( Best 200+ ) Basics of Economics MCQ

by Mr. DJ

Basics of Economics MCQ

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Basics of Economics MCQ

Basics of Economics MCQ

31. A rational producer will select his level of production in which stage of
the law of variable proportions

A. stage i

B. stage ii

C. stage iii

D. either stage i or stage ii

32. Total product reaches at maximum when

A. mp is increasing

B. mp is maximum

C. mp = 0

D. mp is negative

33. Returns to scale refers to the production function where

A. all factors are fixed

B. some factors are fixed and others are variable

C. all factors are variable

D. none of the above

34. In the case of diminishing returns to scale, a given proportionate
increase in all factors causes

A. a more than proportionate increase in output

B. an equal proportionate increase in output

C. a less than proportionate increase in output

D. none of the above

35. Increasing returns to scale occurs due to

A. division of labour

B. specialization

C. economies of scale

D. all of the above

36. The cause for diminishing returns to scale is:

A. improper proportion of factors of production

B. difficulty in the combination of certain factors

C. excess combination of certain factors

D. all of the above

37. The solution to diminishing returns to scale is :

A. technical progress

B. expansion of resources

C. proper combination or resources

D. all of the above

38. Which one of the following is not related to economies of scale:

A. scope for division of labour and specialization

B. scope for getting inputs at cheaper rates

C. difficulty faces by the managers to coordinate the business

D. scope for better storage facilities

39. The law of Diminishing returns is applicable to:

A. agriculture only

B. industry only

C. in short-run only

D. universally

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