CMA Foundation MCQ Quiz Economics Lesson 1.5 – Part 2April 9, 2026 Maven Leave a Comment Welcome to the CMA Foundation MCQ Quiz Economics Lesson 1.5 - Part 2 quiz! Name Email 1. Economies of scale refer to: Increase in per unit cost as output increases Increase in total cost as output increases Reduction in per unit cost as output increases Reduction in total cost as output decreases None 2. Internal economies are advantages that accrue to: A single firm when it expands its own scale of production All firms in the industry when the industry expands The government when private firms expand Consumers when firms reduce their prices None 3. Division of labour and specialisation are examples of which type of internal economy? Technical economies Financial economies Labour economies Marketing economies None 4. A large firm installing high capacity machines and adopting latest technology is an example of: Labour economies Managerial economies Risk bearing economies Technical economies None 5. Large firms borrowing money at lower interest rates and attracting investors easily is an example of: Marketing economies Financial economies Research and development economies Transport and storage economies None 6. A large firm diversifying its production into different goods to cover losses in one product with profits from another is an example of: Managerial economies Technical economies Risk bearing economies Labour economies None 7. Which of the following is an example of internal diseconomy? Rise in input prices due to industry expansion Pressure on infrastructure due to concentration of firms Difficulty in coordination and control due to large scale operations Exhaustion of natural resources None 8. External economies are advantages enjoyed by: All firms in the industry when the industry as a whole expands One firm only when it expands The government when the industry expands Consumers when prices fall None 9. Several firms locating at one place and benefiting from common roads, power, banking and communication is an example of: Economies of disintegration Economies of localisation Economies of information services Economies of producers organisation None 10. Production being split into different parts with each firm specialising in one part is an example of: Economies of localisation Economies of producers organisation Economies of information services Economies of disintegration None 11. When industry expansion leads to rise in wages, raw material prices and interest rates, it is called: Internal diseconomy External diseconomy of rising input prices Economies of localisation Risk bearing diseconomy None 12. The U shape of the LAC curve is caused by: Internal economies causing LAC to fall and internal diseconomies causing LAC to rise External economies only Marginal cost cutting average cost at its minimum Fixed costs in the short run None 13. Which of the following is NOT a type of internal economy? Labour economies Financial economies Economies of localisation Risk bearing economies None 14. Collective research by all firms in an industry on new products and technologies, with the benefits shared by all, is an example of: Economies of disintegration Economies of localisation Economies of information services Economies of producers organisation None 15. When a firm over-expands and top management finds it difficult to coordinate and control operations, this is called: Financial diseconomy Marketing diseconomy Management diseconomy Technical diseconomy None Time's upRelated Posts:CMA Foundation MCQ Quiz Economics Lesson 1.3 - Part 1CMA Foundation MCQ Quiz Economics Lesson 1.3 – Part 2CMA Foundation MCQ Quiz Economics Lesson 1.3 – Part 3CMA Foundation MCQ Quiz Economics Lesson 1.3 – Part 4
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