Tag: producer's equilibrium

Questions Related to producer's equilibrium

A produce strikes his equilibrium when the difference between $TR$ and $TC$ is maximised.
business economics and quantitative methods equilibrium of a firm shifts in demand and supply producer's equilibrium income-output determination liquidity preference and profit

  1. True

  2. False

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Correct Option: A
Explanation:

A producer strikes his equilibrium when he produces that amount of output at which the difference between total revenue and total cost is maximum. This is because, $\text{Net profit} = TR - TC$.

The producer strikes his equilibrium only when $MP$ is diminishing.
business economics and quantitative methods equilibrium of a firm shifts in demand and supply producer's equilibrium income-output determination liquidity preference and profit

  1. True

  2. False

Show answer
Correct Option: A
Explanation:

A producer strikes his equilibrium only when $MP$ is diminishing, where the $MC$ is simultaneously rising. The producer stops production when rising $MC$ matches with falling $MR$. Beyond this point, rising $MC$ would exceed $MR$, causing loss of profit.

In finding equilibrium position of a profit maximising firm, which technique is most convenient ___________.

business economics and quantitative methods equilibrium of a firm shifts in demand and supply producer's equilibrium income-output determination liquidity preference and profit

  1. total revenue and total cost technique

  2. marginal revenue and marginal cost technique

  3. demand and supply technique

  4. none of the above

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Correct Option: B

A circumstance in which it might pay a monopolist to cut the price of his product is where _________.

business economics and quantitative methods equilibrium of a firm shifts in demand and supply producer's equilibrium income-output determination liquidity preference and profit

  1. MC is falling

  2. MR is greater than MC

  3. his advertising costs are increasing

  4. average costs seem about to fall

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Correct Option: B

The entrepreneur coordinates all the other three factors (land, labour and capital) of production.

economics producer's equilibrium equilibrium of a firm shifts in demand and supply liquidity preference and profit

  1. True

  2. False

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Correct Option: A

Gross Profit = Total Revenue - Total cost.

economics producer's equilibrium equilibrium of a firm shifts in demand and supply liquidity preference and profit

  1. True

  2. False

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Correct Option: A
$TR > TC$ is a situation of ________.
economics producer's equilibrium equilibrium of a firm shifts in demand and supply liquidity preference and profit

  1. normal profit

  2. rising profits

  3. abnormal profits

  4. falling profits

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Correct Option: C

$M p = f (y)$ is denoted for ____________________.

economics producer's equilibrium equilibrium of a firm shifts in demand and supply liquidity preference and profit

  1. Transactionary motive

  2. Precautionary motive

  3. Speculative motive

  4. demand for money

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Correct Option: B

What are the kinds/types of Profits?

economics producer's equilibrium equilibrium of a firm shifts in demand and supply liquidity preference and profit

  1. Monopoly Profit.

  2. Windfall Profit.

  3. Profit as functional reward.

  4. all of the above

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Correct Option: D

According to American economist Frank.H.Knight. To him, profit is the reward for uncertainty bearing.

economics producer's equilibrium equilibrium of a firm shifts in demand and supply liquidity preference and profit

  1. True

  2. False

Show answer
Correct Option: A