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7251.

With rise in price of inputs, equilibrium price of the commodity will increase.

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Solution :Equilibrium PRICE will INCREASE as SUPPLY will decrease due to rise in cost of PRODUCTION.
Discussion
7252.

A consumer consumes only two goods X and Y whose prices are Rs 3 and Rs 4 per unit respectively. If the consumer chooses a combination of the two goods with marginal utility of X equal to 4 and that of Y equal to 3, is the consumer in equilibrium, then the consumer will :

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BUY more units of both, X and Y
Buy more units of Y and LESS of X
Buy more units of X and less of Y
Buy less units of both, X and y

Answer :C
Discussion
7253.

Explain the central problem 'for whom to produce'.

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SOLUTION :For whom' means who will buy the goods and SERVICES produced. Clearly, only those who have PURCHASING power or INCOME will be able to buy. As such the problem AMOUNTS to that how should the national income to distributed among people in the economy.
Discussion
7254.

Which of the following refer to geometric form of data presentation ?

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BAR DIAGRAMS
Histogram
PIE diagrams
Both (a) and ( c)

Solution :D
Discussion
7255.

Price Elasticity fo Demand is same for the two commoditites x and y if slope of their demand curves are same.

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Solution :when slope of demand cuves of commodities x and y are same , then PRICE elasticity of demand on their initial price and intial quantity . It happens because.
Elasticity of Demand `(E_(d))= 1/("Slope of demand CURVE")xxP/Q`
Discussion
7256.

State whether True or False. With increase in level of output, AFC goes on falling till it reaches zero

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SOLUTION :FALSE
Discussion
7257.

Why does an economic problem arise? Explain.

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SOLUTION :The central problems of an economy arises DUE to THREE reasons:a) The wants of the people are unlimited.b) The resources to satisfy these wants are LIMITED.c) These limited resources have alternative uses.
Discussion
7258.

How is a frequency polygon different from a frequency curve? Draw the two diagram taking an imaginary set of data.

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Discussion
7259.

Give the meaning of equilibrium market price of a good.

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Solution :EQUILIBRIUM price REFERS to the price at which the quantity demanded of a COMMODITY is equal to the quantity supplied.
Discussion
7260.

Explain the impication of non-price competition in an oligopoly market.

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Discussion
7261.

What is the price elasticity of supply of a commodity whose straight line supply curve passes through the origin forming an angle of 75^(@)?

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Solution :UNITARY ELASTIC `(E_(s)= 1)`because it is passing through the origin , no matter what ANGLE it MAKES.
Discussion
7262.

Law of Demand indicates the direction and amount of change in demand of a commodity due to change in its price.

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Solution :Law of DEMAND only INDICATES the DIRECTION of change in demand and not the AMOUNT or magnitude of change.
Discussion
7263.

State with reasons , whether the following items will have elastic or inelastic demand: (i) Matchbox,(ii) coke , (iii) medicines, (iv) NCERTTextbook, (v) Electricity, (vi) Cigarettes,(vii) Butter for a poor person .

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SOLUTION :(i) Matchbox has inelastic demand as CONSUMER has to spend a very small PROPORTION of his income.
(ii) Coke has elastic demand as it has number of substitutes.
(iii) Medicines have inelastic demand as their consumption cannot be postponed.
(iv) NCERT Textbook has inelastic demand as it is a necessity item.
(v) Electricity has elastic demand a it can be put to several uses.
(vi) CIGARETTES have inelatic deamnd as its consumers are HABITUATED.
(vii) Butter for a poor person has elastic demand as it is a luxury item for the poor person.
Discussion
7264.

Which is not a method to find arithmetic mean?

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DIRECT method
Short-cut method
Step-deviation method
Karl PEARSON's method

Answer :D
Discussion
7265.

An index number which accounts for the relative importance of the items in known as: (i)weighted index(ii) simple aggregative index(iii)simple average of relatives

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ANSWER :(i)
Discussion
7266.

