Class 12 Micro Economics - Chapter Production and Costs NCERT Solutions | When does a production function satisfy

What is the total product of input?

Why does the SMC curve cut the AVC curve at the minimum point of the AVC curve? 

The following table gives the total product schedule of labour. Find the corresponding average product and marginal product schedules of labour.

Explain the relationship between the marginal products and the total product of an input. 

What are the average fixed cost, average variable cost and average cost of a firm? How are they related? 

What do the long-run marginal cost and the average cost curves look like? 

What is the law of diminishing marginal product? 

Why is the short-run marginal cost curve 'U'-shaped? 

What does the average fixed cost curve look like? Why does it look so? 

What are the average fixed cost, average variable cost and average cost of a firm? How are they related? 

What would be the shape of the demand curve so that the total revenue curve is?

(a) A positively sloped straight line passing through the origin?

(b) A horizontal line?

Explain market equilibrium.

Discuss the central problems of an economy.

What are the characteristics of a perfectly competitive market?

What do you mean by the budget set of a consumer?

From the schedule provided below calculate the total revenue, demand curve and the price elasticity of demand:

When do we say that there is an excess demand for a commodity in the market?

What do you mean by the production possibilities of an economy?

How are the total revenue of a firm, market price, and the quantity sold by the firm related to each other?

What is budget line?

Explain market equilibrium.

Suppose the demand and supply curve of commodity XX in a perfectly competitive market are given by:

qD =700 - p

qs = 500 + 3p for p ≥ 15

= 0 or 0 ≤ p <15

Assume that the market consists of identical firms. Identify the reason behind the market supply of commodity X being zero at any price less than Rs 15. What will be the equilibrium price for this commodity? At equilibrium, what quantity of X will be produced?

What do you mean by ‘monotonic preferences’?

Consider the demand for a good. At price Rs 4, the demand for the good is 25 units. Suppose the price of the good increases to Rs 5, and as a result, the demand for the good falls to 20 units. Calculate the price elasticity.

How are the total revenue of a firm, market price, and the quantity sold by the firm related to each other?

What do you mean by the production possibilities of an economy?

How are equilibrium price and quantity affected when income of the consumers

a) Increase

b) Decrease

What happens to the budget set if both the prices as well as the income double?

What is the reason for the long run equilibrium of a firm in monopolistic competition to be associated with zero profit?

A shift in demand curve has a larger effect on price and smaller effect on quantity when the number of firms is fixed compared to the situation when free entry and exits is permitted. Explain.