SAHAY INSTITUTE

Theory of Production and Cost - Test

Mayank Dua
CA Foundation Total Marks - 50

ANSWER KEY
1. (a) Creating/Addition of Utility

2. (d) Performing an art in a theatre

3. (a) Tilling of soil.

4. (a) The services of a doctor are considered production.

5. (b) Production

6. (b) Creation of utility in matter

7. (d) Both (a) and (b)

8. (a) Intention

9. (d) All of the above.

10. (a) Inputs

11. (d) Land, Labour, Capital and Entrepreneurial ability

12. (a) Land

13. (d) It is produced by our forefathers.

14. (b) It is a mobile factor of production

15. (a) It is an active factor

16. (d) Land is perishable

17. (b) Heterogeneous

18. (c) Its supply is fixed

19. (b) Perfectly Inelastic, Relatively Elastic

20. (b) Leisure

21. (d) Labour is not mobile

22. (d) All of the above.

23. (a) A labourer cannot store his labour.

24. (b) Active

25. (c) Human skills and abilities

26. (a) Circulating

27. (d) Both (a) & (b)

28. (a) Savings, Mobilization of Savings and investment

29. (a) Capital formation

30. (c) Capital is nature’s gift

31. (d) All of the above

32. (d) All of the above

33. (b) Schumpeter

34. (a) Innovate

35. (c) Schumpeter

36. (a) Organic

37. (b) Economic

38. (d) Entrepreneur

39. (d) All of the above.

40. (a) Schumpeter

41. (c) The relationship between the quantities of inputs needed to produce a given level of output.

42. (a) The quantity of physical inputs and physical output of a firm

43. (b) The highest resulting output.

44. (a) Technical relationship between physical inputs and physical output.

45. (a) Purely a technical relationship between input & output

46. (d) All the above.

47. (b) Production function

48. (c) Production function

49. (d) All the above.

50. (d) All of the above.