This quiz works best with JavaScript enabled. Home > Economics > Managerial Economics > Managerial Economics – Quiz 5 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Managerial Economics Quiz 5 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Sam spent $ 5, 000 on a commodity and bought 25 units of it. When its price changed, he spent $ 6, 000 and bought 20 units. The elasticity of demand by total expenditure method will be: A) Ed<1. B) Ed=1. C) Ed>1. D) Ed=0. Show Answer Correct Answer: A) Ed<1. 2. 'What ought to be done' is related with which among the following? A) Normative. B) Positive. C) Both normative & positive. D) None of these. Show Answer Correct Answer: A) Normative. 3. Which of these deals with marginal utilities of two products being at equilibrium A) Law of equi-marginal utility. B) Law of diminishing marginal utility. C) Indifference curve. D) Consumer equilibrium. Show Answer Correct Answer: A) Law of equi-marginal utility. 4. Generally when calculating profits as total revenue minus total costs, accounting profits are larger than economic profits because economists take into account A) Only explicit costs. B) Only implicit costs. C) Both explicit and implicit costs. D) Both types of profits are always equal because they account for the same costs. Show Answer Correct Answer: C) Both explicit and implicit costs. 5. Scarcity definition by A) Robbins. B) Smith. C) Marshall. D) Fin. Show Answer Correct Answer: A) Robbins. 6. Economies and diseconomies of scale explain A) Why the average fixed cos curve is falling. B) Why the average variable cost cost curve is U-shaped. C) Why there are three stages of production. D) Why the long-run average cost curve is U-shaped. Show Answer Correct Answer: D) Why the long-run average cost curve is U-shaped. 7. Basic economic tools of managerial economics does not include A) Principle of time perspective. B) Equi-marginal principle. C) Incremental principle. D) None of these. Show Answer Correct Answer: D) None of these. 8. Economics helps to understand taxation and government policies. A) True. B) False. Show Answer Correct Answer: A) True. 9. Which of the following is an implicit cost? A) Wages paid to its employee. B) Rent paid for hired types of equipment. C) Depreciation charged on company-owned equipment. D) Taxes on company property. Show Answer Correct Answer: C) Depreciation charged on company-owned equipment. 10. Consumers become much more concerned about price changes when the good feels expensive, making the demand elastic. A) True. B) False. Show Answer Correct Answer: A) True. 11. Statement 1:Appropriate planning and measuring profit which is the most important and challenging area on managerial economics.Statement 2:Success of a firm depends on its primary measure and that is profit. A) Only statement 1 is correct. B) Only statement 2 is correct. C) Both statements are correct. D) Both statements are incorrect. Show Answer Correct Answer: C) Both statements are correct. 12. Economies of scale exist when the long-run average cost ..... as output expands. Labor specialization and technical factors often give rise to economies of scale. A) Increased. B) Decreased. C) Equal to Marginal Cost. D) None of the above. Show Answer Correct Answer: B) Decreased. 13. Which of the statements below best illustrates the use of the market process in determining the allocation of scarce resources? A) "Let's make this product because this is what we know how to do best.". B) "We should consider shifting to products where we can earn even more money.". C) "Everyone is opening video stores, why don't we?". D) "We can't stop making this product. This product gave our company its start.". Show Answer Correct Answer: B) "We should consider shifting to products where we can earn even more money.". 14. It is the willingness to take certain risks in the pursuit of goals. A) Entrepreneurship. B) Management. C) Microeconomics. D) Stages of Model of Change. Show Answer Correct Answer: A) Entrepreneurship. 15. Economics means..... A) Study of wealth of Nations. B) Study of commerce. C) Study of account. D) None of above. Show Answer Correct Answer: A) Study of wealth of Nations. 16. The producer sells the unsold stocks at a low price in the foreign market without reducing the domestic price is A) Anti dumping. B) Sporadic dumping. C) Predatory dumping. D) No dumping. Show Answer Correct Answer: B) Sporadic dumping. 17. Identify the phase in which TP increases at an increasing rate and MP also increases. A) Increasing returns to a factor. B) Decreasing returns to a factor. C) Negative returns to a factor. D) None of above. Show Answer Correct Answer: A) Increasing returns to a factor. 18. Publics A) Micro. B) Macro. Show Answer Correct Answer: A) Micro. 19. The field of economics that deals with the economic concepts and analysis of problems that are required to formulate rational managerial decisions A) Positive Economics. B) Normative Economics. C) Macro Economics. D) Managerial Economics. Show Answer Correct Answer: D) Managerial Economics. 20. ..... risk involves variation in returns due to the ups and downs of the economy, the industry and the firm. A) Business. B) Structural. C) Fluctuational. D) Financial. Show Answer Correct Answer: A) Business. ← PreviousNext →Related QuizzesEconomics QuizzesManagerial Economics Quiz 1Managerial Economics Quiz 2Managerial Economics Quiz 3Managerial Economics Quiz 4Managerial Economics Quiz 6Managerial Economics Quiz 7Managerial Economics Quiz 8Managerial Economics Quiz 9Managerial Economics Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books