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Monday, January 27, 2020

AHSEC - CLASS 12: ECONOMICS IMPORTANT TOPICS (PART A - MICRO ECONOMICS)


Pattern of Question Paper (Part A)
1 Marks x 6 Questions
2 Marks x 6 Questions
4 Marks x 5 Questions
6 Marks x 2 Questions
6 Marks
12 Marks
20 Marks
12 Marks
Total
50 Marks

ECONOMICS (PART-A) – IMPORTANT QUESTIONS FOR AHSEC CLASS 12
Chapter-1: INTRODUCTION TO MICROECONOMICS – 4 MARKS
A. Very Short Answer Questions: (Marks 1/2)
1.      Define goods and services. Give one example of each.                      2013, 2017
2.      What is opportunity cost? Opportunity cost is also called the _____ cost.           2012, 2014, 2016, 2019
3.      What is a market economy and centrally planned economy? Also distinguish between them. 2014, 2015, 2019
4.      What is a mixed economy?                   2013, 2016
5.      What is scarcity? Does the scarcity of resources that gives rise to the problem of choice?                  2018
6.      Name the economist who is well known as the father of economics.
7.      Give one reason for a rightward shift in PPF (production possibility frontier).      2019
8.      Give two examples of growth of resources.
B. Short Answer Questions II type: (Marks 3/4)

