KOFFI SOPIE ROSEMONDE MBA1

Total Marks: 100 marks

Subject: Managerial Economics
MBA :Test 1
Multiple Choice Questions: (5 marks each)

1. Demand means
a. Desire to buy
b. Ability to buy
c. Willingness to buy
d. All of above
2. A market segment consists of a large identifiable group within a market with similar wants,
purchasing power, geographical location, or buying behaviour.
a. Mass Marketing
b. Segment marketing
c. Niche marketing
d. None of above
3. A very small change in price leads to infinite change in demand Is ……...
a. Elastic Demand
b. Perfectly elastic demand
c. Inelastic
d. Perfectly inelastic
4. The change in the price of commodity Y and its effects on the demand for commodity X are
considered as…………………..
a. Cross elasticity of demand
b. Income elasticity of demand
c. Price elasticity of demand
d. None of above
5. Price is determined in a free market by the interaction of…………………….
a. Price and supply
b. Price and demand
c. Demand & Supply
d. None of above
6. The ratio percentage or a proportional change in the quantity demanded to the percentage or
proportional change in the income
a. Income Elasticity
b. Advertising Elasticity
c. Cross Elasticity
d. Price elasticity
7. The price elasticity of demand measures
a. The slope of a budget curve.
b. How often the price of a good changes.
c. The responsiveness of the quantity demanded to changes in price.
d. How sensitive the quantity demanded is to changes in demand
8. If price elasticity is between 0 and 1, demand is -
a. Inelastic
b. Elastic
c. Unitary elastic
d. Perfectly elastic
9. The elasticity of demand can range between
a. Negative one and one.
b. Zero and infinity.
c. Zero and one.
d. Negative infinity
10. Which is the primary factor of production
a. Land
b. Labour
c. Capital
d. All of above
11. Thecostofanyactivitymeasuredintermsofthevalueofthenext best alternative forgone is ………………
a. Fixed Cost
b. Variable cost
c. Opportunity cost
d. None of above
12. Incremental cost is also know as ………………..
a. Explicit cost
b. Implicit cost
c. Marginal cost
d. All of above
13. Long Run is a period of time in which all factors of production and costs are ……………
a. Fixed
b. Fixed & Variable
c. Variable
d. All of above
14. Function specifying output of a firm, an industry, or an entire economy for all combinations of
inputs.
a. Income function
b. Cost function
c. Production function
d. Sales function
15. indicates all possible combinations of two inputs which can be purchased with a given
amount of investment fund
a. Income Elasticity
b. Isoquant
c. Iso cost line
d. Price elasticity

16. cost is the overall actual expense involved in creating a good or service for sale to
consumers
 a. Fixed cost
b. Labour cost
c. Real cost
d. Material cost

17. Which line is also known as scale line ?

a. Expansion path
b. Isoquant line
c. Isocost line
d. Price line
18. A small firm only competes with other firms, but larger firms frequently find their own products are
competing with each other
a. Interia
b. Cannibalization
c. Ringelmann effect
d. None of above
19. When there are many products the loss in one can be balanced by the profit in the other is known as
a. Diversification
b. Vertical Integration
c. Market economics
d. Production function
20. Fixed Cost Include
a. Depreciation
b. Payment of rent for building
c. Insurance Premium
d. All of above