S.

N QUESTIONS
O ANSWERS

1 shows the overall output generated at a

given level of input production function
2 If LAC curve falls as output expands, this is due to economics of scale

3 Isoquants are equal to

production lines
The marginal product curve is above the average product
4
curve when the average product is increasing
external and internal
5 Increasing returns to scale can be explained in terms of
economics

6 An isoqaunt is to an isocost line at the

equlibrium point tangent
7 At the point of inflextion, the marginal product is maximum

8 Diminishing marginal returns implies

increasing marginal costs
If the marginal product of labour is below the average average product of labour is
9
product of labour, it must be true that: falling
only one input is fixed and all
10 Law of variable proportion is valid when:
other inputs are kept variable
Change in total revenue due to incremental change in
11
quantity supplied is called marginal revenue
Increase in all input leading to less than proportional
12
increase in output is called decreasing return to scale

consider the following combinations of inputs and

outputs:
this production technology satisfies
13

constant returns to scale

14 During II nd stage of law of diminishing returns:

MP and AP are decreasing
 180
consider the following table:
what is the total output, when 2 labours are employed
15

who was given the concept of Innovative

16
Entrepreneurship?

Schumpeter
AT 10 units Total cost:Rs200
17 20 units Total cost : Rs 600
marginal cost= ? Rs40
Average fixed cost= Rs 20
18 quantity produced= Rs 10
What will be the average fixed cost of 20th unit? Rs10

19 What is Production in economics:

creation/addition of utility
20 External Economics of scale are obtained by a group of firm
AFC will be positive & AVC will
21 if a firms output is zero, them
be zero (Both)
risk of bearing
intiating a business enterprise
22 Functions of their entrepreneur are and resourse co-ordinating
introducting new innovations
ALL OF ABOVE

23 Law of diminshing returns is appliacable in any economic activity at

apoint of time
24 labour force wants more
leisure
25 Production activity in the short-run is analaysed by
law of variable proportion
ALL OF THESE
26 Increasing returns to scale occurs due to economics of scale
specialisation
indivisibilty of factors
in all economic activities after
27 Law of diminshing returns is appliacable in
a limit
BOTH (a) & (b)
28 Law of increasing returns is applicable because of indivisibility of factors
specialization
 when output decreases by 20% due to an increase in
29
inputs by 20%, this stage is called the law of
none of the above

In the first stage of the law of variable proprtionsm the

30
total product increases at the
increasing rate

31 what be the the total total product when two labourers

are hired according to the table given below?

580
which function shows the relationship between input
32
and output? production function
BOTH (a) & (b)
33 External Economics of scale are enjoyed: By large producers only
as the firm expands

34 The law of diminishing returns is applicable in all economic activities after a

point

35 The concept of returns to scale is related to

long period
intiating an enterprise and
resiurse coordination
36 The function of an entreprenuer is risk bearing
introducting innovations
All of above

37 which of the following is not a characteristics of land it is a mobile factor of

production
A production function is defined as the relationship the quantity of physical inputs
38
between and physical output of a firm
Production activity in the short period is analysed with
39
the help of law of variable proportion
fuller utilisation of fixed
factors
Which of the is the reason for the working of the law of indivisbility of the factors
40
increasing returns greater specialization of
labour
All of the above

41 External economies can be achieved through

constant returns to scale
42 External economies arise due to
growth of ancillary industries
43 Innovation theory of entrepreneurship is propounded by
Schumpeter
 purely a technical relationship
44 Production function is
between input & output
45 The concept of returns to scale is related with long period

46 In Cobb-Douglas production function, two inputs are

Labour and capital

47 which one of the following is not a characteristic of land

An active factor of production
intiating an enterprise and
resiurse coordination
An entreprenuer undertakes which one of thef ollowing
48 risk bearing
functions
introducting innovations
All of above
With aview to increase his production, Hariharan a
manufacturer of shoes, increases all the factors of
production in his unit by 100%.But at the end of the year,
49
he finds that instead of an increase of 100%, his
production has increased by only 80%. which law of
returns to scale is operating in thia case? decreasing return to scale

