each firm's product has unique characteristics

According to Keynesian economics, what was the primary driver of economic downturns such as the Great Depression?

• A) Overproduction and excess supply in the market.
• B) Government intervention and regulation.
• C) Lack of consumer spending and effective demand.
• D) A surplus of available jobs in the labor market.

Adam Smith's Invisible Hand Theory states that:

• A) People are involuntarily unemployed in the economy.
• B) Market mechanism produces efficient outcomes for economy.
• C) Long run market equilibrium always occur below the full employment level.
• D) Government intervention is required for efficient regulation of economy.

Which of the following statements best describes the relationship between the Marginal Disutility of Work(MDUW) and leisure?

• A) As MDUW increases, the desire for leisure decreases.
• B) As MDUW increases, the demand for leisure increases.
• C) MDUW and leisure are unrelated concepts.
• D) MDUW has no impact on the desire for leisure.

Suppose a firm hires five workers and offers them to pay Rs. 350 for 6 hours. Later on, firm decides to increase working hours instead of hiring new workers. As working hours increase, the wage rate:

• A) Decreases.
• B) First decreases then increases.
• C) Remains unchanged.
• D) Increases.

To hire the next worker, the firm pays Rs.50. This Rs.50 is the:

• A) Marginal product
• B) Marginal input cost.
• C) Marginal revenue product.
• D) Marginal revenue.

Public goods are characterized by which two key attributes?

• A) Non-rivalry and excludability
• B) Rivalry and excludability
• C) Rivalry and non-excludability
• D) Non-rivalry and non-excludability

Which of the following would cause the short run aggregate supply curve to shift to the left, but have no effect over the long run aggregate supply?

• A) The amount of factors of production increase
• B) Prices of inputs increase
• C) The amount of factors of production decrease
• D) Prices of inputs decrease

For a firm buying labor competitively, the marginal input cost is equal to the:

• A) Wage.
• B) Price of output.
• C) Interest rate.
• D) Cost of raw materials.

The equilibrium point in the labor market occurs when:

• A) The supply and demand curves for labor intersect.
• B) Employers have complete control over wages.
• C) Labor unions dictate the terms of employment.
• D) The wage rate is set by government regulations.