| Units of Output | Marginal Revenue (₹) | Marginal Cost (₹) |
| 1 | 20 | 20 |
| 2 | 20 | 10 |
| 3 | 20 | 6 |
| 4 | 20 | 4 |
| 5 | 20 | 20 |
| 6 | 20 | 30 |
1. On the basis of the data given above, the producer's equilibrium is struck when output level is
(a) 1 unit (b) 2 units (c) 5 units (d) 6 units
2. On the basis of your answer of the above question, the profit at the equilibrium output is
(a) 0 (b) 10 (c) 24 (d) 40
3. Which of the following is correct?
(a) Producer's equilibrium is struck at that level of output where profit is maximised
(b) Net profit refers to the difference between TR and TC
(c) Normal profits are a part of TC
(d) All of these
4. Identify the correct formula to calculate Gross Profits.
(a) Gross Profits = TR-TFC
(b) Gross Profits = TR-TVC
(c) Gross Profits = TR - TC
(d) Gross Profits TR-TFC-TVC
5. Read the following statements carefully and choose the correct alternative among those given below:
Statement 1: In case MR > MC, we can increase profit by increasing output.
Statement 2: A firm will always finds its equilibrium output under falling MC.
Alternatives:
(a) Both the statements are true
(b) Both the statements are false
(c) Statement 1 is true and Statement 2 is false
(d) Statement 2 is true and Statement 1 is false
6. In which stage of production, a producer attains his equilibrium?
(a) In the first stage of production
(b) In the second stage of production
(c) In the third stage of production
(d) In all the above stages of production