Producer Behaviour and Supply [CBSE (Central Board of Secondary Education) Class-12 Economics]: Questions 76 - 82 of 174
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Question 76
Question 77
Describe in Detail Subjective▾
Distinguish between fixed cost and variable cost and give one example of each?
EditExplanation
Characteristics | Fixed cost | Variable cost |
Definition | Fixed costs are costs that do not vary with the level of production. | Variable costs are the costs that do vary with the level of production. |
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Question 78
Describe in Detail Subjective▾
Categorize the following government receipts into revenue receipts and capital receipts. Give reason for your answer.
(a) Receipts from sale of shares of a public sector undertaking.
(b) Borrowings from public.
(c) Profits of public sector undertakings.
(d) Income tax received by government.
EditExplanation
(a) Receipts from sale of shares of a public sector undertaking is capital receipt because it outcomes in reduction of assets of government.
(b) Borrowings from public it is capital receipt and it creates liability for government.
(c) Profits of public sector undertakings it is not capital receipt but it is revenue receipt because it neither creates …
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Question 79
Explanation
Marginal utility | Total utility |
Marginal utility is the satisfaction that we get from consuming another quantity of a good or service. | Total utility is the total satisfaction that we get from consuming a given total quantity of a good or service. |
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Question 80
Question 81
Describe in Detail Subjective▾
On the basis of the information given below, determine the level of output at which the producer will be in equilibrium. Use the marginal cost – marginal revenue approach. Give reasons for your answer
Output (units) | Average Revenue (₹) | Total Cost (₹) |
1 | 7 | 8 |
2 | 7 | 15 |
3 | 7 | 21 |
4 | 7 | 26 |
5 | 7 | 33 |
6 | 7 | 41 |
Explanation
Output (units) | Average Revenue (₹) | Total Cost (₹) | Marginal cost | Marginal revenue |
1 | 7 | 8 | - | 7 |
2 | 7 | 15 | 7 | 7 |
3 | 7 | 21 | 6 | 7 |
4 | 7 | 26 | 5 | 7 |
5 | 7 | 33 | 7 | 7 |
6 | 7 | 41 | 8 | 7 |
Marginal cost = Tc2-Tc1 It means 15 - 8 = 7
The producer reaches equilibrium at 5 units of output because this levels of output both the conditions of producer՚s equilibrium:-
(i) Marginal cost and…
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Question 82
Describe in Detail Subjective▾
Distinguish between ‘fiscal deficit’ and ‘revenue deficit’ . What does fiscal deficit indicate?
EditExplanation
Characteristics | Fiscal deficit | Revenue deficit |
Meaning | Fiscal deficit is defined as excess of total expenditure over total receipts excluding borrowing. | Revenue deficit refers to the excess of revenue expenditure of the government over its revenue receipts. |
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