In the context of cost curves, the Marginal Cost curve intersects the Average Cost curve at: MCQ with Answer and Explanation

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In the context of cost curves, the Marginal Cost curve intersects the Average Cost curve at:

A. Its minimum point

B. The origin

C. Any random point

D. Its maximum point

Answer: Option A

Solution (By JKSSB Mock Tests)

The MC curve intersects both the AVC and ATC curves at their respective minimum points.

This question belongs to: Economy GK Economy Set 1

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Practice More Economy Set 1 Questions

Question #1

Which of the following is a feature of a flexible exchange rate system?

A. Complete absence of central bank intervention in all cases

B. Exchange rate is fixed by government decree

C. Exchange rate is determined by market forces of demand and supply of foreign exchange

D. No role for speculation

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Correct Answer: Option C

Explanation:
Under a pure flexible (floating) exchange rate system, the value of the currency is determined by the interaction of demand and supply in the foreign exchange market.

This question belongs to: Economy GK Economy Set 1

Question #2

In the context of the Indian economy, the 'Demographic Dividend' refers to:

A. Increase in the proportion of dependent population

B. Decline in the total population

C. Increase in the old-age population only

D. Economic growth potential from a large working-age population

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Correct Answer: Option D

Explanation:
Demographic dividend arises when a large share of the population is of working age, providing an opportunity for higher economic growth if this workforce is productively employed.

This question belongs to: Economy GK Economy Set 1

Question #3

The 'substitution effect' of a price change always leads consumers to buy:

A. the same amount

B. less of the good whose relative price has fallen

C. only inferior goods

D. more of the good whose relative price has fallen

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Correct Answer: Option D

Explanation:
The substitution effect always causes consumers to buy more of the relatively cheaper good.

This question belongs to: Economy GK Economy Set 1

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