Business Economics

11. Perfect competition is characterized by

  1. large number of buyers and sellers
  2. homogeneous product
  3. free entry and exit of firms
  4. all the above
Correct answer: (D)
all the above

12. The distinction between variable cost and fixed cost is relevant only in

  1. long period
  2. short period
  3. medium term
  4. mixed period
Correct answer: (B)
short period

13. Purposes of Short term Demand forecasting doesn’t includes;

  1. Making a suitable production policy.
  2. To reduce the cost of purchasing raw materials and to control inventory.
  3. Deciding suitable price policy
  4. Planning of a new unit or expansion of existing unit
Correct answer: (D)
Planning of a new unit or expansion of existing unit

14. In ______________ approach, the demand for new product is estimated on the basis demand of existing product

  1. Growth curve approach
  2. Evolutionary approach.
  3. Opinion polling approach
  4. Vicarious approach.
Correct answer: (B)
Evolutionary approach.

15. The proportionate change in the quantity demanded of a commodity in response to change in the price of another related commodity is called

  1. Price elasticity
  2. Related elasticity
  3. Cross elasticity
  4. Income elasticity
Correct answer: (C)
Cross elasticity

16. Which one is the method for measurement of elasticity

  1. Proportional or Percentage Method
  2. Outlay Method
  3. Geometric method
  4. All the above
Correct answer: (D)
All the above

17. ______________ Method is also known as Sales-Force – Composite method or collective opinion method

  1. Opinion survey
  2. Expert opinion
  3. Delphi method
  4. Consumer interview method
Correct answer: (A)
Opinion survey

18. Which of the following is not a method of demand forecasting of new products

  1. Trend projection
  2. Substitute approach
  3. Evolutionary approach
  4. Sales experience approach
Correct answer: (A)
Trend projection

19. Psychological pricing is also called as;

  1. Penetration pricing
  2. Skimming pricing
  3. Odd pricing
  4. None of these
Correct answer: (C)
Odd pricing

20. Customary pricing is also known as

  1. Consumer pricing
  2. Conventional pricing
  3. Cost plus pricing
  4. Full cost pricing
Correct answer: (B)
Conventional pricing
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