{"id":51650,"date":"2024-04-15T23:27:52","date_gmt":"2024-04-15T23:27:52","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=51650"},"modified":"2024-04-15T23:27:52","modified_gmt":"2024-04-15T23:27:52","slug":"match-the-following-list-i-list-ii-a-cross-elasticity-is-zero-1-price-avc-b-shut-down-point-2-two-commodities-are-independent-c-slutskey-theorem-3-transformation-line-d-production-possibilit","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/match-the-following-list-i-list-ii-a-cross-elasticity-is-zero-1-price-avc-b-shut-down-point-2-two-commodities-are-independent-c-slutskey-theorem-3-transformation-line-d-production-possibilit\/","title":{"rendered":"Match the following. List-I List-II a. Cross elasticity is zero 1. Price = AVC b. Shut down point 2. Two commodities are independent c. Slutskey theorem 3. Transformation line d. Production possibility 4. Substitution effect"},"content":{"rendered":"<p>[amp_mcq option1=&#8221;a-2, b-4, c-1, d-3&#8243; option2=&#8221;a-3, b-2, c-1, d-4&#8243; option3=&#8221;a-1, b-3, c-2, d-4&#8243; option4=&#8221;a-2, b-1, c-4, d-3&#8243; correct=&#8221;option4&#8243;]<!--more--><\/p>\n<p>The correct answer is: <strong>D. a-2, b-1, c-4, d-3<\/strong><\/p>\n<ul>\n<li><strong>a. Cross elasticity is zero<\/strong><\/li>\n<\/ul>\n<p>Cross elasticity of demand is a measure of how responsive the demand for one good is to a change in the price of another good. If the cross elasticity of demand is zero, it means that the two goods are independent, and a change in the price of one good will not have any effect on the demand for the other good.<\/p>\n<ul>\n<li><strong>b. Shut down point<\/strong><\/li>\n<\/ul>\n<p>The shut down point is the point at which a firm is producing no output and is just breaking even. At this point, the firm&#8217;s revenue is equal to its variable costs, and its profits are zero.<\/p>\n<ul>\n<li><strong>c. Slutskey theorem<\/strong><\/li>\n<\/ul>\n<p>The Slutskey theorem is a theorem in economics that states that the total effect of a change in price on demand can be decomposed into two effects: the substitution effect and the income effect. The substitution effect is the effect of a change in price on the relative prices of goods, and the income effect is the effect of a change in price on real income.<\/p>\n<ul>\n<li><strong>d. Production possibility<\/strong><\/li>\n<\/ul>\n<p>The production possibility frontier is a curve that shows the maximum combination of goods that can be produced with a given amount of resources. It is a graphical representation of the law of diminishing returns.<\/p>\n<p>I hope this helps! Let me know if you have any other questions.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>[amp_mcq option1=&#8221;a-2, b-4, c-1, d-3&#8243; option2=&#8221;a-3, b-2, c-1, d-4&#8243; option3=&#8221;a-1, b-3, c-2, d-4&#8243; option4=&#8221;a-2, b-1, c-4, d-3&#8243; correct=&#8221;option4&#8243;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"class_list":["post-51650","post","type-post","status-publish","format-standard","hentry","category-economics","no-featured-image-padding"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.2 (Yoast SEO v23.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Match the following. List-I List-II a. Cross elasticity is zero 1. Price = AVC b. Shut down point 2. Two commodities are independent c. Slutskey theorem 3. Transformation line d. 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