Principles Of Economics And Management (3140709) MCQs

MCQs of Theory of Production and Cost

Showing 21 to 30 out of 32 Questions
1 2 3 4
21.
The cost which will never return in any stage of business is called :
(a) Fixed cost
(b) Opportunity cost
(c) Variable cost
(d) Sunk cost
Answer:

Option (d)

22.
Find the odd man out.
(a) Fixed cost
(b) Overheads
(c) Average cost
(d) Indirect cost
Answer:

Option (c)

23.
The benefits of mass production can be seen in ________.
(a) Long-run cost
(b) Marginal cost
(c) Fixed cost
(d) Variable cost
Answer:

Option (b)

24.
The cost of one thing in terms of the alternative given up is called
(a) Fixed cost
(b) Implicit cost
(c) Opportunity cost
(d) Sunk cost
Answer:

Option (c)

25.
Which is not the correct assumption of Break-Even Analysis?
(a) All costs can be separated into fixed and variable components.
(b) Variable costs will fluctuate in direct proportion to the volume of output.
(c) The selling price will remain constant.
(d) Product-mix will change continuously.
Answer:

Option (d)

26.
BEP is a situation where firm is in ____________.
(a) Profit
(b) Loss
(c) No profit no loss
(d) Can not say anything
Answer:

Option (c)

27.
Which is the correct equation of Break-Even Quantity? (Consider FC=Fixed Cost, s=Selling price/unit and v=Variable cost/unit)
(a) BEQ=FC-ss-v(in units)
(b) BEQ=FCs-v(in units)
(c) BEQ=FC+ss-v(in units)
(d) BEQ=FC×ss-v(in units)
Answer:

Option (b)

28.
Which is the application of Break-Even Analysis?
(a) It helps in the determination of selling price which will give the desired profits.
(b) It helps in the fixation of sales volume to cover a given return on capital employed.
(c) It gives suggestions for the shift in the sales mix.
(d) All of these
Answer:

Option (d)

29.
Contribution = _______________.
(a) Sales * Variable costs
(b) Sales / Variable costs
(c) Sales - Variable costs
(d) Sales + Variable costs
Answer:

Option (c)

30.
Which is the correct equation of the Margin of Safety?
(a) M.S.=Sales + Break-even sales
(b) M.S.=Sales - Break-even sales
(c) M.S.=Sales * Break-even sales
(d) M.S.=Sales / Break-even sales
Answer:

Option (b)

Showing 21 to 30 out of 32 Questions
1 2 3 4