B.COM Eco-1 (Cost Analysis) MCQ's




Question 61 :
The increase in cost due to increase in efficiency is called learning curve effect.

  1. TRUE
  2. FALSE
  

Question 62 :
Learning curve indicate increase in cost of production to the decrease in output.

  1. TRUE
  2. FALSE
  

Question 63 :
The fundamental difference between economic cost and accounting cost is :

  1. Conditional
  2. Pyschological
  3. Academic
  4. Implicity and Explicity
  

Question 64 :
Fixed costs refer to :

  1. Contractual payments
  2. Labour costs
  3. Out of pocket expenses
  4. Business payments
  

Question 65 :
At zero level of output, total cost of a firm is :

  1. equal to zero
  2. equal to variable costs
  3. equal to marginal cost
  4. equal to variable costs
  

Question 66 :
When average cost is maximum :

  1. Marginal cost is minimum
  2. Marginal cost is equal to average cost
  3. Marginal cost is also maximum
  4. Total cost is minimum
  

Question 67 :
The short–run AVC curve moves upward owing to :

  1. Increasing returns to scale
  2. Rising overhead costs
  3. Diseconomies
  4. Diminishing returns
  

Question 68 :
Increasing long–run average cost is attributed to :

  1. the firm’s experience of increasing returns
  2. the firm’s experience of economies of scale
  3. decreasing returns to the scale
  4. increasing average variable cost curve
  

Question 69 :
When LAC curve intersect the LMC curve it implies :

  1. the point of increasing returns
  2. the optimum plant size
  3. the end of economies of scale
  4. none of the above
  

Question 70 :
Division of labour results into :

  1. Rising costs
  2. Diminishing returns
  3. Labour economy
  4. Economies of scale
  

Question 71 :
In long–run :

  1. all costs are variable
  2. costs are divided into fixed and variable costs
  3. costs tends to constant
  4. shape of LAC is always ‘L’
  

Question 72 :
______ is the cost that has already been incurred and which cannot be recovered

  1. Fixed cost
  2. Sunk cost
  3. Private cost
  4. Social cost
  

Question 73 :
Fixed cost is regarded as ______ cost

  1. unavoidable
  2. variable
  3. avoidable
  4. none of the above
  

Question 74 :
Electricity charges, sales tax etc. are examples of ______ cost.

  1. Fixed
  2. Variable
  3. Private
  4. Social
  

Question 75 :
______ is not related to the level of output

  1. Total cost
  2. Total variable cost
  3. Total fixed cost
  4. average cost
  

Question 76 :
______ is obtained by dividing TC by the level of output produced

  1. Average fixed cost
  2. Average variable
  3. Total fixed cost
  4. Average total cost
  

Question 77 :
A firm’s ______ is the sum of total fixed costs and total variable cost at each level of output

  1. Average fixed cost
  2. Average variable cost
  3. Total cost
  4. None of these
  

Question 78 :
The LAC curve is also referred as ______

  1. envelope curve
  2. planning curve
  3. both (a) and (b)
  4. None of the above
  

Question 79 :
The rent of a factory is an example of ______

  1. variable cost
  2. fixed cost
  3. both a and b
  4. Neither a nor b
  

Question 80 :
Which of the following curves is used for planning ______

  1. SAC
  2. SMC
  3. LAC
  4. LMC
  

Question 81 :
Under constant costs conditions or constant returns to scale :

  1. Economies of scale are continuously interacting
  2. LAC and LMC curves coincide
  3. LMC > LAC
  4. The management is steady
  

Question 82 :
The reduction in cost due to increase in efficiency is referred as ______.

  1. income effect
  2. price effect
  3. Learning curve effect
  4. all of the above
  

Question 83 :
The downward slope of LAC curve is subject to the ______.

  1. internal economies
  2. economies and diseconomies
  3. internal diseconomies
  4. external diseconomies
  

Question 84 :
______ causes LAC curve to rise

  1. Internal economies
  2. Economies and diseconomies
  3. External diseconomies
  4. External economies
  

Question 85 :
The Learning curve slopes downward showing a ______ in the cost per unit of output.

  1. increase
  2. decline
  3. both (a) and (b)
  4. None of these
  
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