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5651.

The price elasticity of supply of a commodity is 2. When its price falls from Rs. 10 to Rs. 8 per unit, its quantity supplied falls by 500 units . Calculate the quantity suppliedat the reduced price.

Answer»

SOLUTION :`E_(s)=(P)/(Q)xx(DeltaQ)/(DeltaP),2=(10)/(Q)xx(-500)/(-2),4Q=5000,Q=1250`
Supply at `RS 8=Q+ DeltaQ=1250 +(-500)=750` units.
Discussion
5652.

There is shortage of basic essentials like pulses, oil etc. What will be its impact on prices ? What should be done by the governemnt to check this?

Answer»

Solution :Shortage of basic essential like pulses, oil etc will lead to fall in their supply causing rise in the prices since demand of essentials is inelastic, increase in their prices WOULD be a problem for the common man. HENCE,
Government should interfere to check HOARDING and black marketing.
Goverment should strengthen its public DISTRIBUTION system.
Government may renew the eligibility conditions of acquiring these goods through fair PRICE shops.
Discussion
5653.

Discuss the central problems of an economy.

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Solution :1. What to Produce:This problem involves selection of goods and services to be produced and the quantity to be produced of each selected commodity. Every economy has limited resources and thus, cannot produce all the goods. More of one good or service USUALLY means less of others.2. How to Produce:This problem refers to selection of technique to be used for production of goods and services. A good can be produced using different techniques of production. By ‘technique’, we mean which particular combination of inputs to be used. Generally, techniques are classified as: Labour intensive techniques (LIT) and Capital intensive techniques (CIT).i. In Labour intensive technique, more labour and less capital (in the form of machines, etc.) is used.ii. In Capital intensive technique, there is more capital and less labour utilization.3. For Whom to Produce:This problem refers to selection of the category of people who will ultimately consume the goods, i.e. whether to produce goods for more poor and less rich or more rich and less poor. Since resources are scarce in every economy, no society can satisfy all the wants of its people. Thus, a problem of choice arises.Goods are produced for those people who have the PAYING capacity. The capacity of people to pay for goods depends upon their level of income. It means, this problem is concerned with DISTRIBUTION of income among the factors of production (land, labour, capital and enterprise), who contribute in the production process.
Discussion
5654.

A Histogram is a graphical presentation of a frequency distribution of a:

Answer»

INDIVIDUAL SERIES
DISCRETE series
continuous series
none of these

Solution :C
Discussion
5655.

Due to increase or decrease in income of a consumer, there is a parallel rightward or leftward shift in the Budget line, given that there is no change in prices of good 1 and good 2.

Answer»


ANSWER :A::C::D
Discussion
5656.

Is it possible to postpone the law of variable proportion ?

Answer»


Answer :The law of VARIABLE proportion can be postponed by
(i)IMPROVEMENT in Technology
(II) Developing some SUBSTITUTES of fixed FACTOR, but ultimately the law operates
Discussion
5657.

What happens to the difference between ATC and AVC as production in increased?

Answer»

Solution :The difference between ATC and AVC is AFC. However, as AFC declines with the increase in the OUTPUT LEVEL, the difference between ATC and AVC becomes SMALLER and smaller. An important point to note here is that although AFC keeps declining with increasing output level, but it can never become zero.
Discussion
5658.

Define cost of production

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SOLUTION :It refers to the expediture incurred on INPUTS USED in the PRODUCTION PROCESS.
Discussion
5659.

The following table shows monthly pocket expenses of the students of a class. Find out average pocket expenses. {:("Pocket Expenses(Rs.)",20-29,30-39,40-49,50-59,60-69),("Number of Students"," "10," "8," "6," "4," "2):}

Answer»

Solution :CALCULATION of ARITHMETIC mean of inclusive series is the same as of exclusive series.

`barX=A+(sumfd')/(sumf)xxC`
`=44.5+(-20)/30xx10`
`=44.5-20/3`
`=445-6.67=37.83`
Average Pocket EXPENSES = RS. 37.83.
Discussion
5660.

Explain the condition of a firm based on MC and MR.

Answer»

Solution :ACCORDING to this approach, the producer is in equilibrium when the Marginal Revenue (MR) is EQUAL to the Marginal Cost (MC) and Marginal Cost curve cuts the Marginal Revenue curve from below. TWO CONDITIONS under this approach are:(i) MC = MR(ii) MC curve should cut the MR curve from below.
Discussion
5661.

A producer is willing to supply 150 units of good X at a price of Rs. 10 per unit. When price of X rises to Rs. 11, he is willing to supply 200 units.Calculate Es.

