Economics Model Question

Group A

Attempt any TWO.     [2x10=20]

1. Define elasticity of demand. Discuss the relationship between total expenditure and price elasticity of demand. 

2. What is indifference curve? How can a consumer will attain an equilibrium under indifference curve approach? 

3. Distinguish between GDP and GNP. Describe various problems of measuring national income in developing countries like Nepal.

Group B

Attempt any EIGHT.         [8x5=40]

4. Describe briefly society’s production possibility curve. 

5. Suppose a demand schedule is given as below:

    a. Workout with elasticity for fall in price from Rs. 80 to Rs. 60.

    b. Calculate elasticity for the increase in price from Rs. 60 to Rs. 80.

    c. Why is the elasticity coefficient in part a) different from that in b)?

6. The cost and output of a firm is as below:

From this information find out

    i. AFC of producing 3 units

    ii. AVC of producing 4 units

    iii. Least AC level of output

    iv. MC of producing 5 units and

    v. TVC of producing 6 units 

7. Demand and cost function faced by a firm is given as

        P = 12 – 0.4 Q

        C= 5 + 4Q + 0.6Q²

    Find the equilibrium price, quantity, total revenue, total cost and total profit which maximizes profit of the firm.

8.Discuss the government intervention in the market through price floor, price ceiling and tax and effect.

9. Describe the tools of monetary policy.

10 What are the properties of Iso-quant?

11. Explain centralized cartel.

12. Find the gross domestic product at market prices from following data.