Distinguish between fixed costs and variablecosts. Give two examples of each.

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SOLUTION :Fixed Cost is definite; it will incur EVEN when there is no UNITS are produced.On the other hand, variable cost remains constant in per unit. Examples of fixed cost are RENT, tax, etc. Examples of variable cost are packing expenses, material CONSUMED, etc.
Discussion
7267.

Explain the outcome of the following features of a perfectly competitive market (i) Freedom to the firm to enter the industry, (ii) Freedom to the firm to leave the industry.

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Solution : a)Implication of ' freedom of entry' : 'Freedom of entry' signifies that there are no barriers to the entry of new firms into industry. When the existing firms are earning abnormal profits, the new firms, attracted by the prospects of profit, enter the industry. This RAISES MARKET supply, which in turn, leads to fall in market price and CONSEQUENTLY profits. Te entry continues till each FIRM is earning just the normal profits. b) 'Freedom to exit' signifies that there are no barriers which restrict the existing firms from leaving the industry. The firms try to leave when they are facing losses. As the firms start leaving, market supply falls, leading to rise in market price and consequently reduction in losses. The firms continue to leave till the losses are WIPED out and each existing firm is earning just the normal profits.
Discussion
7268.

Explain the feature 'large number of buyers and sellers' of a perfectly competitive market.

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Solution :There are a large NUMBER of buyers and sellers selling homogeneous product. Neither of them can affect the market price which is determined by the industry. If a FIRM tries to charge a little higher price than the market price, the buyers will buy the goods from other sellers and his sales will FALL. Withfrawal by some buyers or sellers from the market will not affect the market price because the number of buyers ans sellers is large. The firm in this market is only a price taker. It MAY sell any AMOUNT of putput at the existing proce. Thus the demand curve i.e., AR curve of a firm is perfectly elastic and parallel to the X-axis.
Discussion
7269.

A fall in price of wheat will shift the supply curve of rice towards left.

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Solution :False. WHEAT and RICE are substitutes , so the SUPPLY curve of rice will SHIFT towards RIGHT as rice will become more profitable after fall in the price of wheat.
Discussion
7270.

There will be a _______ in the demand curve of cars with an increase in the price of petrol :

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RIGHTWARD shift
Upward Movement
Leftward shift
Downward Movement

Answer :C
Discussion
7271.

Table is the consequence of:

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CLASSIFICATION
organisation
presentation
tabulation

Solution :D
Discussion
7272.

What does a rightward shift indicate?

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SOLUTION :It INDICATES INCREASE in DEMAND of the COMMODITY.
Discussion
7273.

Will a profit maximising firm in a competitive market ever produce a positive level of output in the range where MC is falling ? Explain.

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SOLUTION :No, because the necessary condition of equilibrium is that MC GT MR after equilibrium.
Discussion
7274.

Give the formula for finding out median of a continuous series.

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Solution :MEDIAN class isiedentified .It corresponds to that cumulative frequency which includes the `((N)/(2))` th item . Thefollowing FORMULA is then applied to determine the actual median value.
`M=l_(1)+(N/(2)-c.f.)/(f)xxi`
Here , `l_(1)` = Lower limit of the MEDIANCLASS , = Cumulative frequency of the class PRECEDING the median class , f = Frequency of the median class , i = Size of the median class interval.
Discussion
7275.

Suppose there are 10 students in your class. You want to select three out of them. How many samples are possible ?

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Answer :Selecting 3 STUDENTS out of 10 is given by `.^(10)C_(3)=120`
`:.` 120 SAMPLES are possible.
Discussion
7276.

Microeconomics studies economic activity of an individual unit. (True/False)

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SOLUTION :TRUE
Discussion
7277.

Why is Average Revenue always equal to price.

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SOLUTION :AVERAGE REVENUE(AR) = TOTAL Revenue(TR) / Quantity(Q).
Total Revenue = Price(P) x Quantity(Q).
AR = (P x Q) / Q = P
Discussion
7278.