Answer»


ANSWER :3.33
Discussion
5662.

In the first quadrant, the values of X and Y are :

Answer»

`+ve`
`-ve`
X is +ve and Y is -ve
none of these

Solution :A
Discussion
5663.

Calculate the marginal opportunity cost (MOC) of commodity A for the given combinations:

Answer»

SOLUTION :
Discussion
5664.

The central problem of 'for whom' refers to distribution of goods between

Answer»

(a) RICH and the POOR
(b) Users
(C) Different sections of society
(d) Between public sector and private sector

Answer :B
Discussion
5665.

Opportunity cost in the:

Answer»

Number of units sacrificed
Number of units gained
Cost of next best alternative foregone
None of these.

Solution :C. A benefit, profit, or VALUE of something that must be given up to acquire or achieve something else. Since every resource (land, money, TIME, etc.) can be PUT to alternative USES, every action, CHOICE, or decision has an associated opportunity cost.
Discussion
5666.

Define partition value.

Answer»

Solution :The VALUE that DIVIDES the series into more than TWO PARTS is called PARTITION Value.
Discussion
5667.

Explain the chain of effects of an increase in supply of a commodity on its equilibrium price.

Answer»

Solution :An INCREASE in supply of a COMMODITY leads to a shift in the supply curve rightwards. When supply increases, it creates an excess supply at the old equilibrium price. This leads to a competiton among sellers, which reduces the price. Decrease in price leads to an increase in demand and fall in supply. These changes continue till a NEW equilibrium is achieved. Eventually, equilibrium price falls and equilibrium quantity RISES.
Discussion
5668.

What should be the starting point of straight line upward sloping supply curve, when (i) E_(S)=1 (ii) E_(S)gt1 (iii) E_(S)lt1 Draw the supply curves showing : (i) E_(S)=1 (ii) E_(S)gt1 (iii) E_(S)lt1

Answer»

SOLUTION :
Discussion
5669.

Explain how price is determined In a perfectly competitive market with fixed number of firms.

Answer»

Solution :MARKET eqilibrium occurs at the point where Quantity DEMANDED = Quantity Supplied. The price at this particular LEVEL of quantity is known as the EQUILIBRIUM Price.
Discussion
5670.

Explain the features of a monopoly market. Why is the demand for a good under monopoly less elastic than under monopolistic competitin ?

Answer»
Discussion
5671.

How much selling costs are incurred in csae of perfect competition?

Answer»

Very high
Very less
Neligible
Zero

Solution :D.
Discussion
5672.

Gemand curve of a firm is perfectly elastic under {:((a)"Perfect competition",(b)"Oligopoly only"),((c)"Monopolistic competitin",(d)"Oligopoly"):}

Answer»


ANSWER :a
Discussion
5673.

A cost savingtechnology shifts the supply curve of a commodity towards left.

Answer»

Solution :FALSE, Cost saving technology will raise the PROFIT margin and will shift the supply curve of the COMMODITY towards right as the SUPPLIERS or the producers would want to increase their production.
Discussion
5674.

Stand deviation is a better measure of dispersion compared to mean deviation as it is based on the squares of deviations from the mean. (true/False)

Answer»


ANSWER :TRUE
Discussion
5675.

Calculate Average Product (AP) and Marginal Product (MP): |{:("Variable Factors",0,1,2,3,4,6),("Total Product (TP)",0,8,20,28,28,25):}|

Answer»

SOLUTION :
Discussion
5676.

Define private cost.

Answer»

Solution :It refers to COST of production incurred by an INDIVIDUAL FIRM for producing a COMMODITY.
Discussion
5677.

An indifference curve to the right shows higher utility because of

Answer»

MONOTONIC PREFERENCES
Cardinal preferences
Ordinal preferences
NONE of the above

ANSWER :A
Discussion
5678.

An _______ series is that series which includes all items upto its upper limit. (inclusive / exclusive)

Answer»


ANSWER :INCLUSIVE
Discussion
5679.

Government of India's Economic survey:

Answer»

Publihses only primary data
PUBLISHES only SECONDARY data
Publishes both primary and secondary data
Does not PUBLISH any data

Solution :B. Publishes only secondary data
Discussion
5680.

Define frequency polygon.

Answer»


SOLUTION :All mid-points INDICATING frequencies of the different classes JOINED to MAKE a graph are called FREQUENCY polygon.
Discussion
5681.

Describe briefly the method of calculating standard deviation in ungrouped data .

Answer»
Discussion
5682.

