CBSE - +2 (HSC) Economics - Consumer Equilibrium and Demand

CLASS:- XII SUBJECT:-ECONOMICS

LESSON-02- CONSUMER’ EQUILIBRIUM AND DEMAND

1-Additional utility derived from the consumption of an additional unit of a commodity is called:

a)Average utility

b)Total utility

c)Marginal utility

d)None

Ans:-C

2-According to law of diminishing marginal utility , while eating cake the satisfaction derived from the second slice of it consumed is :

a)Greater than the consumption of first slice

b)Less than the consumption of first slice

c)Not comparable to that from the first

d)Equal to that from the first

Ans:-B

3-Hitesh buy a pizza and coke. The marginal utility of last piece of pizza is 80 utils and of last sip of coke is 40 utils . The price of pizza is Rs 40 and that of coke is Rs 20. This means that Hitesh is buying :

a)More pizza and less coke

b)More coke and less pizza

c)Both at optimal level

d)Same quantity of both

Ans:-C

4-What happens toMU when TU is maximum?

a)MU becomes zero

b)MU becomes negative

c)MU declines

d)MU remain same

Ans:-A

5-The slope of indifference curve is equal to:

a)Marginal utility

b)Marginal rate of substitution

c)One

d)None of the above

Ans:-B

6-Why is indifference curve convex to origin?

a)Due to law of diminishing marginal utility

b)Due to monotonic preferences

c)Due to the continuous decline of marginal rate of substitution

d)Both a and b

Ans:-C

7-It is the property of indifference curve that no two indifference curves can intersect each other. The reason behind this is:

a)Consumer preferences are monotonic

b)Preferences are complete

c)Some combination of two goods cannot give different level of satisfaction

d)Diminishing marginal rate of substitution

Ans:-C

8-Slope of budget line is:

a)Px/Py

b)Py/Px

c)Mrs

d)Px.Py

Ans:-A

9-Which of the following is not the property of indifference curve?

a)Higher the indifference curve higher the level of satisfaction

b)Two indifference curve cannot interest each other

c)Indifference Curve is concave to origin

d)Indifference curve is downward sloping

Ans:-C

10-According to law of demand,other things being constant:

a)There exists negative relationship between quantity demanded and price of a commodity

b)With increase in price, there is rightward shift in demand curve

c)There exists positive relationship between quantity demanded and price of a comoditty

d)with increase in price, there is leftward shift in demand curve

Ans:-A

11-A rise in income of the consumer X leads to a fall in the demand for that good by that consumer. What is the good A called?

a)Complemantary good

b)Substitute good

c)Inferior good

d)Normal good

Ans:-C

12-How will the demand of sugar change if price of tea rises?

a)Decrease because both the goods are complementary

b)Increase because both the goods are substitutes

c)Not change unless the price of sugar changes

d)None of the above

Ans:-A

13-Goods X and Y are complimentary While goods X and Y are substitutes. What will happen to good Y and Z if price of good X increases:

a)The demand for good Y will decrease and for Z will increase

b)The demand for both goods Y and Z will decrease

c) The demand for both goods Y and Z will increase

d) The demand for good Y will increase and for Z will decrease

Ans:-A

14-When demand for a good falls due to rise in its own price , What is the change in demand called?

a)Fall in quantity demanded

b)Contraction demand

c)Fall in demand

d)Both a and b

Ans:-D

15-The price of good X and the quantity demanded of Y bear a positive relationship between each other. What could be the reason behind that?

a)X and Y are substitutes

b)X and Y are complementary goods

c)Y is an inferior good while X is an normal good

d)None of the above

Ans:-A

16-What causes rightward shift in the demand curve ?

a)Fall in the price of the good

b)Fall in the price of substitute good

c) Fall in the price of complementary good

d)Both b and c

Ans:-C

17-Market demand curve for soups is given and known to us. With the onset of cold whether , price remaining the same the consumer would:

a)Move to a higher demand curve

b)Move downward long same demand curve

c)Move to a lower demand curve

d) Moveupward long same demand curve

Ans:-A

18-Price elasticity of demand is defined as:

a)The ratio of change in price to change in quantity demanded

b)Ratio in change in quantity demanded to change the price

c)Ratio of percentage change in quantity demanded to percentage change in price

d)Ratio of proportionate change in price due to proportionate change in quantity demanded

Ans:-C

19-What will be the elasticity of demand curve that is a horizontal line in parallel to X-axis?

a)Zero

b)Unity

c)Ed>1

d)Infinity

Ans:-D

20-What is the value of elasticity of demand on rectangular Hyperbola demand curve?

a) Infinity

b) Unity

c) Zero

d) Ed>1

Ans:-B

21-The value of price elasticity of demand for a demand curve with vertical line parallel to y-axis is:

a)Zero

b)Infinity

c)One

d)Less than one

Ans:-A

22-Total expenditureby Ashim remains the same even after the price of apples fall.According to total expenditure approach , what could be the elasticity of demand?

a)Perfectly elastic

b) Perfectly inelastic

c) Unitary elastic

d) More than unitary elastic

Ans:-C

23-Demand for water is inelastic because:

a)It is abundant

b)It is necessary

c)Its use can be postponed

d)None of the above

Ans:-B

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CBSE - +2 (HSC) Economics - Consumer Equilibrium and Demand

Monday, June 20, 2016