3 marks Questions
- Distinguish between increase in demand and increase in quantity demanded
- Explain the law of diminishing utility with the help of a schedule
- Good x and good y are substitutes. Explain the effect of fall in price of good y on the demand for good x.
- Explain the implication of free entry and exit of firms under Perfect Competition.
- Given below is the cost schedule of a firm. Its average fixed cost of production is Rs20 when it produces 3 units.
Q
|
1
|
2
|
3
|
AVC
|
30
|
28
|
32
|
- Calculate its marginal cost and average cost at all level of output.
- Explain the effect of following on the demand of a good.
(1) Number of substitute
(2) Nature of the commodity.
- Explain any two causes of increase in demand of a commodity.
- Explain the inverse relationship between price and quantity demanded of a commodity.
- Given below is the cost schedule of a firm. Its average fixed cost of production is Rs 30 when it produces 2 units.
Q
|
1
|
2
|
3
|
AVC
|
80
|
48
|
40
|
- Why the number of firms is small in oligopoly.
- Explain the problem of how to produce.
- Explain the central problem of choice of technique.
- Price elasticity of demand of a good is (-) 1.At a given price the consumer buys 60 units of the good. how many units will the consumer buy if the price false by 10 percent
- Given the market price of a good how a consumer does decides as to how many units of that good to buy? Explain
- What is likely effect on the supply of a good if the prices of the inputs used in the production of that good fall? explain
- Explain what happen to profits in the long run if the firms are free to enter the industry.
- Explain what happen to losses in the long run if the firms are free to leave the industry.
- State the law of demand and show it with the help of a schedule.
- Explain the geometric method of measuring price elasticity of demand
- Why do problems related to allocation of resources in an economy arise? Explain?
- Explain the problem of for whom to produce.
- Complete the following table.
Q
|
TR
|
MR
|
AR
|
1
|
--
|
--
|
8
|
2
|
--
|
4
|
--
|
3
|
12
|
--
|
4
|
4
|
8
|
--
|
2
|
- Explain the effect of fall in prices of the other goods on the supply of a given good.
- State three changes leading to the shift of demand curve of a consumer to the right?
- What will be the price elasticity of supply curve is a positively sloped straight line?
- Explain why a production possibility curve is concave.
- OR
- Explain the central pro0blem ‘for whom to produce’
- With help of the table given below find producer’s equilibrium. Give reason for your answer.
- Output (units)
Output
(units)
|
TR (Rs.)
|
AC(Rs.)
|
1
|
20
|
20
|
2
|
40
|
15
|
3
|
60
|
12
|
4
|
80
|
10
|
5
|
100
|
12
|
6
|
120
|
15
|
32.
Define
marginal revenue. State the relation between marginal revenue and average
revenue when a firm:
I.
Is
able to sell more quantity of output at the same price.
II.
Is
able to sell more quantity of output only by lowering the price.
- From the following table calculate price elasticity of demand by the percentage method.
Price of x (per unit)
|
Total Expenditure
|
4
|
600
|
5
|
525
|
- State any two features each of monopoly and monopolistic competition.
- State four feature of perfectly competitive market.
- Explain the effect of a fall in price of the other good on a commodities equilibrium price and equilibrium quantity. Use diagram.
37. What is meant by consumer’s equilibrium? State its
condition in case of a single commodity.
38. State the
‘total expenditure method’ of measuring price elasticity of demand.
39.
What is meant by returns to a factor? State
the law of diminishing returns to a factor.
40. State any three
causes of a rightward shift of supply curve.
41. Define marginal utility. State the law of diminishing
marginal utility.
42. State any three
factors that affect the price elasticity of demand of a commodity
43. What is meant by returns to scale? State the reasons
for increasing returns to scale.
44. State any three
causes of a leftward shift of supply curve.
45. Draw and define production possibility curve. Why is
it downward sloping from left to right?
46. Explain the problem of ‘what to produce’.
47. Define utility. Explain briefly the law of diminishing
marginal utility.
48. State clearly
any three features of a perfectly competitive market.
49. Explain ‘differentiated products’ characteristic of
monopolistic competition.
50. What is meant by returns to scale? Give one reason for
increasing returns to scale.
51. State clearly the three features of monopolistic
competition.
52. Draw Average Revenue and Marginal Revenue curves of a
firm under
- Perfect competition and monopoly.
54. Distinguish between perfect competition and monopoly.
55. How is price determined under perfect competition?
Explain briefly.
56. Explain the effect of increase in income of the
consumer on the demand for a good.
57. State three causes of increase in supply.
58. Explain the relation between marginal cost and average
cost.
59. Explain producer’s equilibrium with the help of a
diagram.
60. Explain the meaning and conditions of producer’s
equilibrium
- Explain the effect of rise in the prices of related goods on the demand of a good.
- State three causes of decrease in supply.
- Explain the relation between marginal revenue and total revenue.
- Draw straight line supply curves with price elasticity of supply equal to (i) one, (ii) less than one and (iii) more than one.
- Distinguish between fixed cost and variable cost and give one example of each.
66. Give meaning of (i) demand, (ii) normal good and (iii)
inferior good.
67. Explain the effect of ‘input price changes’ on the
supply of a good.
68. Explain the relation between marginal revenue and
average revenue.
69. Draw Average Total Cost, Average Variable Cost and
Marginal Cost curves in a single diagram.
- When is supply of a commodity said to be (i) elastic, (ii) inelastic and (iii) perfectly inelastic?
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