Define market for a good.

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Discussion
7279.

Give the meaning of opportunity cost.

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Solution :Opportunity COST is the cost of the NEXT BEST ALTERNATIVE foregone.
Discussion
7280.

If Marginal Rate of Substituation is constant throughtout, the Indifference curve will be: (Choose the correct alternative)

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PARALLEL to the x-axis
Downward SLOPING concave
Downward sloping convex
Downward slopeing STRAIGHT line

Answer :D
Discussion
7281.

Using diagram, show that at a given price, demand for oil is rising. Oil being a nonrenewabl source, is becoming a scarce good. What measures can be undertaken to meet the growing demand for oil? Why is it impotant to maintain equality between its demand and supply?

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Solution :Demand for oil rising at a GIVEN price is alarming for the nation as to achieve the objective of sustainable development, we need to maintain it for the needs of future GENERATIONS too. We should make people aware of SHORTAGE of oil and ENCOURAGE them to USE public transport system, car pools etc. There should be optimum use of scarce oil.
Discussion
7282.

According to Law of Variable Proportions, there are _______ phases.

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1
3
2
4

Answer :B
Discussion
7283.

The following table depicts the production possibilities of commondiaties X and Y: (a) Show these production possibilities through PPF. What do the points on the curve indicate? (b) Lable a point F inside the curve. What does this point indicate? (c ) Lable a point G outside the curve. What does this point indicate? (d) What must occur so that economy can attain the level of production as indicated by point G.

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Solution :(a)The GIVEN DIAGRAM shows all the PRODUCTION possibilities given in the table. Point on the curve (A to E) indicate that there is fuller utilization of resources,
(b) Point F inside the curve indicates under utilization of resources,
(c ) Point G outside to curve indicates an unattainable combination,
(d) Economy can attain the level of production as indicated by point G, only when there is an INCREASE in resources or an improvement in technology with respect to both COMMODITIES X and Y.
Discussion
7284.

Which average would be suitable in the following cases? (i) Average size of readymede garments. (ii) Average intelligence of students in a class. (iii) Average wages in an industrial concern. (iv) Average wages in an industrial concern. (v) When quantities of the variable are in ratios. (vi) When quantities of the variable are in ratios. (vii) In case of open-ended frequency distribution.

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Answer :(i) Mode (INDICATING a typical of the series).
(ii) Mode (identifying modal value by ranking intelligence on the scale of 1-10).
(III) Arithmetic mean.
(iv) MEDIAN (indicating 'less than or equal to wage'for 50% of the workers, and 'more than or equal to wage' for the other 50%).
(V) Arithmetic mean.
(vi) Weighted arithmetic mean.
(vii) Median (as it is not sensitive to all the values in a series).
Discussion
7285.

An individuals firm under perfect coimpetition cannot influence the market price, then who can and how?

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Solution :Under PERFECT COMPETITION the industry can influence market PRICE by RAISING or lowering output.
Discussion
7286.

Explain the meaning of diminishing MRS with the help of a numerical example

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Discussion
7287.

…..............Are also called reference table. (General purpose tables/Species purpose table)

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SOLUTION :GENERAL PURPOSE table
Discussion
7288.

A person's total utility (TU) schedule is given below. Derive marginal utility (MU) {:("Units",0,1,2,3,4,5,),(TU,0,10,25,38,48,55,):}

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SOLUTION :
Discussion
7289.

What do you mean by variable factors ?

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SOLUTION :Variable factors are the factors which VARY with the level of OUTPUT.
Discussion
7290.

A consumer consume only two goods X and Y. Let P_(x) and P_(y) be their prices and Q_(x) and Q_(y) the quantities of these goods respectively. Let m be income. The budget contraints equations is

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`P_(x).Q_(x)+P_(y).Q_(y)=m`
`P_(x).Q_(x)+P_(y).Q_(y) LT m`
`P_(x).Q_(x)+P_(y).Q_(y) gt m`
None of the above

ANSWER :B
Discussion
7291.

