1) Short-run is a time period.

1. In which at least one input is fixed
2. Of three years Duration
3. However long it takes to produce the planned output
4. Of less than six months

2) If a person prefers a certain given income to a risky income with the same expected value, then this person is called as:

1. Irrational
2. Risk neural
3. Risk averse
4. Risk Loving

3) Higher the standard deviation, higher will be the:

1. Risk
2. Probability
3. Outcomes
4. Expected value

4) The like hood that each outcome will occur is known as:

1. Standard deviation
2. Expected value
3. Probability
4. Variability

5) The slope of the total product curve is called:

1. Marginal rate of substitution
2. Marginal Product
3. Average Product
4. Marginal rate of technical substitution

6) Which of the following is NOT considered as tool of reducing risk>

1. Obtaining more information
2. Insurance
3. Diversification
4. Irrational Information

7) Firms can reduce risk by diversifying among a variety of activities which are:

1. Transferable
2. Not closely Related
3. Homogenous
4. Closely related

8) Which of the following is considered as tool of reducing risk

1. Obtaining more information
2. Insurance
3. Diversification
4. All of the given options

9) Marginal rate of technical substitution (MRTS) of two perfectly substitutable inputs is always.

1. Smaller
2. Constant
3. Decreasing
4. Increasing

10) Diversification is a tool which is used by the consumers in which of the following situations:

1. Decrease utility
2. Increase utility
3. Increase risk
4. Decrease risk