Class 12 Micro Economics - Chapter Production and Costs NCERT Solutions | Let the production function of a firm be

What is the total product of input?

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? 

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

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

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

What is the law of diminishing marginal product? 

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

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

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

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?

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

How does an increase in the number of firms in a market affect the market supply curve?

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?

Consider a market with two firms. The following table shows the supply schedules of the two firms: the SS₁ column gives the supply schedule of firm 1 and the SS₂ column gives the supply schedule of firm 2. Compute the market supply schedule.

How is the equilibrium number of firms determined in a market where entry and exit is permitted?

What do you mean by complements? Give examples of two goods which are complements of each other.

The following table shows the total revenue and total cost schedules of a competitive firm. Calculate the profit at each output level. Determine also the market price of the good.

What is budget line?

Suppose a consumer’s preferences are monotonic. What can you say about her preference ranking over the bundles (10, 10), (10, 9) and (9, 9)?

Consider a market where there are just two consumers and suppose their demands for the good are given as follows:

Calculate the market demand for the good.