MCQ for CA Foundation ECONOMICS - PART 1 - BUSINESS ECONOMICS - Chapter 4 PRICE DETERMINATION IN DIFFERENT MARKETS
Sample Multiple Choice Questions (MCQ's) for CA Foundation - Paper 4 - Business Economics and Business and Commercial Knowledge - PART 1 - BUSINESS ECONOMICS - Chapter 4: PRICE DETERMINATION IN DIFFERENT MARKETS - For Practice relevant for Dec 22 and May/June 23 Examinations
Q:1 In the table below what will be equilibrium market price?
Price Demand (tonnes per annum) Supply (tonnes per annum)
(₹)
1 1000 400
2 900 500
3 800 600
4 700 700
5 600 800
6 500 900
7 400 1000
8 300 1100
- ₹ 2
- ₹ 3
- ₹ 4
- ₹ 5
Answer: 3
Q:2 Suppose the technology for producing personal computers improves and, at the same time, individuals discover new uses for personal computers so that there is greater utilisation of personal computers. Which of the following will happen to equilibrium price and equilibrium quantity?
- Price will increase; quantity cannot be determined.
- Price will decrease; quantity cannot be determined.
- Quantity will increase; price cannot be determined.
- Quantity will decrease; price cannot be determined
Answer: 3
Q:3 Price-taking firms, i.e., firms that operate in a perfectly competitive market, are said to be "small" relative to the market. Which of the following best describes this smallness?
- The individual firm must have fewer than 10 employees
- The individual firm faces a downward-sloping demand curve.
- The individual firm has assets of less than ₹ 20 lakhs.
- The individual firm is unable to affect market price through its output decisions.
Answer: 4
Q:4 When ___________ ,there will be allocative efficiency meaning thereby that the cost of the last unit is exactly equal to the price of consumers are willing to pay for it and so that the right goods are being sold to the right people at the right price.
- MC = MR
- MC = AC
- MC = AR
- AR = MR
Answer: 3
Q:5 The market for hand tools (such as hammers and screwdrivers) is dominated by Draper, Stanley, and Craftsman. This market is best described as
- Monopolistically competitive
- a monopoly
- an oligopoly
- perfectly competitive
Answer: 3
Q:6 In Economics, the term 'market' refers to a:
- place where buyer and seller bargain a product or service for a price
- place where buyer does not bargain
- place where seller does not bargain
- none of the above
Answer: 1
Q:7 The market for the ultimate consumers is known as
- whole sale market
- regulated market
- unregulated market
- retail market
Answer: 4
Q:8 Which of the following statements is incorrect?
- Under monopoly there is no difference between a firm and an industry.
- A monopolist may restrict the output and raise the price.
- Commodities offered for sale under a perfect competition will be heterogeneous.
- Product differentiation is peculiar to monopolistic competition.
Answer: 3
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