Q. An individual demand curve slopes downward to the right because of the: Working of the law of diminishing marginal utilitysubstitution effect of decrease in priceincome effect of fall in PriceAll of the above Answer: All of the above

Q. If the demand for a good is inelastic, an increase in its price will cause the total expenditure of the consumers of the good to: IncreaseB DecreaseRemain the sameBecome zero Answer: Increase

Q. Demand for a commodity refers to: Need for the commodityDesire for the commodityAmount of the commodity demanded at a particular price and at a particular timeQuantity demanded of that commodity Answer: Amount of the commodity demanded at a particular price and at a particular time

Q. Which of the following is a demand function? Q + 4P = 20Q = 35 + 3PQ - 2P - 15 = 05P - Q = 4 Answer: Q + 4P = 20

Q. If demand is unitary elastic, a 25% increases in price will result in: 25% change in total revenueNo change in quantity demanded1% decrease in quantity demanded25% decrease in quantity demanded Answer: 25% decrease in quantity demanded

Q. Other things equal, if a good has more substitutes, its price elasticity of demand is: LargerSmallerZeroUnity Answer: Larger

Q. When demand is perfectly inelastic, an increase in price will result in: A decrease in total revenueAn increase in total revenueNo change in total revenueA decrease in quantity demanded Answer: An increase in total revenue

Q. Under free exchange markets the rate of foreign exchange is determined by: Balance of Payments theoryMint par theoryPurchasing power parity theoryNone of the above Answer: Balance of Payments theory

Q. For measuring the changes in the price level of the country, which among the following index number is used Cost of living index numberProduction index numberSecurity Price index numberWhole sale price index number Answer: Whole sale price index number

Q. The new world Trade organization (WTO), which replaced the GATT came into effect from____ 1ST January 19911st January 19951st April 19941st May 1995 Answer: 1st January 1995

Q. Terms of trade that relate to the Real Ratio of international exchange between commodities is called: Real cost terms of tradeCommodity terms of tradeIncome terms of tradeUtility terms of trade Answer: Income terms of trade

Q. What is meant by Autarky in international trade? Monopoly in international tradeImposition of restrictions in international tradeRemoval of all restrictions from international tradeThe idea of self sufficiency and no international trade by a country Answer: The idea of self sufficiency ...