The limit on the consumption bundles that a consumer can afford is known as ?

A. An indifference curve
B. The budget constraint
C. The marginal rate of substitution
D. The consumption limits

indifference curves for perfect substitutes are ?

A. Right angles
B. Bowed outward
C. Straight lines
D. Nonexistent

uppose a consumer must choose between the consumption of sandwiches and pizza. If we measure the quantity of pizza on the horizontal axis and the quantity of sandwiches on the vertical axis and if the price of a pizza is Rs10 and the price of a sandwich is Rs5, then the slope of the budget constraint is ?

A. 2
B. 10
C. 1/2
D. 5

Which of the following statements is not true with regard to the standard properties of indifference curves ?

A. Indifference curves are downward sloping
B. Indifference curves are bowed outward
C. Indifference curves do not cross each other
D. Higher indifference curve is preferred to lower ones

Which of the following is true about the consumer’s optimum consumption bundle? At the optimum ?

A. the slope of the indifference curve equals the slope of the budget constraint
B. the indifference curve is tangent to the budget constraint
C. the relative prices of the two goods equals the marginal rate of substitution
D. none of these answers are true

If an increase in a consumer’s income causes the consumer to increase his quantity demand of a good, then the good is ?

A. A complementary good
B. An inferior good
C. A normal good
D. A substitute good

Refer to Exhibit 4. Suppose that the consumer must choose between buying socks and belts Also suppose that the consumer’s income is €100 If the price of a belt is €10 and the price of a pair of socks is €5, the consumer will choose to buy the commodity bundle represented b point ?

A. Z
B. X
C. Y
D. The optimal point cannot be determined from this graph

In monopolistic competition ?

A. Demand is perfectly elastic
B. Products are homogeneous
C. Marginal revenue = price
D. The marginal revenue is below the demand curve and diverges

Which of the following is not one of the four Ps in marketing ?

A. Product
B. Price
C. Place
D. Presence

In monopolistic competition of firms are making abnormal profit other firms will enter and ?

A. The marginal cost will shift outwards
B. The demand curve will shift inwards
C. The average cost will shift downwards
D. The average variable cost will increase