Class 12 Micro Economics - Chapter Production and Costs NCERT Solutions | The following table gives the total prod

What is the total product of input?

Let the production function of a firm be Q=5L1/2K1/2Q=5L1/2K1/2 Find out the maximum possible output that the firm can produce with 100 units of LL and 100 units of KK.

When does a production function satisfy decreasing returns to scale? 

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

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

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

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? 

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

What is the law of variable proportions? 

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?

Compare the effect of shift in the demand curve on the equilibrium when the number of firms in the market is fixed with the situation when entry-exit is permitted.

There are three identical firms in a market. The following table shows the supply schedule of firm 1. Compute the market supply schedule.

The market demand curve for a commodity and the total cost for a monopoly firm producing the commodity are given in the schedules below. 

Use the information given to calculate the following:

(a) The MIR and MC schedules

(b) The quantities for which MIR and MC are equal

(c) The equilibrium quantity of output and the equilibrium price of the commodity

(d) The total revenue, total cost and total profit in the equilibrium

How will a change in the price of coffee affect the equilibrium price of tea? Explain the effect on equilibrium quantity also through a diagram. 

How are the equilibrium price and quantity affected when?

(a) Both demand and supply curves shift in the same direction?

(b) Demand and supply curves shift in opposite directions?

How is the wage rate determined in a perfectly competitive labor market?

What will happen if the price prevailing in the market is?

i. Above the equilibrium price

Ii. Below the equilibrium price

At what level of price do the firms in a perfectly competitive market supply when free entry and exit is allowed in the market? How is the equilibrium quantity determined in such a market?

How do the equilibrium price and the quantity of a commodity change when the price of input used in its production changes?

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.