Economics 2080
Section A
Long Answer Questions
Attempt any TWO questions. [2 × 10 = 20]
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1. Define elasticity of supply. What are the various types of elasticity of supply? Explain with diagrams. [10]
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2. Define production function. Discuss the various features of the Cobb-Douglas production function. [10]
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3. What is a perfect competition market? How are price and output determined under it in the short run? [10]
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Section B
Short Answer Questions
Attempt any EIGHT questions. [8 × 5 = 40]
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4. What are the features of a mixed economy? [5]
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5. Explain the concept of scarcity and choice in the decision-making process. [5]
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6. Consider the following demand schedule:
| Combination | A | B | C | D | E |
|---|---|---|---|---|---|
| Income (Rs) | 0 | 2 | 4 | 6 | 8 |
| Demand (Units) | 200 | 160 | 120 | 80 | 40 |
i) Compute the income elasticity of demand at movement from B to C and C to B by the proportional method.
ii) Compute the income elasticity of demand midway between B and C and C and B. [5]
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7. Define price consumption curve (PCC). Derive the price consumption curve for Giffen goods with the help of the indifference curve approach. [5]
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8. Consider the following cost schedule:
| Output | 0 | 1 | 2 | 3 | 4 | 5 | 6 | 7 |
|---|---|---|---|---|---|---|---|---|
| TVC | 0 | 50 | 90 | 120 | 140 | 175 | 230 | 310 |
a) At TFC = 120, compute TC, AFC, AVC, and ATC.
b) Draw the graph of AFC, AVC, and ATC. [5]
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9. Explain the various properties of the indifference curve. [5]
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10. Show the relationship between AR and MR under the monopoly market with the help of a table and figure. [5]
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11. Differentiate between expansionary fiscal policy and contractionary fiscal policy. [5]
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12. From the following data, calculate the national income:
| Particulars | Rs. in million |
|---|---|
| Gross fixed capital formation | 300 |
| Private final consumption expenditure | 900 |
| Net Export | -50 |
| Subsidies | 50 |
| Government final consumption expenditure | 150 |
| Indirect taxes | 250 |
| Change in stock | 50 |
| Consumption of fixed capital | 50 |
| Net factor income from abroad | 50 |
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