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
