IEcoS (Economic Services) Economics Paper-1: Questions 46 - 53 of 85

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Question number: 46

» Theory of Consumer's Demand » Marginal Utility and Demand

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Essay Question▾

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Given the demand function and total cost function of a perfectly competitive firm as , p being price, c being cost and X = Output find out the output, price, profit and total revenue corresponding to maximisation of total profit

Explanation

Profit

Order derivative,

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Question number: 47

» Theory of Consumer's Demand » Slutsky Theorem and Demand Curve, Revealed Preference Theory

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State and explain Kaldor – Hicks Compensation Principle.

Explanation

According to Kaldor if a certain change in economic organisation or policy makes some people better off and others works, off then that change will increase social welfare if those who gain from the change could compensate the losers and still be better off than before.

Prof Hicks supported Kaldor that any criterion that will result in change in

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Question number: 48

» Theory of Consumer's Demand » Marginal Utility and Demand

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What is law of diminishing marginal utility?

Explanation

Image of The Definition of law of diminishing

Image of the Definition of Law of Diminishing

Image of The Definition of law of diminishing

  • Before analysis, the law of diminishing marginal utility we have to understand the term utility and marginal utility. Utility is the want satisfying power of a commodity. Utility measures in the term of ‘until’ that was given by Fisher.

    • Marginal util

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Question number: 49

» Theory of Value » Pricing under Different Market Structures » Public Sector Pricing

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Appeared in Year: 2015

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What is meant by excess capacity? Why is it bad? Are there any benefits of the excess capacity associated with the monopolistic competition?

Explanation

Meaning:

Theories of Chamberlin’s monopolistic competition and Joan Robinson’s imperfect competition have revealed that a firm under monopolistic competition or imperfect competition in long-run equilibrium produces an output, which is less than socially optimum or ideal output.

  • This means that firms operate at the point on the falling portion

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Question number: 50

» Theory of Production » Factors of Production and Production Function

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What is industrial policy? Why it is needed and analyzes the pros and cons of it.

Explanation

Image shows Theory of Industrial policy

Image Shows Theory of Industrial Policy

Image shows Theory of Industrial policy

  • India was endowed with great economy since ancient times but the colonial exploitation has ruined the economy with global industrial output of just and after the independence the struggle start to get the economy indian sed and favorable for the people

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Question number: 51

» Quantitative Methods in Economics » Statistical and Econometric Methods » Testing of Hypothesis, Simple Non-Parametric Tests

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Appeared in Year: 2015

Essay Question▾

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Explain the distinction between the parametric and non-parametric tests.

Explanation

To make the generalization about the population from the sample, statistical tests are used. A statistical test is a formal technique that relies on the probability distribution for reaching the conclusion concerning the reasonableness of the hypothesis. These hypothetical testing related to differences are classified as parametric and non-paramet

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Question number: 52

» Theory of Consumer's Demand » Cardinal Utility Analysis

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How can you measure the price electricity of demand at any point on a straight-line demand curve?

Explanation

  • The price electricity of demand is defined as the degree of responsiveness of quantity demand of a commodity to change in its price. We can measure the price electricity of demand at any point on a straight-line demand curve through POINT METHOD which was developed by prey Marshall.

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Question number: 53

» Theory of Production » Forms of Production Functions

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Appeared in Year: 2015

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Define Linear homogenous production function and give an example. Show that in the case of the linear homogenous production function the expansion path must be a straight line passing through the origin.

Explanation

The Linear Homogeneous Production Function implies that with the proportionate change in all the factors of production, the output also increases in the same proportion.

  • Such as, if the input factors are doubled the output also gets doubled. This is also known as constant returns to a scale.

  • The production function is said to be homogeneo

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