Total Utility is ______ at the point of satiety:

Answer»

Minimum
Maximum
Zero
None of these

Answer :B
Discussion
5683.

What is the relationship between TP and MP ?

Answer»


ANSWER :(i)When TP Increases at an INCREASING rate, MP increases.
(ii) When TP increases at a diminishing rate, MP falls positively.
(iii) When TP is maximum, MP is ZERO.
(IV) When TP DECREASES, MP is negative.
Discussion
5684.

Suppose consumer taste shifts in favour of apples. As a result, equilibrium quantity will - and equilibrium price will -

Answer»

INCREASE, decrease
Decrease, increase
Increase, increase
Decrease, decrease

Answer :(C)
Discussion
5685.

Firms cooperate with each other in determining price or output or both. It is a feature of

Answer»

PURE Oligopoly
Non-Collusive Oligopoly
Imperfect Oligopoly
Collusive Oligopoly

Solution :N/a
Discussion
5686.

Can Average product be zero or negative ?

Answer»

SOLUTION :Average PRODUCT is ZERO when TOTAL product is zero, but Average product can never be negative as total product cannot be negative.
Discussion
5687.

Which of the following does notcasue shift so supply curves of a good ? (Choose thecorrectalternative )

Answer»

PRICE ofinput
Price of thegood
Goodsand ServiceTax
SUBSIDY

Solution :when price of the good increases, it CAUSES an UPWARD movementalong the same supply curve and vice-versa. it does not shift the supply curve either to the LEFT or right.
Discussion
5688.

Distinguish between Microeconomics and Macroeconomics

Answer»
Discussion
5689.

Economy always operates on production possibility frontier.

Answer»

SOLUTION :ECONOMY operates on PRODUCTON possibillity frontier (PPF) only when resources are fully and efficiently utilised. If resources are not fully and efficiently utilized, then economy operates at any POINT indide PPF.
Discussion
5690.

A farmer inverts his own savingin doing farmings, but hires labour to do work. Identifyimplicit cost.

Answer»

SOLUTION :Imputed interest of own SAVING is implicit COST.
Discussion
5691.

Explain the vaious kinds of price elasticities of supply.

Answer»
Discussion
5692.

Producer's Equilibrium under MR-MC approach is achieved when :

Answer»

MR=MC
`MC gt MR` after the EQUALITY between MR and MC
Either (a) or (B)
Both (a) and (b)

Solution :N/a
Discussion
5693.

The firm's demand curve and industry demand curve is same in case of monopoly marke.

Answer»

Solution :Under monopoly, there is a single seller SELLING the product. So, the monopoly firm and industry are ONE and the same THING and firm's DEMAND curve and industry demand curve is same
Discussion
5694.

Who developed the measure of coefficient of variation ? State the method .

Answer»
Discussion
5695.

Headings should generally be written in the …............. Form. (singular/plural)

Answer»


SOLUTION :SINGULAR
Discussion
5696.

Economic slow down in some parts of the world has adversely affected damand for Indian exports. What will be its effect on the production possibilities frontier of India? Explain.

Answer»

Solution :There will be no effect on Production Possibbility Frontier (PPF) because PPF shows only what a country can POTENTIALLY producr and not what it actually produces. Slow down by REDUCING demand for EXPORTS, may ultimately bring down output. Assuming that the country's ACTUAL production is SOMEWHERE on the PPF, slow down may result in the country producing at a point somewhere below the PPF.
Discussion
5697.

In the third quadrant the values of both X and Y are negative. (True/False)

Answer»


SOLUTION :TRUE
Discussion
5698.

Explain the effects of a 'Price Floor'.

Answer»

Solution :Price floor is the minimum price fixed for a commodity by the GOVERNMENT (above the equilibrium price), which must be PAID to the producers for their produce.
As a result of price floor, the market price is above the equilibrium price, LEADING to EXCESS supply.
Discussion
5699.

The Law of Diminishing Marginal Utility will not hold good if Income of the consumer:

Answer»

Increases
Decreases
Remains constant
Either (a) or (B)

ANSWER :D
Discussion
5700.

Derive the law of demand from the single commodity equilibrium condition "marginal utility-price"

Answer»

Solution :Law of demand can be derived from the CONEPT of consumer EQUILIBRIUM in case of single COMMODITY as follows.we KNOW that at equilibrium,MUX = PriceNow, according to the law of diminishing marginal utility, the marginal utility derived from every additional unit of a GOOD consumed tends to decline at the same price. Consequently, for each additional unit of the good, the consumer is willing to pay a lesser price. Thus, the consumer will increase his demand only when the price falls and vice-versa. .
Discussion