In perfect competition, when a firm is in short periods, for equilibrium, the following condition does apply<br>1. Marginal cost must equal marginal revenue.<br>2. Average cost must equal average revenue.<br>3. Marginal revenue must equal average revenue.<br>4. Marginal cost must equal average cost.

The marginal cost is equal is to marginal revenue, the average cost is equal to average revenue, average revenue is equal to marginal revenue, and the average cost is equal to marginal cost. This is the condition of
1. Long-period equilibrium for a firm under monopoly.
2. Short-period equilibrium for a firm under oligopoly.
3. Long-period equilibrium
4. Long-period equilibrium for a firm under perfect competition.

A

1 and 4

B

3 and 4

C

1 and 3

D

Only 1

Marginal cost is equal to marginal revenue, average cost is equal to average revenue, average revenue is equal to marginal revenue and average cost is equal to marginal cost. This is the condition of
1. long period equilibrium for a firm under monopoly
2. short period equilibrium for a firm under oligopoly
3. long period equilibrium
4. long period equilibrium for a firm under perfect competitions
Select the correct answer

A

Both 1 and 4

B

Both 3 and 4

C

Both 3 and 1

D

Only 1

If an imperfectly competitive firm is producing a level of output where marginal cost is equal to marginal revenue, marginal revenue is below average variable cost, and the price is equal to the average total cost, then the firm is

A

In long-run equilibrium

B

In short-run equilibrium

C

Minimizing short-run average total cost

D

Breaking even

A particular price level, there are no forces tending to move it either up or down, it means
1. the firm is in equilibrium.
2. the price is in equilibrium.
3. the equilibrium price of the firm.
4. the equilibrium price and quantity of a firm.
Select the correct answer

A

Both 1 and 4

B

1, 2 and 4

C

Both 1 and 3

D

Only 4

Two outlets of a motor manufacturing company reported that revenue from outlet x in 2013 was down 11 percent from 2012. and revenue from outlet Y in 2013 were up 7 percent from 2012. If total revenue from outlet X & Y in 2013 was up 1 percent from 2012, what is the ratio of revenue from outlet X in 2012 revenue from outlet Y in 2012?

A

1 : 2

B

4: 5

C

1 : 1

D

3: 2

Due to the recession, a show room reported that revenue from luxury car sales were down by 11% and revenue from economy car sales were up by 7% . If the total revenue were up by 1% then what is the ratio of revenue from luxury car sales to revenue from economy car sales ?

A

3 :2

B

11:7

C

4:5

D

1:2

Assertion (A) All firms under perfect competition in long run earn only normal profit.
Reason (R) All firms under perfect competition in long run operate at the minimum average cost level.

A

Both (A) and (R) are true

B

(A) is true, but (R) is not true

C

(A) is not true, but (R) is true

D

Both (A) and (R) are false

In the short run, a monopolist will shut down if it is producing a level of output where marginal revenue is equal to the short-run marginal cost and price is

A

Greater than average total cost

B

Less than average total cost

C

Greater than average variable cost

D

Less than average variable cost

Short run marginal cost curve cuts the short run average cost curve from _______ at the minimum point of short run average cost.

A

top

B

below

C

right

D

left

A', 'B' and 'C' are partners in a partnership firm named A, B & C. 'A' retires from the firm without giving any public notice. Thereafter, an existing creditor lends Rs. ten lakh to the firm on the basis of his knowledge that 'A', 'B' and 'C' are the three partners in the firm. This amount remains unpaid by the firm. The creditor wants to recover the unpaid loan amount from the firm.

A

No one will be liable for the unpaid loan amount

B

A', 'B' and 'C' will be liable for the unpaid loan amount

C

Only 'B' and 'C' will be liable for the unpaid loan amount

D

Only 'A' will be liable for the unpaid loan amount