Eco 421 ( 2078 paper)
Attempt any two questions from group A and four from group B
Group A ( Long question answer) 30 marks
Define cardinal utility and explain how consumers attend equilibrium under the law of diminishing marginal utility.
What do you mean by production function? Explain the law of returns to scale.
Explain the price and output determination under monopolistic competition.
Group B (short question answer) 40 marks
Discuss the effect of minimum wage laws on employment with an appropriate example.
Define the demand function. What are the determinants of demand?
Explain the relation between TR, AR and MR in competitive market.
Explain decomposition of price effect into income and substitution effects using hicks approch.
What is profit? Explain the dynamic theory of profit.
What is general equilibrium? Explain efficiency in production using an appropriate diagram.