1.      Why the production possibility curve slopes downward from left to right?                      2019
2.      What is positive and normative economics? Distinguish between positive economics and normative economics.          2015, 2018
3.      Explain the central problems of an economy.                         2012, 2014, 2016
4.      What is micro and macro economics? 2017
Chapter-2: THEORY OF CONSUMER BEHAVIOUR – 13 MARKS
A. Very Short Answer Questions: (Marks 1)
1.      Define utility.                   2014
2.      What does the utility of a consumer represent?
3.      What do the points below the consumer’s budget line indicate?
4.      What does the rate of substitution between two goods measure?
5.      Why does an indifference curve slope downward?                2013
6.      What does the rationality of a consumer indicate?
7.      What is demand function?                    2017
8.      What is normal goods, final goods and inferior goods?                    2012, 2015, 2018
9.      Define substitute and complementary goods. Give one example of complementary good.                    2013, 2016
10. What is convex preference?
11. In economics, it is generally assumed that the consumer is a rational individual.
12. What is a Giffen good?
13. What is consumption bundle.
14. What is monotonic preference of a consumer?
15. What is diminishing rate of substitution?                   2016
B. Short Answer Questions II type: (Marks 3)
1.      What is budget line? Why does it slope downward?             2013, 2017
2.      What is an indifference curve? What does an indifference map indicate?              2018
3.      What is demand curve? What does it indicate?
4.     Show graphically how market demand curve can be derived from individual demand curves. 2015, 2018
5.     Draw a vertical demand curve and state the nature of price elasticity on it.       2012, 2015
6.     Draw an indifference curve and state the reasons behind its downward slope.             2013
7.     Define and Distinguish between substitutes and complementary goods.           2015
8.      ‘The demand for luxury good is more price-elastic’ – Considering this statement state how nature of goods affects price elasticity.      2013
9.      Distinguish between change in demand and change in quantity demanded.                     2015, 2019
C. Short Answer Questions I type: (Marks 4)
1.     What is consumer’s equilibrium? Explain the basic conditions of consumer’s equilibrium assuming that the consumers only one/two goods.
2.      Explain the concept of utility function.                        2013
3.      What is total utility and marginal utility? Mention the relationship between total and marginal utility. 2019
4.      Explain with the help of a diagram why at consumer’s optimum point the budget line should be tangent to an indifference curve.                2015
5.     Show the shifts in demand curve and explain the situation under which it changes.     2015, 2019
6.     State and explain the law of demand with the help of a diagram. What are its assumptions and exceptions? 2012, 2013, 2014, 2015, 2016, 2017
7.     What are the factors affecting demand of a product?          2016
8.     Explain the concept of price elasticity of demand with suitable diagram. State the factors determining the elasticity of demand. 2013, 2014, 2016, 2018
9.      Explain various methods of measuring price elasticity of demand. – Percentage method, Expenditure and geometric method.
Chapter-3: PRODUCTION BEHAVIOUR, COSTS AND SUPPLY – 23 MARKS
A. Very Short Answer Questions: (Marks 1)
1.      What does the production function of a firm refer to?                     2018
2.      What is average product and Marginal product?                   2018
3.      What happens to total product when marginal product is zero?                2017
4.      Fill in the blank:  TC = ____ + TFC
5.      Fill in the blank:  AC = AVC + _____.
6.      Define average variable cost and fixed cost with example.   2013, 2014, 2016
7.      What does return to scale refer? What are its various stages?        2016, 2018
8.      What is TR, AR and MR?                        2014
B. Short Answer Questions II type: (Marks 3)
1.      What is return to scale and return to factor? Distinguish between them.
2.      Distinguish between input and output.
3.      Distinguish between fixed input and variable input.
4.      State the law of variable proportion. State its assumptions.            2013, 2014, 2015, 2017, 2019
5.      State the reason behind the U-shaped short-run marginal cost curve.
6.      What are various factors of production? State fixed and variable factors of production.                  2019
C. Short Answer Questions I type: (Marks 4)
1.     What is meant by Returns to Scale? Give the meanings of various stages of Returns to Scale.     2018
2.     Explain the relationship between average product and marginal product with the help of diagram. 2012
3.     What is variable cost? Draw and explain the shape of the average variable cost curve.                   2019
4.     Show the relationship between Average cost and marginal cost with a diagram.          2014
5.     What does the Average Fixed Cost (AFC) curve look like? Why does it look so? 2013, 2016, 2018
6.     What is isoquants? Explain graphically why it is downward slopping.                   2013, 2014, 2018
D. Long Answer Questions: (Marks 6)
1.     What is TC, TVC and TFC? Show with the help of diagram that the total cost is the vertical sum of total fixed cost and total variable cost.                        2012, 2016, 2018
2.     Explain the concepts of total product, average product and marginal product and also represent their relationship with the help of an imaginary table.              2015
3.      Show the relationship of short-run marginal cost, average variable cost and average cost with the help of curves and explain.      2017  
4.      What is implicit and explicit cost? Also distinguish between them.            2015, 2017
Elasticity of supply and supply curve
1.      State the law of supply. State various factors affecting supply of a commodity. 2014, 2016, 2017, 2019
2.      What is price elasticity supply? How can it be measured? Explain.
3.      Explain different kinds of price elasticity of supply with examples. 2019
4.      Show how a firm’s supply curve is affected by a unit tax imposed by the government.
5.      Explain the long-run and short run supply curve of a firm under competitive market.
6.      Mention three determinants of a firm’s supply curve under perfect competition.
Chapter-4: THE THEORY OF FIRM UNDER PERFECT COMPETITION
A. Very Short Answer Questions: (Marks 1)
1.      Fill in the blanks:  Under a perfectly competitive market each buyer and seller is a _____taker.
2.      Fill in the blanks:  For a price taking firm, average revenue is equal to _____.
3.      What is break-even point?
4.      Fill in the blanks:  Profit that a firm earns over and above the normal profit is called the _____ profit.
5.      Choose the correct portion:  The point on the supply curve at which a firm earns normal profit is called the _____. (shut down point/breakeven point),
B. Short Answer Questions II type: (Marks 3/4/6)
1.     Explain the concept of normal profit and super profit. Also distinguish between them.                  2014, 2018
2.     What is perfectly competition? What are the characteristics of a perfectly competitive market. 2012, 2014, 2015, 2018
3.     Prove that a firm under competitive market can not maximise profit at a points where price is greater than the marginal cost.                 2015
4.     What is the shut-down point for the firms under perfect competition? Explain it with the help of a diagram. 2013, 2015, 2018
5.      Explain why a profit maximising firm under competitive market will not produce at an output level where in the market price is lower than the AC in the long-run.
6.      ‘Under perfect competition in the long-run price must be greater than or equal to AC’ – Explain with suitable example.
Chapter-5: MARKET EQULIBRIUM
A. Very Short Answer Questions: (Marks 1)
1.      What is equilibrium price?                    2015
2.      What is an excess demand and excess supply?
3.      Name the situation in a perfectly competitive market in where a zero excess demand zero excess supply prevails.
4.      What is price floor and price-ceiling?
5.      Why ratio-coupons are issued to the consumers by the government?
6.      Choose the correct one: The upper limit of the price of certain commodity imposed by the government is known as _____           (price- ceiling/price-floor)
7.      Why does the government impose price-ceiling?
B. Short Answer Questions II type: (Marks 3/6)
1.     What are the objectives of a firm? When profit is maximum? 2012, 2018
2.     Explain diagrammatically the impact of simultaneous shift of demand and supply on equilibrium price and quantity.   2016, 2018, 2019
3.      State the conditions of equilibrium of a firm. Explain how short run and long run equilibrium price is determined under perfectly competitive market.        2016, 2019
4.      Explain the effect of price-ceiling on market equilibrium under the condition of perfect competition.
5.      Define long run and short run. Distinguish between short run and long run.        2017
Chapter-6: NON-COMPETITIVE MARKETS
A. Very Short Answer Questions: (Marks 1/3)
1.      What does the market demand curve express for a monopoly firm?
2.      Define Oligopoly.
3.      What is duopoly?
4.      Fill in the blank:  Profit = TC - ………………..
5.     ‘Monopoly firm is a price maker’ – explain.               2013, 2017
6.      During long-run firms can not earn profit but this is not the case with monopoly firm why? – Explain.
7.      Show the relationship between marginal revenue of a monopoly firm and price elasticity of demand.
8.      What is monopoly? What are the characteristics of monopoly market?   2016
9.      Define monopolistic competition. State its properties.                   2017, 2018
10. Distinguish between perfect competition, monopoly and monopolistic competition.   2019
B. Long Answer Questions: (Marks 4/6)
1.      Explain the concept of short-run equilibrium of a monopoly market by assuming zero costs.
2.      Explain why monopoly profit does not go away in the long-run.
3.     Explain the relation among the TR, AR and MR of a monopoly and perfectly competitive firm with the help of an imaginary table and diagram.                      2012, 2014, 2015,
4.      Show how does a monopolist earn profit by using total cost curve and total revenue curve.                   2012,
5.      Describe the price output determination of a firm under monopolistic competition during the short-run.
6.      Explain why does the long-run profit become zero for firms under monopolistic competition.
7.      Explain the implications of the features, “Product differentiation” and “Selling Costs” under monopolistic competition.              2016
8.      By using average and marginal cost curve explain how does a monopolist reaches its equilibrium position. Show the level of maximum profit in this respect.

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