modelpapereconomicsbcom2009termsystem

8/7/2019 ModelPapereconomicsBCOM2009Termsystem

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Course Outline

Course Title: Micro Economics B.Com (Term System) Term I Paper I

Course Objective

1. To let the students develop good understanding of Micro Economic concepts

2. To make the students aware of basic concepts that underpin all of the economic decisions


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Topics Source

(1.1)Basic economic ideas Trade Offs, prices and market,

equilibrium, theories and models, positive and normative economics

Book1(Ch.1)

Book3(Ch.2)

Section A

(1.2)What is Market?, Competitive and non competitive markets,

market price, market definitions- the extent of a market

Section A

(1.3)Scarcity choice and resource allocation specialization and

exchange, absolute and comparative advantage, production

possibility curves, positive and normative economics

Section A

(2.1) Demand/Supply analysis Law of demand and supply,

individual demand curves

Book1(ch. 2,4)

Book2(Ch1)

Section A

(2.2)Market demand curve/supply curves, factors affecting(shift of

demand and supply curve)

Section A

(2.3)Concept of elasticity along with its business relevance,

consumer surplus

Section A

(3.1).Theory of consumer behavior cardinal/utility approach, law

of diminishing marginal utility, law of equi marginal utility.

Book1(ch3)

Book2(Ch.2.3.4)

Section A

(3.2)Ordinal/indifference curve approach, properties of indifference

curves, consumer budget line, shift and consumer equilibrium. price,

income and substitution effect.

Section A

(4.1). Theory of production The technology of production,

production function, short run and long run production function, Book3(ch5)

Book1(ch5)

Section A

(4.2)Production with one and two variable inputs, isoquants, returns

to scale and scope.

Section A

(5). Cost of production measuring cost, different cost concepts,

different cost curves in short run and in long run, the learning

curves(a dynamic change in cost).

Book1(ch6)

Book2(ch8)

Book3(ch5)

Section B

(6.1). Market structure perfect competition( a perfectly

competitive market), profit maximization, Marginal revenue,marginal cost, and profit maximization, choosing output in short

run, the competitive firms short run supply, choosing output in long

run, the industrys long run supply curve

Book1(ch.9.10.11)

Book2(ch9 to 13)

Section B

(6.2)Monopoly, average and marginal revenues, the output decision,

Monopoly power, sources of monopoly power, sources of monopoly

power, the social cost of monopoly power, monopsony and

monopsony power

Section B

(6.3)Monopolistic competition, the making of monopolistic

competition, equilibrium in short and long run, monopolistic

competition and economic efficiency

Section B

(6.4)Oligopoly, Equilibrium. in oligopolist market, price and non

price competition, cartels, price leadership

Section B

(7.1).Labor market Demand for labor, labors marginal

productivity, supply of labor, Wage rate determination, S/R and L/R

supply of labor

Book1(ch13)

Book2(ch14/15)

Section B

(7.2)Monopsony power,( marginal and average expenditure), the

input purchase decision of a firm, factor market with monopoly

power,

Section B

(7.3)Indifference curve analysis of labor supply, the elasticity of

substitution and change in the relative factor shares, monopsony

when several variable inputs are used.

Section B

(8.1).General Equilibrium and Economic Efficiency General

equilibrium. Analysis, Efficiency in Exchange, Equity and

Efficiency

Book1(ch15) Section B

(8.2)Efficiency in Production, (production in edgeworth box, input

efficiency, producer equilibrium. in a competitive input market, the

production possibility frontiers. The Gains from free trade

Section B


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Recommended Text:

1. Pindyck Robert S & Rubinfeld Daniel L. (2005) Micro Economics Pearson

2. Gould Johan.P & Lazear P. Edward (2001) Micro Economics All India Travel Book Seller 6TH

edition

3. Hailstone J. Thomas & Mastrianna V. Frank (2004)Basic Economics Thomson 13th edition

Further readings:

1. Bamford Colin (2002)Economics Cambridge University Press

2. H. Craig Peterson W. Cris Lewis (2004) Managerial Economics Pearson Education (4th edition)3. Salvator Dominick (2004) Micro Economic Theory and Application New Oxford University Press 4th

edition

4. Colander C. David (2006)Economics McGraw Hill 6th edition


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MODEL PAPER FOR B.COM Term-IMICRO ECONOMICS

Section II & III

Time Allowed = 100 minutes (1hour and 40 Minutes)

Section II SAQs- (Attempt all questions) No. of Questions =11

Marks=22

Answer Following Short Questions. (11 2 = 22 Marks)

a) What Micro Economics deals with?

b) What is the difference between positive and normative statements?

c) What are competitive and non competitive markets?

d) What ate the two basic phenomena upon which demand depends?

e) Why ordinal approach best explains about consumer behavior?

f) Differentiate between short run and long run production scenario?

g) What are the reasons for rising average variable cost in short run and in long run?

h) What is the difference between Monopoly and Monopolistic Competition?

i) What is marginal revenue product of labor

j) Explain the term efficiency in detail?

k) How do p0roductive efficiency differ from technical efficiency?

