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Uttar Pradesh
India 201303
ASSIGNMENTS
PROGRAM: DBM
Subject Name
Study COUNTRY
Roll Number (Reg.No.)
Student Name
:
:
:
:
INSTRUCTIONS
a) Students are required to submit all three assignment sets.
ASSIGNMENT
Assignment A
Assignment B
Assignment C
DETAILS
Five Subjective Questions
Three Subjective Questions + Case Study
Objective or one line Questions
MARKS
10
10
10
b)
c)
d)
e)
Signature :
Date
:
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MANAGERIAL ECONOMICS
Section A
All questions carry equal marks.
Section B
Q.1 Explain the concepts of return to scale and returns to a factor.
Q.3 Explain the relationship among the average total cost marginal cost and average variable costs.
Case Study
DEMAND FORECASTING FOR CABLES
The market research department of M/s. Bengal Cable Company, Calcutta was entrusted with
forecasting the demand for cables of the company. It was felt that the demand for cables is
considerably influenced by the pace of industrialization, power development transmission and
industrial and house wiring. Bengal Cable Company is exclusively engaged in the manufacture of
required by industry and housing.
While many factors such as the rate of building activity purchasing power, etc. are important in
determining the demand for cables, it was felt that most of the demand for cables can be explained
in terms of the growth of power consumption in the country.
Since for industry and buildings, cables are a must, the price factor was not considered as significant
variable in determining the demand for cables. After all this product has no substitute.
The market research department of M/s Bengal Cable Company, Calcutta, developed a model
relating all India cable sales (Industrial and housing cables) to the peak demand for power in the
country. The analysis based on time series data has shown a strong positive correlation between all
India cable sales and the peak demand for the corresponding year.
The estimating equation is as follows :Yt = 1173 + 28.5 Xt
Where
Yt = annual cable sales 9in thousand coils) for all India in year t
Assignment C
(Objective type Questions)
Q. 2 In choosing between beef 7 shirts, consumers increase their purchases of each until a. the
marginal utility from the last rupee spent on one is the same as on the other
b. the marginal utility from the last pound of beef is the same as from the last shirt
c. the total utility from one is the same as from the other
d. none of the above.
Q.3 Which of the following is a fixed cost?
a. cost of machinery
b. wages
c. cost of plant
d. a and d
Q. 7 A purely competitive firm is in short run equilibrium and its MC exceeds its A3.
It can be included that
Q.10 If an imperfectly competitive firm is selling its 100th unit of output for $35, its
marginal revenue
a. does not have to worry about how its rivals will react to its price
b. knows how its rivals will react to its price
c. is uncertain about its rivals reaction
d. none of the above
a. product differentiation
b. price leadership
c. market power
d. free entry
Q.19 A purely competitive firm will be willing to produce at a loss in the short run
provided.
a. the loss is no greater than its variable costs
b. the loss is no greater than its marginal costs
c. the loss is no greater than its fixed costs
d. price exceeds ma rginal costs
Q. 21 A pure monopolist
d. will never produce in the output range where marginal revenue is positive.
Q.28 The monopolistically competitive sellers demand curve will tend to become more
elastic, the
a. smaller the number of competitors
b. larger the number of competitors
c. greater the degree of product differentiation
d. more significant the barriers to entering the industry
Q.29 The monopolistically competitive seller maximizes profits by producing at the point
where
a. marginal revenue equals average cost
b. price equals marginal revenue
Q.31 The larger the number of firms and the smaller the degree of product differentiation,
the
a. More elastic is the monopolistically competitive firms demand curve.
b. Less elastic is the monopolistically competitive firms demand curve.
c. Larger will be the monopolistically competitive firms fixed costs.
d. Greater the divergence between the demand and the marginal revenue curves
of the monopolistically competitive firm.
Q.32 If the number of firms in a monopolistically competitive industry increases and the
degree of product differentiation diminishes.
a. the likelihood of collusive pricing would increase.
Q.34 One would expect that collusion among oligopolistic producers would be easiest to
achieve in which of the following cases?
a. a very few forms producing a homogeneous product.
b. a rather number of firms producing a homogeneous product.
c. a very few firms producing a differentiated product.
d. a rather large number of firms producing a differentiated product.
Q.35 Under which of the following market structures will equilibrium price be equal to
marginal cost?
a. pure competition
b. pure monopoly
c. monopolistic competition
d. oligopoly
Q. 39 In defining costs
a. economists take implicit opportunity costs into account, but a ccountants do not
b. accountants take implicit opportunity costs into account, but economists do not
c. both take implicit opportunity costs into account
d. neither take implicit opportunity costs into account.