50 Linear homogenous production function is based on

constant returns to scale
it represent those
which of the following istrue in relation to an ISO-Quant combinations of two factors
51
curve? of production that will give rhe
sme level of output
52 production is defined as creation of utility in matter
53 long period production function is related to
laws of returns to scale
The conclusion drawn from Cobb-Douglas production
function function is that labour contributed about
54
….......... And capital about…......... Of the increase in
manfacturing production 3th/4, 1th/4

55 ISoquants are also known as

production indifference curves

56 Human capital refers to

human skills and abilities

57 The law of variable proportions is associated with

short period
58 Which one of the following statements is not correct?
capital is nature's gift

59 Which of the following is not a characteristics of labour

labour is not mobile
60 Which among the following is not charactistics of land
it is an active factor
 when average product raises as a result of an increase in
61
the quantity of variable factor, marginal product is
more than average product
suppose the first four units of a variable input generate
corresponding total output of 150,200,350,550. what will
62
be the
marginal product of the third unit of input 150
The famous Cobb-Douglas production function is based
63 on studies of….......... Industries in the United States of
America manufacturing
In economics, entire process of …........ Is nothing but
64
creation of utilities in form of goods and services production

65 Cobb Douglas function is given by Q = KLaCb If ∞ + β > 1, increasing returns

o scale
66 production is defined as
creation of utility in matter
The conclusion drown from Cobb Douglas production
function is that labour contributed about _________ and
67
capital about _______of the increase in the
manufacturing production 3/4, 1/4

68 A the point of inflextion, the marginal product is

maximum
69 Isoquante's are equal to
Product lines
external and internal
70 Increasing returns to scale can be explained in terms of
economics
According to Cobb-Douglas production function, will get
71
____ returns to scale Constant
Land is a passive factor
Which of the following statement about factors of Land is a free gift of nature
72
production is not true? Land is immobile
Land is perishable
Helping a blind person in
crossing the road
Group dance performance in a
Which of the following is considered as production in collage annual function
73
economics? Holding a child who is falling
from a wall
Performance an art in a
theatre
When marginal product is at a
maximum,
Marginal, average and total product of a firm in the
74 average product is equal to
short run will not comprise with
marginal product, and total
product is rising.

75 Supply of land is __________ in case of economy?

Perfectly inelastic
76 MP is the slope of
TP

From question 77 - 79 used the data table given below

77 What will be total output for 2 workers

18

78 What will be amrginal output for 3 workers?

6
79 Average product for three labour
8
80 The concept innovative entrepreneurship was given by
Schumpter
81 Which activitu is the base of all the production activities
Investment
When out increases more han the increase in input it External and Internal
82
occurs due to economies
A functional relationship between inputs and output is
83
called Production function
Among the following statements which is incorrect in
84
relation to isoquants Isoquants are convex to origin
Technologies external
85 External economics can be achieved through
economies
86 Marginal Product will be ___- at the point of inflextion is
Maximum
87 Production may be defined as an act of
Creating utiltiy

What is produced units when

all factors of production are
employed at optimum
efficiency?
Which of the following is correct in relation to Marginal The extra output obtained
88
Product from employing an additional
unit of factor
The left revenue to the
entrepreneur after he has
incurred all expenses
None of the above.
 According to Cobb-Douglas production function, labour
89
contribution in increasing manufacturing production is 03-Apr
When Average Production falls, marginal product is ___
90
the Average Product Less than
91 How many kinds are of Economies of Scale
2
In short run the Law of Variable Proportions is also
92
known as Law of Diminishing returns
93 The Law of returns to scale is
Long run
Land
94 Which of the following is not passive facor for Production Building
Labour
Machine
Risk and Uncernatiy bearing
Initiating a business enterprise
Which one of the the following is not a necessary finction
95 Innovations
of an entrepreneur
Supervision of day to day
production activities