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Test: Theory Of Consumer Behaviour - 3 - Commerce MCQ


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25 Questions MCQ Test Economics Class 11 - Test: Theory Of Consumer Behaviour - 3

Test: Theory Of Consumer Behaviour - 3 for Commerce 2024 is part of Economics Class 11 preparation. The Test: Theory Of Consumer Behaviour - 3 questions and answers have been prepared according to the Commerce exam syllabus.The Test: Theory Of Consumer Behaviour - 3 MCQs are made for Commerce 2024 Exam. Find important definitions, questions, notes, meanings, examples, exercises, MCQs and online tests for Test: Theory Of Consumer Behaviour - 3 below.
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Test: Theory Of Consumer Behaviour - 3 - Question 1

 Which of the following statements regarding utility is not true?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 1

Utility is a subjective concept and varies from person to person, at different times and at different places. There cannot be a standardised measure for utility. Therefore, the point that utility always measurable is not true.

Test: Theory Of Consumer Behaviour - 3 - Question 2

 Which of the following utility approach is based on the theory of Alfred Marshall?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 2

Alfred Marshall was the dominant figure in British economics from about 1890 until his death in 1924.His specialty was microeconomics—the study of individual markets and industries, as opposed to the study of the whole economy.
It was Alfred Marshall who first discussed the role played by the theory of utility in the theory of value. In Marshall's theory, the concept of utility is cardinal.

Test: Theory Of Consumer Behaviour - 3 - Question 3

  _____________ is the addition to total utility by the consumption of one additional unit of the commodity?

Test: Theory Of Consumer Behaviour - 3 - Question 4

Which of the following utility approach suggests that utility is a measurable and quantifiable entity?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 4

In cardinal utility approch utility is measured in numerical terms.And unit used for measurement is known as utils.

Test: Theory Of Consumer Behaviour - 3 - Question 5

____________ shows various combinations of two goods that give same amount of satisfaction to the consumer?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 5

On indifference curve,consumer gets same satisfaction from each combination hence he is indifferent towards all combinations.

Test: Theory Of Consumer Behaviour - 3 - Question 6

Indifference curve slopes___________?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 6

In order to increase the consumption of one good,other good must be sacrificed as utility level through out the indifference cure has to be same.Due to inverse relation between two goods indifference curve slopes downwards from left to right.

Test: Theory Of Consumer Behaviour - 3 - Question 7

 _____________ is defined as the difference between what the consumer is willing to pay for a product and what he actually pays?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 7

Consumer surplus happens when the price consumers pay for a product or service is less than the price they're willing to pay. Consumer surplus is the benefit or good feeling of getting a good deal.
Consumer surplus always increases as the price of a good falls and decreases as the price of a good rises.

Test: Theory Of Consumer Behaviour - 3 - Question 8

According to the law of diminishing marginal utility, _________?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 8

As per law of dimnishing marginal utility, as the consumer goes on conuming MU derived from each succesive unit goes on falling,becomes zero and finally turns negative 

Test: Theory Of Consumer Behaviour - 3 - Question 9

The want satisfying power of a commodity is known as:

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 9

utility represents satisfaction experienced by the consumer from a good.

Test: Theory Of Consumer Behaviour - 3 - Question 10

What is called point of satiety?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 10

Point of Satiety is defined as '' the point where marginal utility of any commodity is zero''. Thus it is a point where satisfaction of any commodity is zero.

Test: Theory Of Consumer Behaviour - 3 - Question 11

The total utility divided by the number of units consumed is known as?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 11

Average utility is nothing but utility derived by per unit of consumption.

Test: Theory Of Consumer Behaviour - 3 - Question 12

Utility is measured in terms of?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 12

Measurement unit for utility is known as utils.

Test: Theory Of Consumer Behaviour - 3 - Question 13

The concept of marginal utility was developed by?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 13

MU is the concept used in cardianl utility approch which was given by alferd marshal.

Test: Theory Of Consumer Behaviour - 3 - Question 14

Indifference curve represents?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 14

An indifference curve is a graph showing combination of two goods that give the consumer equal satisfaction and utility.

Test: Theory Of Consumer Behaviour - 3 - Question 15

Consumer’s surplus is also known as?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 15

Consumer surplus, also called social surplus and consumer's surplus, in economics, the difference between the price a consumer pays for an item and the price he would be willing to pay rather than do without it.

Test: Theory Of Consumer Behaviour - 3 - Question 16

An indifference curve is always?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 16

In the case of normal goods indifference curve is always convex.

Test: Theory Of Consumer Behaviour - 3 - Question 17

According to Marshall, the law of diminishing marginal utility applies on ___________?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 17

As per Alferd marshall MU of money is constant.

Test: Theory Of Consumer Behaviour - 3 - Question 18

Consumer’s equilibrium means?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 18

consumer equilibrium is a state of balance  for the consumer from where he doesn’t want to move either forward or backward. This is achieved when consumer gets maximum satisfaction with given income and he doesn’t want to change his way of existing expenditure.

Test: Theory Of Consumer Behaviour - 3 - Question 19

MU1 + MU2 + ……..MUn represents?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 19

Total utility is the total satisfaction received from consuming a given totalquantity of a good or service. It is the sum of marginal utility which can be expressed as:

TU = (MU1 + MU2+ ............ MUn)

Test: Theory Of Consumer Behaviour - 3 - Question 20

A budget constraint line is a result of?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 20

A budget constraint represents all the combinations of goods and services that a consumer may purchase given current prices within his or her given income. Consumer theory uses the concepts of a budget constraint and a preference map to analyze consumer choices.

Test: Theory Of Consumer Behaviour - 3 - Question 21

An indifference curve indicates, ceteris paribus?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 21

An indifference curve is a graph showing combination of two goods that give the consumer equal satisfaction and utility. Each point on an indifference curve indicates that a consumer is indifferent between the two and all points give him the same utility.

Test: Theory Of Consumer Behaviour - 3 - Question 22

The coefficient of price elasticity of demand is always

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 22

There is a negative relation between price of the commodity and its quantity demanded,due to which elasticity coffecient is always negative.

Test: Theory Of Consumer Behaviour - 3 - Question 23

Utility of a good can be explained as a?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 23

Utility represents satisfaction experienced by the consumer from a good.

Test: Theory Of Consumer Behaviour - 3 - Question 24

Which of the following statements regarding ordinal utility is true?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 24

 The Ordinal Utility approach is based on the fact that the utility of a commodity cannot be measured in absolute quantity, but however, it will be possible for a consumer to tell subjectively(by ranking) whether the commodity derives more or less or equal satisfaction when compared to another.

Test: Theory Of Consumer Behaviour - 3 - Question 25

Which of the following curve has a negative slope and cannot interest each other?

Detailed Solution for Test: Theory Of Consumer Behaviour - 3 - Question 25

IC slopes downward because as the consumer increases the consumption of one commodity, he has to give up certain units of other commodity in order to maintain the same level of satisfaction.

two indifference curves represent two different levels of satisfaction. If these indifference curves intersect each other, the intersection will represent same level of satisfaction, which is impossible.

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