Suppose there are four bundles containing goods x and goods y, bundle (5,5), Bundle (4,4), Bundle (5,4), Bundle (4,5). If a consumer's perferences are monotonic, then which bundle will be preferred by the consumer ? Give reason for your answer.

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Solution :CONSUMER will prefer the BUNDLE (5,5) as COMPARED to all the three bundles if he has monotonic preferences.
`**` The consumer will prefer the bundle `(5,5)` as compared to bundle (4,4) because the FORMER has more of both GOODS.
`**` Similarly, he will prefer the bundle (5, 5) as compared to bundle (5,4)because the former has same amount of good x, but more of good y.
`**` Similarly, he will prefer the bundle (5,5) as compared to bundle (4,5) because the former has same amount of good y, but more of good x.
So, the consumer will prefer the bundle (5,5)
Discussion
7292.

Discuss short run equilibrium in diagram.

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Solution :Short RUN EQUILIBRIUM Situations are given as FOLLOWS :
Discussion
7293.

Price elasticity of supply of a good is 5 . A producer sells units 500 units of this good at Rs.5 per unit . How much will be willing to sell at Rs. 6 per unit ?

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<P>

Solution :`E_(s)=(P)/(Q)xx(DELTAQ)/(DeltaP)`
`5=(5)/(500)xx(DeltaQ)/(1)`
`DeltaQ=500`
New `Q=Q+DeltaQ=500+500=1000` units
Discussion
7294.

What happens to the budget set and budget line if both the prices as well as the income double ?

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Solution :If as given,
`P_1`CHANGES from Rs.8 to Rs.16
`P_2` changes from Rs.10 to Rs.20
and M changes from Rs.40 to Rs.80 then intercepts on X-axis and Y-axis will remain unchanged at 5 units and 4 units RESPECTIVELY and the slope of the price LINE will remain UNAFFECTED. i.e., `8/10=16/20`, therefore there will beno change in the budget set and budget line.
Discussion
7295.

Explain the significance of " minus sign" attched to the measure of priced elasticity of demand in case of a normal good as compared to the " plus sign" attached to the measure of price elasticity of supply.

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Solution :The minus SIGN just REPRESENTS the negative relationship between price and QUANTITY demanded of a COMMODITY.
Discussion
7296.

Both total cost and total fixed cost curve start from the same point.

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Solution :True. Both the curves START form the Y-axis as both are same at ZERO level of output.Total cost INCLUDES Total fixed cost and Total variable cost and TVC is zero at Zero level of output, so TC=TFCat zero level of output.
Discussion
7297.

Firms undr monopolistic competition spend huge amount on advertisement. It is left desirable by the firms to make people aware of the new products available end also to create brand image in the mind of consumers. Is it justified ?

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Solution :It is not always justified. As far as selling COSTS aer incurred to give information or create AWARENESS or to persuade consumers of distinctivencess of the product, it is desirable. If it turns defensive and firms start incurring huge amount of money increasing their total cost then it is not desirable because this high cost is passed on to CONSUMER in the from of high prices.
Discussion
7298.

Which of these is not a property of indifference curve ?

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Indifference CURVE slopes downards
Indifference curve is concave downwards
Two indifference curves cannot intersect each other
HIGHER indifference curve REPRESENTS higher LEVEL of satisfaction

Answer :B
Discussion
7299.

Explain the concepts of the short run and the long run.

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Solution :In the long run, FIRMS are able to adjust all costs, whereas, in the short run, firms are only able to INFLUENCE PRICES through adjustments made to production levels. In ECONOMICS, long-run models may shift away from short-run equilibrium, in which SUPPLY and demand react to price levels with more flexibility.
Discussion
7300.

Define a variable.

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SOLUTION :A characteristic or a PHENOMENON which is CAPABLE of being measured and changes its value OVERTIME is called a VARIABLE.
Discussion