UNIT 3 QUESTION BANK

1. Explain production. What are the factors of production? 2. Explain in brief the features of 4 important factors of production. 3. Draw a graph and explain TFC, TVC and TC. 4. Explain why AFC is downward sloping. 5. Explain why AVC and AC are U shaped. 6. What are short run average cost curves-explain. 7. What is planning curve? Why is it called so? 8. Explain why long run average cost curves are U shaped. 9. Why is long run average cost curve called as an envelope? 10.Bring out the relation between marginal cost and average cost. 11.What is marginal cost? How is it calculated and why? 12.Analyse and explain the following cost:
A. opportunity cost

B. implicit cost C. sunk cost D. incremental cost E. sunk cost F. historic cost G. explicit cost H. alternative cost I. social cost J. private cost K. replacement cost L. maintainance cost M. real money cost

N. economic cost O. accountant cost P. fixed cost Q. variable cost R. total cost S. average cost T. marginal cost U. short run cost V. long run cost W. traceable cost X. non-traceable cost Y. avoidable cost Z. unavoidable cost

13. What is economies of scale? Explain in detail. 14. Bring out importance of indivisibility of factors of production. 15. Relate indivisibility of factors of production and long run average cost curves 16. What is producers equilibrium? Explain with help of graph. 17. What are iso-cost line? Why is it also called as budget line? 18. What are iso-quants? Explain its features. 19. Why should iso-cost be tangent to iso quants at the point of equilibrium? 20. What is break even? Explain with graph.

UNIT 4 QUESTION BANK

1. What is market structure? Explain the classification of markets on

basis of competition. 2. Explain why average revenue is considered to be price and demand curve. 3. Why should marginal revenue be equal to average revenue in a perfectly competitive market? 4. Why should marginal revenue lie below average revenue in imperfect competition? 5. Bring out relation between marginal revenue and avenger revenue. 6. What is perfect competition? Explain its features and price output determination under perfect competition. 7. What are the 2 conditions of equilibrium that is applied in all competitive situations? 8. Explain monopoly? How are prices determined in monopoly? 9. What is price discrimination? How is it helping a monopolist? 10. When is price discrimination possible for a monopolist (under monopoly)? 11. Differentiate between perfect and monopoly competition. 12. What is monopolistic competition? Explain the price output determination under monopolistic competition. 13. Explain what is oligopoly. How are prices determined in a collusive oligopoly model? 14. Explain kinked demand curve model in detail. 15. What is price rigidity? Explain using kinked demand curve model. 16. Explain why in real world monopolistic and oligopoly are experienced more than perfect competition. 17.Bring out the importance of pricing a commodity. 18.Explain in detail the objectives and methods of pricing a commodity. 19.What is product line pricing?