Which of the following is a feature of the long-run average cost curve under increasing returns to scale? MCQ with Answer and Explanation

Question
Which of the following is a feature of the long-run average cost curve under increasing returns to scale?
A. It is upward sloping
B. It is downward sloping
C. It is U-shaped only due to fixed factors
D. It is horizontal
Answer: Option B
Solution (By JKSSB Mock Tests)
Under increasing returns to scale, long-run average cost falls as output expands, resulting in a downward-sloping LAC curve over the relevant range.
This question belongs to: Economy GK Economy Set 1
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Question #1
Which of the following is a feature of the 'Special Drawing Rights' allocation by the IMF?
A. SDRs are a form of private cryptocurrency
B. SDRs are only available to countries with balance-of-payments needs under strict conditionality
C. A general allocation of SDRs provides unconditional liquidity to member countries in proportion to their quotas
D. SDRs can be used only for domestic fiscal spending
Discuss
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Correct Answer: Option C

Explanation:
A general SDR allocation distributes new SDRs to all IMF members in proportion to their quotas, thereby increasing global liquidity without the policy conditionality attached to IMF lending programmes.
This question belongs to: Economy GK Economy Set 1
Question #2
The 'Demands for Grants' are part of:
A. foreign trade policy
B. stock market
C. monetary policy
D. Union Budget
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Correct Answer: Option D

Explanation:
Demands for Grants are part of the Union Budget.
This question belongs to: Economy GK Economy Set 1
Question #3
The 'Contingency Fund of India' is held by:
A. Prime Minister
B. RBI
C. President
D. Finance Minister
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Correct Answer: Option C

Explanation:
The Contingency Fund of India is placed at the disposal of the President.
This question belongs to: Economy GK Economy Set 1
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