- Question 1
Which of the following measures of price elasticity shows elastic supply?
(Choose the correct alternative)
(a) 0
(b) 0.5
(c) 1.0
(d) 1.5 VIEW SOLUTION
- Question 2
Define opportunity cost. VIEW SOLUTION
- Question 3
At what level of production is total cost equal to total fixed cost? VIEW SOLUTION
- Question 4
Which of the following does not cause shift of supply curve of a good?
(Choose the correct alternative)
(a) Price of input
(b) Price of the good
(c) Goods and services tax
(d) Subsidy VIEW SOLUTION
- Question 5
A consumer buys 200 units of a good at a price of Rs 20 per unit. Price elasticity of deamnd is (–) 2. At what price will he be willing to purchase 300 units? Calculate. VIEW SOLUTION
- Question 6
Explain the central problem of "What is produced and in what quantities.".
OR
In what circumstances may the production possibility frontier shift away from the origin? Explain. VIEW SOLUTION
- Question 7
Explain the implications of "freedom of entry and exit of firms" under perfect competition. VIEW SOLUTION
- Question 8
Write a budget line equation of a consumer if the two goods purchased by the consumer, Good X and Good Y are priced at Rs 10 and Rs 5 respectively and the consumer's income is Rs 100.
OR
Define marginal rate of substitution. Explain its behaviour along an indifference curve. VIEW SOLUTION
- Question 9
Explain the conditions of producer's equilibrium under perfect competition. VIEW SOLUTION
- Question 10
Draw Average Variable Cost (AVC), Average Total Cost (ATC) and Marginal Cost (MC) curves in a single diagram. State the relation between MC curve and AVC and ATC curves. VIEW SOLUTION
- Question 11
Define price floor. Explain the implications of price floor.
ORMarket of a good is in equilibrium. If the demand for the good 'decreases'. Explain the chain of effects of this change. VIEW SOLUTION
- Question 12
A consumer consumes only two goods X and Y. Explain the conditions of consumer's equilibrium using Utility Analysis. VIEW SOLUTION