SECTION-III (Essay Type Questions) Marks=30

Note: Attempt ONE question from each Part.

PART-A

Q. 2) (15 Marks)

Explain in detail the problems faced by less developed countries in case of Production Possibility Frontier?Q. 3) (15 Marks)

Explain why do Price Effect= Income Effect + Substitution Effect

PART-B

Q. 4) (15 Marks)Write a Berief Note on Perfect Competition?

Q. 5) (15 Marks)Wage Determination in fully competitive market differs from non competitive market, Explain?


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MODEL PAPER FOR B.COM Term-IMICRO ECONOMICS

SECTION-I (MCQ- All questions are to be attempted) Time Allowed = 23 MinutesNo. of Questions =23

Marks=23INSTRUCTIONS TO CANDIDATES:

Encircle the correct option only.

Cutting, overwriting and use of ink remover is not allowed.

Q 1) Knowing that consumer has limited resources thatswhy he

a) Never wants to maximize his wellbeing

b) Wants to maximize his satisfaction

c) Trade offs the purchase of more of some goods forthe purchase of less of other

d) None of the aboveQ 2) Production Possibility Curve never show

a) Relationship between scarcity and choiceb) Alternative goods and services to be produced

c) Opportunity cost that producer bears on producingadditional of one product

d) All (a,b&c) are incorrect

Q 3) The term demand means

a) Amount of a product consumer purchases

b) Amount of a product consumer wishes to purchase

c) Amount of a product consumer are willing to buy athe price per unit changes

d) All (a,b&c) are correct

Q 4) Budget line showsa) Spending by consumer on different goods and

services

b) Opportunity cost bared by a consumer movingfrom one good/service to the other

c) Different combinations of goods and servicespurchased within given resources

d) All (a,b&c) are correct

Q 5) The concept of Diminishing Marginal Utility states

a) More we get of one thing less we could get of theother

b) Trade off between two productions w.r.t utility

c) Going to lose the utility as dropping units of thesaid product

d) All (a,b&c) are wrongQ 6) Production Function Shows

a) Maximum output gained by a given set of resources

b) Extent of labor and capital being used to producean output

c) Amount of output expected form various inputs

d) All (a,b&c) are true

Q 7) Sunk cost does not mean

a) Cost this is recovered

b) Its association with forgone alternativesc) Both are correct

d) All (a,b&c) are false

Q 8) Monopoly does not exist when

a) There isnt any rival

b) There are rivals and competitors

c) There is only one producer

d) All (a,b&c) are incorrect


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e)

Q 9) In oligopoly, dominant firms face a problem in

a) Setting price that never let small firms to sell theiroutput

b) Setting price that let small firm to sell their output

c) Setting price where they could get max profit

d) Setting price that help them achieving maximumreturns and letting small firms to sell their output

on it.Q 10) Perfect Competition is a market situation where

a) Firms are price takers

b) Resources are not perfectly mobile

c) Firms possess complete knowledge of the market

d) All (a,b&c) are true

Q 11) Demand for the factors does not depend on

a) Revenue of the firm

b) Supply of factors of production

c) Both are correct

d) All (a,b&c) are wrong

Q 12) Marginal revenue product curve of labor showa) Marginal productivity of labor

b) Max firm is willing to pay to the factor input

c) If its higher than wage rate, firm to continue withit

d) All (a,b&c) are untrue

Q 13) It is difficult for a firm to demand factor ofproduction as

a) Both are expressed/ traded in different market

b) Producer does not have enough knowledge aboutmarket trend

c) Change in price of the one effect the supply of theother

d) Change in price of the one effect the demand of the

otherQ 14) When output/input market is perfectly competitive

a) Resources are used inefficiently

b) Difference between total benefit and total cost isminimum

c) Difference between total benefit and total cost ismaximum

d) Factor of production is available at cheap price

Q 15) Comparative Advantage Theory states to

a) Concentrate on producing the product whereproducers are having losses

b) Concentrate on producing the product whereproducers are having profit

c) Concentrate on producing a product the cost ofproduction of whom is relatively higher than cost

of production of the other one

d) All (a,b&c) are false

NOTE: Only 15 MCQs (5 MCQs from each section) are provided for specimen purposes.

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