A production function shows the relationship between:

Inputs used and the maximum output that can be produced

The price of output and the quantity demanded

The wage of labour and the rent of capital

Total cost and the quantity of output sold

The main reason why the application of more units of a variable factor to a fixed factor eventually leads to diminishing marginal product is:

The variable factor becomes too abundant relative to the fixed factor

The variable factor becomes more efficient with each extra unit

All factors are being increased in the same proportion

The fixed factor is continuously increased along with the variable factor

Chapter testEconomicsIncluded in the seriesTest 13 of 26

CBSE Class 12 Commerce Economics · Ch 3: Production and Costs

CBSE Class 12 Commerce Economics · Ch 3: Production and Costs is an online chapter test in the CBSE Class 12 Commerce pattern, covering Production and Costs. Attempt it on SeatBeat with a timer like the real exam, then see a detailed solution for every question and your score and weak-topic analysis.

Questions

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Negative marking

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Topics in this test

Topic	Subject	Questions
Production and Costs	Economics	30

Difficulty: 7 medium · 23 hard

Production and Costs MCQ questions with answers

The first 3 of 30 questions. Unlock the series for the rest, each with a solution.

Q1. At zero level of output in the short run, a firm's Total Cost is equal to:
अल्पकाल में उत्पादन के शून्य स्तर पर, किसी फर्म की कुल लागत किसके बराबर होती है:
- A. Total Variable Cost / कुल परिवर्ती लागत
- B. Marginal Cost / सीमांत लागत
- C. Total Fixed Cost / कुल स्थिर लागत
- D. Zero / शून्य
Solution
At zero output Total Variable Cost is zero, so Total Cost equals Total Fixed Cost, which must be paid even when nothing is produced.
शून्य उत्पादन पर कुल परिवर्ती लागत शून्य होती है, इसलिए कुल लागत कुल स्थिर लागत के बराबर होती है, जिसे कुछ भी उत्पादित न होने पर भी चुकाना पड़ता है।
Q2. A production function shows the relationship between:
एक उत्पादन फलन किसके बीच संबंध दर्शाता है:
- A. The price of output and the quantity demanded / उत्पादन की कीमत और माँगी गई मात्रा
- B. The wage of labour and the rent of capital / श्रम की मजदूरी और पूँजी का किराया
- C. Inputs used and the maximum output that can be produced / प्रयुक्त आगत और उत्पादित की जा सकने वाली अधिकतम उत्पादन मात्रा
- D. Total cost and the quantity of output sold / कुल लागत और बेची गई उत्पादन मात्रा
Solution
The production function expresses the maximum quantity of output a firm can produce from different combinations of inputs, given the technology.
उत्पादन फलन, दी गई तकनीक के साथ, आगतों के विभिन्न संयोजनों से किसी फर्म द्वारा उत्पादित की जा सकने वाली अधिकतम उत्पादन मात्रा को व्यक्त करता है।
Q3. The main reason why the application of more units of a variable factor to a fixed factor eventually leads to diminishing marginal product is:
किसी स्थिर साधन पर किसी परिवर्ती साधन की अधिक इकाइयों का प्रयोग अंततः ह्रासमान सीमांत उत्पाद की ओर क्यों ले जाता है, इसका मुख्य कारण है:
- A. The variable factor becomes more efficient with each extra unit / प्रत्येक अतिरिक्त इकाई के साथ परिवर्ती साधन अधिक कुशल हो जाता है
- B. All factors are being increased in the same proportion / सभी साधनों को समान अनुपात में बढ़ाया जा रहा है
- C. The fixed factor is continuously increased along with the variable factor / स्थिर साधन को परिवर्ती साधन के साथ लगातार बढ़ाया जाता है
- D. The variable factor becomes too abundant relative to the fixed factor / परिवर्ती साधन स्थिर साधन की तुलना में अत्यधिक प्रचुर हो जाता है
Solution
As the fixed factor stays constant, after a point each additional variable unit gets a smaller share of the fixed factor, so the factor proportion becomes less ideal and MP falls.
चूँकि स्थिर साधन स्थिर रहता है, एक बिंदु के बाद प्रत्येक अतिरिक्त परिवर्ती इकाई को स्थिर साधन का छोटा हिस्सा मिलता है, इसलिए साधन अनुपात कम आदर्श हो जाता है और MP घटती है।

Frequently asked questions

How many questions are in the CBSE Class 12 Commerce Economics · Ch 3: Production and Costs?

30 questions for 30 marks, to be answered in 20 minutes.

Is there negative marking in the CBSE Class 12 Commerce Economics · Ch 3: Production and Costs?

No — wrong answers are not penalised in this test.

Which topics does the CBSE Class 12 Commerce Economics · Ch 3: Production and Costs cover?

Production and Costs (30 questions).

Is the CBSE Class 12 Commerce Economics · Ch 3: Production and Costs free?

It is part of the CBSE Class 12 Commerce Test Series 2027 — Chapter-wise + Full Tests (26 tests, ₹199). You can first try Accountancy · Ch 1: Accounting for Partnership: Basic Concepts for free.

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