Managerial Economics Online Test Part 3

11. Which of the following are the drawbacks of "Marginal cost pricing policy"?

i] Frequent changes in price
ii] Practical difficulties arise in computation of marginal cost
iii] Profit/ unit
iv] It causes problems in credit sales

a. Only i
b. i, ii and iii
c. i, ii and iv
d. All the above


12. Total revenue - Explicit costs = _________, as per economists.

a. Profit
b. Investment
c. Implicit cost
d. None of the above


13. Variable costs vary with ______

a. Size
b. Scale
c. Input
d. Output


14. Study of income elasticity of demand is useful in

i] Economic planning
ii] Marginal planning
iii] Demand forecasting
iv] Contribution analysis

a. Only i and ii
b. Only i and iii
c. All i, ii and iii
d. Only iv


15. Managerial economics involves forward planning by management. Who said this?

a. Prof. Hague
b. Alfred Marshall
c. Spencer Sieglemen
d. Prof. Jon Darwin