The transformation curve slopes indicate that
Opportunity cost of producing one commodity for another
Opportunity cost of producing two commodities at a time
Sales of the plants to other investors
Decrease in the cost of production
Correct answer is A
The transformation curve shows the amount of commodity X that the economy has to give up to obtain an additional unit of commodity Y (and vice versa). It simply shows the opportunity cost of producing one thing against another (the forgone alternative to get something else).
In the long run all factors of production are
Expensive
Variable
Durable
Fixed
Correct answer is B
The long run is a period in production where factors of production are variable/changes.
Small scale enterprises are important in a country because
They usually produce goods for the dependants
They provide after-sales service only to the rich
The price of their products are fixed
They render personalized service to the consumers
Correct answer is D
Small scale enterprises are important as they offer personalized customer service. These services refers to delivering customized services that cater to the exact needs and wants of the customer.
If the co-efficient of elasticity of demand is 1.5, then the demand is
Fairly inelastic
Perfectly elastic
Elastic
Inelastic
Correct answer is C
A 1.5 co-efficient of elasticity of demand means that the demand is elastic. This means that a small change in price leads to a large change in quantity demanded. Meaning the product is elastic (or sensitive to price changes).
Which of the following determinants of supply cannot be predicted easily?
Price of the commodity
New techniques of production
National emergencies
Mobility of labour
Correct answer is C
National emergencies are unforeseen events that affect a geographical location, hence leading to a stop or slow down economic activities. An example of such is an outbreak of an epidemic, wars, natural disasters, etc. These emergencies are unpredictable and as such can cause a change in supply.