True/False

Question 11 Mark

When MR falls, AR falls. (True/ False)

Answer

True.

Explanation:

AR and MR both decreases.

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Question 21 Mark

When average revenue falls marginal revenue falls faster than average revenue. (True/ False)

Answer

True.

Explanation:

MR decreases at the rate of twice than AR.

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Question 31 Mark

Oligopoly is a form of the market in which there are large sellers of a commodity and a large number of buyers. (True/ False)

Answer

False.

Explanation:

Oligopoly is a form of the market in which there are a few big sellers of a commodity and a large number of buyers.

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Question 41 Mark

Non-collusive oligopoly is that form of oligopoly in which all the firms determine price and quantity of output on the basis of cooperative behavior. (True/ False)

Answer

False.

Explanation:

Collusive oligopoly is that form of oligopoly in which all the firms determine price and quantity of output on the basis of cooperative behavior.

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Question 51 Mark

Giving reasons, state whether the following statements are true or false.
Under oligopoly, there are large number of buyers and sellers.

Answer

False.
Explanation:
In oligopoly there are a few sellers and a large number of buyers.

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Question 61 Mark

Giving reasons, state whether the following statements are true or false.
Under monopoly new firms can enter the industry to raise the supply.

Answer

False.
Explanation:
In monopoly, no other firm can enter into industry because of barrier created by monopoly firm.

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Question 71 Mark

Giving reasons, state whether the following statements are true or false.
Under monopoly all firms can sell at any price.

Answer

False.
Explanation:
Under monopoly there is only one firm.

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Question 81 Mark

Giving reasons, state whether the following statements are true or false.
Under monopoly a firm sells the goods at a single price.

Answer

False.
Explanation:
Under monopoly a firm can sell all of its output at different prices due to its complete control over supply and market.

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Question 91 Mark

Giving reasons, state whether the following statements are true or false.
Under monopolistic competition there is only one seller of the product.

Answer

False.
Explanation:
Under monopolistic competition, there are large number of buyers and also large number of sellers.

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Question 101 Mark

Giving reasons, state whether the following statements are true or false.
Under monopolistic competition price discrimination can be made easily.

Answer

False.
Explanation:
There is no possibility of price discrimination in the sales of goods in this market because of product differentiation.

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Question 111 Mark

Giving reasons, state whether the following statements are true or false.
Under monopolistic competition, all the customers have perfect knowledge of the market conditions.

Answer

False.
Explanation:
Under monopolistic competition there is a large variety of a single product, so they do not get perfect knowledge of the market conditions.

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Question 121 Mark

Giving reasons, state whether the following statements are true or false.
Under monopolistic competition, a firm faces a perfectly elastic demand curve.

Answer

False.
Explanation:
Monopolistic competitive firm faces downward sloping demand curve as it can sell more only by lowering the price.

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Question 131 Mark

Giving reasons, state whether the following statements are true or false.
In monopoly, firm is different from industry.

Answer

False.
Explanation:
There is only one firm in monopoly market, so there exists no difference between firm and industry.

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Question 141 Mark

AR curve always remain above MR curve. (True/ False)

Answer

True.

Explanation:

MR becomes zero and negative but AR can never be zero.

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Question 151 Mark

A monopolist can sell any quantity he likes at a price. Give reasons with true or false.

Answer

False.

Explanation:

A monopolist cannot sell any quantity he likes at a price.
A monopolist faces a downward sloping demand curve because of price discrimination which means that a monopolist can sell more quantity only by lowering the price.
A monopolist controls only the supply of the product and not the demand of the product.

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