TNPSC General Economics MCQ - 2

21. Transformation of inputs into outputs is known as
A. Production C. Distribution
B. Consumption D. Exchange

22. ----- is an example of secondary input
A. Land C. Capital
B. Labour D. Raw material

23. Odd-man out from the following
A. Steel C. Education
B. Medicine D. Train

24. The choice of techniques of production is related to the problem of
A. What to produce C. For whom to produce 
B. How to produce D. None of the above

25. The functional relationship between inputs and outputs is called
A. Production function C. Investment function
B. Consumption function D. Saving function

26. Firms owned by one individual is known as
A. Proprietorship C. Corporations
B. Partnership D. None of the above

27. Firms owned by two or more individuals is known as
A. Proprietorship C. Corporations
B. Partnership D. None of the above

28. Firms owned by stock holders are known as
A. Proprietorship C. Corporations
B. Partnership D. None of the above

29. The major objective of a firm is
A. Profit maximization C. Sales maximization
B. Revenue maximization D. None of the above

30. Which one of the following is an example of fixed input
A. Raw materials C. Plant and equipments
B. Casual workers D. All of the above

31. In short-run
A. All inputs are fixed
B. All inputs are variable
C. Some inputs are fixed and some are variable
D. None of the above

32. In long-run
A. All inputs are fixed
B. All inputs are variable
C. Some inputs are fixed and some are variable
D. None of the above

33. Marginal product of a factor is
A. The additional product received by the firm due to the  employment of an additional unit of a variable factor
B. Addition to the total product when one more unit of a factor is  employed 
C. The rate of change in the total product per unit change in the
 variable factor.
D. All of the above

34. Production function expresses
A. The relationship between input and output
B. How maximum output is produced with the given input
C. What is the least-cost combination of input to produce the given  output
D. All of the above

35. The variable cost of a firm vary in direct proportion to the
A. Volume of its output C. Volume of its sale
B. Extent of its profits D. All of the above

36. Law of variable proportions is concerned with
A. Long-run production function
B. Laws of returns to scale
C. Short-run production function
D. None of the above

37. The ‘point of inflection’ come in which stage of the law of variable proportions
A. Stage I C. Stage III
B. Stage II D. None of the above

38. A rational producer will select his level of production in which stage of  the law of variable proportions
A. Stage I C. Stage III
B. Stage II D. Either Stage I or Stage II

39. Total product reaches at maximum when
A. MP is increasing C. MP = 0
B. MP is maximum D. MP is negative

40. At the ‘point of inflection’
A. MP is maximum C. TP is maximum
B. AP is maximum D. All of the above 

ANSWER KEYS
21 A 22 D 23 C 24 B 25 A 26 A 27 B 28 C 29 A 30 C 
31 C 32 B 33 D 34 D 35 A 36 C 37 A 38 B 39 C 40 A

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