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1………..is characteristic
of perfect competition.

A. Single seller

B. Selling cost

C. Kinked demand curve

D. Perfect information

ANS:  D

2. Under perfect competition firm is————

A. Price maker

B. Price taker

C. Product differentiated

D. Price rigidity

ANS:  B

3. A monopoly producer usually earns ——–

A. Super normal profit

B. Neither profit nor loss

C. Only normal profit

D. Profit and loss which are uncertain

ANS:  A

4. Under perfect competition firm demand curve
is ——–

A. Vertical

B. Horizontal

C. Upward

D. Downward

ANS:  B

5. The following industry often is a
monopoly———–

A. Cigarette industry

B. Publishing industry

C. Drug industry

D. Electric power industry

ANS:  D

6. Under monopoly the slope of AR curve is
————

A. Upward sloping

B. Downward sloping

C. Horizontal sloping

D. Verticalsloping

ANS:  B

7. Copyright related to———————-
monopoly

A. Natural monopoly

B. Legal monopoly

C. Technology monopoly

D. Control over resources monopoly

ANS:  B

8. Firms in monopolistic competition make
products that are……..

A. Close but not perfect
substitute

B. Perfect substitute

C. Close but not perfect complements

D. Perfect complements

ANS:  A

9. Price rigidity is a characteristic of
———

A. Monopoly

B. Perfect competition

C. Monopolistic competition

D. Oligopoly

ANS:  D

10. In oligopolistic markets
…………….

A. There are many firms

B. There are a only few firms

C. There are no barriers to entry

D. All firms are price takers

ANS:  B

11. Game theory proves
most useful for analyzing —

A. Monopoly

B. Perfect competition

C. Monopolistic competition

D. Oligopoly

ANS:  D

12. Kinked demand curve
is associated with ————-

A. Cournot

B. Chamberlin

C. Edgeworth

D. Sweezy

ANS:  D

13. A monopolistic firm
will expand its output when ————

A. MR >MC

B. MC > MR

C. MC = MR

D. MR is negative

ANS:  A

14. Upper portion of the
kinked demand curve is relatively ————-

A. More inelastic

B. More elastic

C. Less elastic

D. Less inelastic

ANS:  B

15. Selling costs have
to be incurred in case of————-

A. Oligopoly

B. Monopolistic competition

C. Monopoly

D. Duopoly

ANS:  B

16. Supernormal profit means…….

A. TR = TC

B.TR>TC

C.TR<TC

D. TC > AC

 ANS: B

 17. The refrigerator industry is an
example of ————–

A. Perfect competition

B. Monopoly

C. Oligopoly

D. Monopolistic competition

 ANS: C

 18. The monopolistic firm sale 100 unit of output at a price Rs. 10 per unit, total

 cost of
production 100 units is Rs.1200 . What is loss of firm?

A. 300

B. 200

C. 100

D. 400

 ANS: B

 19. Which of the following
characteristics is always present in an oligopolistic industry?

A. Non price competition

B. Collusion

C. Price stability

D. Interdependence between firms

 ANS: D

 20.
Under oligopoly market if one firm reduces the price of product then other firm
also —–

A. Increase price

B. Reduce price

C. Stay original price

D. Regular

 ANS: B

21. Cost plus pricing is also called——–

A. Transfer pricing

B. Marginal cost pricing

C. Full cost pricing

D. Average cost pricing

ANS:  C

22. Marginal cost pricing generally followed
by………

A. Private enterprises

B. Small and medium enterprises

C. Public sector enterprises

D. Large Private MNCs

ANS:  C

23 .Which pricing strategy uses various class
distinctions?

A. Marginal cost pricing

B. Price discrimination

C. Product line pricing

D. Mark-up pricing

ANS:  C

24. Marginal cost pricing may be charged for
which of the following reasons?

A. Maximizing profit

B. To control monopoly

C. Minimizing losses

D. Prevent shut down of the firm

ANS:  B

25. While determining the full cost price, the
firm uses ———

A. Fully allocated
average cost

B. only AVC

C. Only overhead cost

D. Marginal cost

ANS:  A

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