Q1 · hard · AI-verified
Which of the following is a characteristic feature of monopolistic competition but NOT of perfect competition?
- Large number of buyers and sellers
- Free entry and exit of firms
- Price-taking behaviour by firms
- Product differentiation
Q2 · hard · AI-verified
When consumer income rises by 20% and the demand for a good falls by 10%, the income elasticity of demand is −0.5. This good is classified as:
- A Giffen good
- A luxury good
- A normal good
- An inferior good
Q3 · hard · AI-verified
The 'invisible hand' concept in economics, which suggests that self-interested individuals inadvertently benefit society through market mechanisms, was propounded by:
- Alfred Marshall
- John Maynard Keynes
- David Ricardo
- Adam Smith
Q4 · hard · AI-verified
A farmer sells wheat to a trader at ₹20/kg. The trader sells it to a wholesaler at ₹25/kg, the wholesaler to a retailer at ₹32/kg, and the retailer to a consumer at ₹40/kg. What is the total margin earned by the trader and wholesaler combined?
- ₹20/kg
- ₹17/kg
- ₹7/kg
- ₹12/kg
Q5 · hard · AI-verified
Which market structure is characterised by a single buyer having significant power over the price it pays to many sellers?
- Oligopoly
- Duopsony
- Monopoly
- Monopsony