Business Economics - Questions and Answers for Competitive Exams | GkSeries

25. Passive factor of production is ________________.

• [A] Only land.
• [B] Only capital.
• [C] Both land and capital.
• [D] Neither land nor capital

Answer: Option [C]

26. _____________ Economies views on reducing the Production costs

• [A] Internal
• [B] Inventory
• [C] Pecuniary
• [D] External

Answer: Option [D]

27. Which factor of production is considered as fixed input?

• [A] Labour
• [B] Technology
• [C] Capital
• [D] Land

Answer: Option [D]

28. _____________ is the remuneration for organisation

• [A] Rent
• [B] Wages
• [C] Interest
• [D] Profit

Answer: Option [D]

29. When the output increases in the same proportion as the increase in input it is _____________ Returns

• [A] Constant
• [B] Average
• [C] Decreasing
• [D] Increasing

Answer: Option [A]

30. Marginal cost is defined as

• [A] Total cost divided by output
• [B] Change in total cost due change in output
• [C] Change in output due to a one unit change in an input
• [D] Total product divided by the quantity of inpu

Answer: Option [B]

31. Which of the following is correct

• [A] TC= TFC+ TVC
• [B] TFC= TC- TVC
• [C] TVC= TC- TFC
• [D] All of the above

Answer: Option [D]

32. Opportunity Cost is also Known as _____________

• [A] outlay cost
• [B] Sunk Cost
• [C] Alternative Cost
• [D] Total Cost

Answer: Option [C]

33. The vertical difference between TVC and TC is equal to _____________

• [A] MC
• [B] AVC
• [C] TFC
• [D] None

Answer: Option [C]

34. The formula for average variable cost (AVC) is __________________.

• [A] DQ/DTVC.
• [B] DTVC/DQ.
• [C] TVC/Q
• [D] Q/TVC

Answer: Option [C]

35. The rate at which a firm can substitute capital for labour and hold output constant is the ______________.

• [A] marginal rate of production
• [B] law of diminishing marginal returns
• [C] marginal rate of factor substitution
• [D] isoquant.

Answer: Option [C]

36. The formula for average fixed costs is __________________

• [A] TFC/Q
• [B] DQ/DFC.
• [C] Q/TFC.
• [D] TFC _ Q

Answer: Option [A]