Economics Past Questions and Answers

Which of the following statements best describes the relationship between average product and marginal products?

A Marginal product and average product curves rise and falls together
B Marginal product equals average product at the minimum point of the latter
C Average product curve will rise as product is greater than average product
D Marginal product at the maximum point of the fomer

Question 1352:

When a firm is reaping economies of large-scale production, it experiences a fall in its?

A Long-run marginal cost
B Long-run average cost
C Long-run total cost
D Short-run marginal cost

Question 1353:

If an increase in the price of a commodity leads to increase in total revenue, then it means that the demand for this commodity is?

A Normal
B Elastic
C Inelastic
D Abnormal

Question 1354:

Given that the elasticity of demand for a commodity is 2.5, the percentage change in the quantity demanded as a result of a 10 percent change in it price is?

A 0.25
B 0.40
C 4.00
D 25.00

Question 1355:

The producer in a perfectly competitive market is faced with a demand curve whose elasticity is?

A Unitary
B Greater than one
C Infinite
D Less than one