Class XI Eco Chapter 2 Test Paper 2021 Part-I

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UTILITY ANALYSIS AND CONSUMER EQUILIBRIUM

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1. Which of these is not a property of indifference curve? *

1 point

Indifference curve slopes downwards

Indifference curve is concave to the origin

Two indifference curves cannot intersect each other

Higher indifference curve represents higher level of satisfaction.

2. Indifference curves are convex to the origin because of: *

1 point

Increasing MRS

Diminishing MRS

Law of Diminishing marginal utility

Law of Equi-Marginal Utility

3. The necessary condition under utility approach to attain consumer’s equilibrium in case of two Commodity is: *

1 point

MUx/Px =MUy/py

MRSx=Px /Py

MUx =Px

None of these

4. When we add up utility derived from consumption of all the units of the commodities, we get: *

1 point

Total utility

Initial utility

Marginal Utility

None of these

5. Marginal Utility (MU) in terms of money is equal to: *

1 point

Marginal Utility in utils

Marginal Utility of one rupee / MU in utils

Marginal Utility in utils/Price of the commodity

None of these

6. According to the Law of Diminishing marginal Utility satisfaction obtained from consumption Of each successive unit: *

1 point

Increases

Decreases

Remains

Either increases or decreases

7. Indifference Map refers to: *

1 point

Highest Indifference curve

Lowest Indifference curve

Family of indifference curves

None of these

8. Budget set includes *

1 point

All those combinations of two goods which a consumer already possesses

All those combination of two goods which a consumer cannot afford

All those combination of two goods which a consumer is willing to buy

All those combination of two goods which a consumer can afford

9. Indifference curves are : *

1 point

Concave to the origin

Convex to the origin

Upward sloping straight line passing from the origin

None of these

10. which of these is a condition for consumer’s equilibrium by indifference curve analyse? *

1 point

MUx =Px

MUx/Px = MUy/Py

MRSx =Px/Py

MUx =MUy

11. if MUx/Px>MUy/Py then to reach the equilibrium position, consumer should: *

1 point

Stop buying any commodity.

Buy both the commodities in equal quantity.

Buy more of x and less of Y.

Buy more of Y and less of X

12. If the consumption of an additional unit of a commodity causes no change in TU, then the Resultant MU is: *

1 point

Zero

Positive

Negative

Constant

13. An indifference curve is best described as a series of points which show: *

1 point

Combination of two commodities which give the consumer same satisfaction.

Combination of two goods, such that cost of each combination is equal to money income Of the consumer.

Combinations of the two goods which a consumer can afford given his income and prices In the market.

None of these

14. Total Utility is ______ at the point of satiety: *

1 point

Minimum

Maximum

Zero

None of these

15. Marginal Utility (MU) of nth unit is calculated as: *

1 point

MUn=TUn+1

Option 2

MUn=TUn +TU n-1

MUn=TUn-TUn-1

16. In case of single commodity. Consumer’s equilibrium is achieved when: *

1 point

MUx> Px

MUx<Px

MUx =Py

MUx =Px

17……….. measures the slope of Indifference curve. *

1 point

Budget Line

MRS

MRT.

NOTA

18. In the following diagram of budget line point “D” represents: *

1 point

Bundle which cost equal to money income of consumer

Bundle which cost less than money income of consumer

Bundle which cost greater than money income of consumer

None of these

19. how is TU derived from MU? *

1 point

TU=Σ MU

TU=U1 +u2 +U3 --------- +Un

Both (a) and (b)

None of these

20. what happens to MU when TU is maximum? *

1 point

MU is negative

MU is Zero

MU is decreasing

MU is increasing

21. An indifference curve always: *

1 point

Slopes downwards from left to right.

Slopes upwards from left to right.

Is parallel to the Y-axis

Is parallel to the X-axis.

22. In case of cardinal utility approach, utility is measured in: *

1 point

Rupees

Ranks

Utils

None of these

23. the consumer will be in equilibrium where there is tangency between price line and Indifference curve because at this point: *

1 point

MRS< Price Ratio

MRS<Price Ratio

MRS=Price Ratio

None of these

24. “Cardinality” means utility can be: *

1 point

Measured

Ranked

Not measured

None of these

25. The slope of price line (in case of commodities X and Y) is given by: *

1 point

Taste and preferences of consumer

Prices of both the commodities

Price of commodity X alone

Price of commodity Y alone.

26. Which Law states that: “when a consumer consumes more and more units of a product, the Utility derived from each additional Unit decreases”? *

1 point

Law of Equi-marginal Utility

Law of Ordinal Utility

Law of Cardinal Utility

Law of Diminishing Marginal Utility

27. In the context of Indifference Curve Analysis, MRS stands for: *

1 point

Marginal Rate of Substitution

Marginal Rate of Satisfaction

Marginal Return of substitution

Marginal Return of Satisfaction

28. For consumer’s equilibrium to be stable, the requirement is: *

1 point

Constant MRS

Increasing MRS

Diminishing MRS

None of these

29. The total utility derived by Shyam by eating 6 apples is 300 utils Marginal utility of the 7th Apple is 30 utils. The total utility for 7 apples will be _______ utils. *

1 point

330

270

300

30. The assumption of “Constant marginal utility of money ”means that importance of money to Consumer is: *

1 point

Increasing

Decreasing

Same

None of these

31. When Economists speak of the utility of a certain product, they are referring to: *

1 point

Demand for the Product

Usefulness of the product in consumption

Satisfaction gained from consuming such product

Rate at which consumers are willing to exchange on good for another

32. Utility: *

1 point

Differs from person to person

Differs form time to time

Differs from product to product

All of these

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