Top 150+ Solved Micro Economics analysis MCQ Questions Answer
Q. Which of the following condition are met in the long run equilibriumof the monopolistic competitor earning only normal profit
a. mc=ac
b. p=ac
c. p=mr
d. p=mc
Q. The term group equilibrium is referred to
a. duopoly
b. monopolistic competition
c. perfect competition
d. oligopoly
Q. Increase or decrease in the level of production by a monopolistically competitive firm have ------- impact on price and output decisionsof other firms
a. very significant
b. significant
c. small
d. negligible
Q. Monopolistic competitive firm fixes the price of its product
a. independent of the price of close substitutes
b. close to the prices of close substitutes
c. at a very high level
d. none of the above
Q. Under monopolistic competition, an increase in the number of firms producing close substitutes will make the demand curve ofeach firm
a. inelastic
b. elastic
c. downward sloping
d. perfectly inelastic
Q. The demand curve faced by the a monopolistically competitive firmis very elastic if the degree of product differentiation is
a. very low
b. very high
c. zero
d. moderate
Q. Which one of the following is not a feature of monopolisticcompetition
a. homogeneous products
b. differentiated products
c. selling cost
d. no uniform prices
Q. The book “The theory of Monopolistic Competition” is written by
a. alfred marshal
b. e h chamberlin
c. joan robinson
d. j m keynes
Q. The book “The Economics of Imperfect Competition” is written by
a. alfred marshal
b. e h chamberlin
c. joan robinson
d. j m keynes
Q. It is assumed that the cost curves of all the firms in themonopolistic competition are
a. different due to product differentiation
b. never considered in equilibrium
c. never formulated
d. same in spite of product differentiation
Q. Free entry into monopolistically competitive market ensures that allfirms will produce at the lowest point of LAC
a. always
b. sometimes
c. never
d. cannot say
Q. Under monopolistic competition, the long run equilibrium of thefirm is established at the
a. minimum point of lac
b. point where lac is still falling
c. point where lac is rising
d. minimum point of lmc
Q. In short run a firms in monopolistic competition
a. always earns profit
b. incurs loss
c. earns normal profit only
d. may earn normal profit, abnormal profit or incur losses
Q. In long run all the firms in the monopolistic competition
a. always earns profit
b. incurs loss
c. earns normal profit only
d. may earn normal profit, abnormal profit or incur losses
Q. The short run equilibrium level of output of the monopolisticcompetitor is given by
a. price = mc
b. price= ac
c. mc=mr
d. p=mr