Amity BBA Solve Assignment For Business Economics

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Business Economics (OBB 102) - Semester I

 

Section A

QUESTION

1          State and explain Circular Flow of Income and Expenditure.

2          What is Elasticity of Demand? Explain various types of Elasticity of Demand.

3          State and Explain Types of Cost.

4          Describe the Price and Output Determination under Monopoly.

5          Critically examine the Liquidity Preference Theory of Interest.

6          Describe Price and Output Determination under Monopolistic Competition.

7          State and explain the Law of Demand and explain determinants of Demand.

8          Write short notes: (any four)

(a) The Law of Supply

(b) Opportunity Cost

(c) Dynamic Theory of Profit

(d) Modern Theory of Rent

(e) Trade Unions and Collective Bargaining

(f) Scope of Business Economics

 

Section B

CASE STUDY:

U.S. Economy: Is Recession A Panacea?                                                                       

Since the end of the Second World War in 1945, consumption propensity in the United States started to increase significantly. Domestic savings remained too low for the country compared to other industrialised and developed nations throughout the 20th century. The gap between the US and other developed nations in terms of personal savings rate has widened since the beginning of the 21st century. The astonishingly high consumption demand had a dual impact over the economy. While it contributed significantly to economic growth, at the same time it led to huge current account deficits. It was argued that high spending sprees and the low personal savings rate were hidden threats and the country might face difficulties in the long run. As past experiences proved that consumer spending reduced during recessions, a section of analysts advocated in favour of recession in order to eradicate the economic imbalance in the US. As another recession was looming large in the US, in 2008, economists were wondering whether the Federal Reserve should allow recession instead of preventing it.

 

QUESTION 1

To highlight the distinctive characteristics of United States consumerism.          

QUESTION 2

To depict the United States economic scenario along with its high external borrowing.           

QUESTION 3

To analyse the impact and role of recession on the US economy.

 

Section C

QUESTION 1

The kinked demand curve explains?

                       

1. Price rigidity
2. Price flexibility
3. Demand rigidity
4. Demand flexibility

 

QUESTION 2

 

Imperfect competition was introduced by ____?

                       

1. Marshall
2. Chamberlin
3. Keynes
4. None

 

QUESTION 3

 

A situation in which the number of competing firms is relatively small is known as?

                       

1. Incorrect
2. Perfect competition
3. Monopsony
4. Oligopoly

 

QUESTION 4

 

Demand is a function of?

                       

1. Price
2. Firm
3. Product
4. Cost

 

QUESTION 5

 

The term group equilibrium is related to

                       

1. Monopolistic competition
2. Oligopoly
3. Duopoly
4. Perfect competition

 

QUESTION 6

 

Price effect in indifference curve analysis arises?

                       

1. When the consumer becomes either better off or worse off because price change is not compensated by income change.
2. When the consumer is betler off due to a change in income and price
3. When income and price change
4. None of the above

 

QUESTION 7

 

A situation where there is only one buyer is called

                       

1. Monopoly
2. Oligopoly
3. Monopsony
4. Perfect competition

 

QUESTION 8

 

Elasticity of demand measures the

                       

1. Sensitivity of sales to changes in a particular causal factor
2. Sensitivity of production to changes in a particular cost
3. Value of price and cost
4. Volume of product

 

QUESTION 9

 

Factors responsible for creating conditions for emergence and growth of monopoly are

                       

1. Control over strategic raw materials
2. Patents
3. Licensing
4. All of the above

 

QUESTION 10

 

"In the case of an inferior good, the income effect"

                       

1. Partially offsets the substitution effect
2. Is equal to the substitution effect
3. Reinforces the substitution effect
4. More than offsets the substitution effect

 

QUESTION 11

 

A market in which only two firms exist is

                       

1. Oligopoly
2. Duopoly
3. Duopsony
4. Oligopsony

 

QUESTION 12

 

Value maximization theory fails to address the problem of

                       

1. self-serving management.
2. risk
3. uncertainty
4. sluggish growth.

 

QUESTION 13

 

Selling costs have to be incurred in case of

                       

1. Perfect competition
2. Monopolistic competition
3. Imperfect competition
4. None

 

QUESTION 14

 

Which type of competition leads to exploitation of consumer?

                       

1. Oligopoly
2. Monopolistic competition
3. Monopoly
4. All of the above

 

QUESTION 15

 

The equilibrium is unstable and indeterminate under

                       

1. Edgeworth model
2. Cournot Model
3. Sweezy Model
4. Pareto Model

 

QUESTION 16

 

Demand curve is related to?

                       

1. MU curve
2. Marginal revenue
3. Both a and b
4. None of these

 

QUESTION 17

 

Market with one buyer and one seller is called

                       

1. Monopsony
2. Monopoly
3. Bilateral Monopoly
4. None of the above

 

QUESTION 18

 

The upper portion of the kinked demand curve is relatively

                       

1. More inelastic
2. More elastic
3. Less elastic
4. Inelastic

 

QUESTION 19

 

Which of the following is an important dynamic variable?

                       

1. Superior's style and behaviour
2. Organisational nature
3. The task structure
4. Cultural variables

 

QUESTION 20

 

How many sellers are present in duopoly?

                       

1. One
2. two
3. Three
4. four

 

QUESTION 21

 

Efficient allocation of resources is achieved to greatest extent under?

                       

1. Monopoly
2. Perfect competition
3. Oligopoly
4. Monopolistic competition

 

QUESTION 22

 

"For maximisation of profit in the short run, the condition is"

                       

1. AR = AC
2. MR = MC
3. MR = AR
4. MC = AC

 

QUESTION 23

 

Study of collusive agreement is

                       

1. Collusive oligopoly
2. Non-Collusive oligopoly
3. Monopoly
4. All of the above

 

QUESTION 24

 

"Under perfect competition, price of the product"

                       

1. Can be controlled
2. Cannot be controlled
3. Can be controlled within certain limit
4. None of the above

 

QUESTION 25

 

"If the demand curve confronting an individual firm is perfectly elastic, then firm is"

                       

1. Price taker
2. Adjust output
3. Adjust price
4. All of these

 

QUESTION 26

 

Cartels is a form of

                       

1. Collusive oligopoly
2. Monopoly
3. Non-Collusive oligopoly
4. None of these

 

QUESTION 27

 

Which one is not normally possible in case of monopoly?

                       

1. MC = MR
2. AC = AR
3. MR = AR
4. MR = PR

 

QUESTION 28

 

A firm's marginal revenue?

                       

1. is always negative
2. can be positive
3. is always positive
4. is positive at point at which the total revenue is maximum

 

QUESTION 29

 

"In a monopoly market, an upward shift in the market demand results in a new equilibrium with"

                       

1. A higher quantity and a lower price
2. A higher quantity and the same price
3. A higher quantity and higher price
4. All of the above

 

QUESTION 30

 

Demand Analysis includes:

 

1. Demand Forecasting
2. Demand Differentials
3. Demand Determinations
4. All of the above

 

QUESTION 31

 

In the case of monopolistic competition

                       

1. MR curve cannot be defined
2. AR curve cannot be defined
3. The short run supply curve cannot be defined
4. None of the above

 

QUESTION 32

 

Which economist stated the positive impact of monopoly?

                       

1. Marshall
2. Adam Smith
3. Joseph Schumpeter
4. Pigou

 

QUESTION 33

 

Average revenue is calculated by

                       

1. TRn - TRn-1
2. P x Q
3. TR / MR
4. TR/Q

 

QUESTION 34

 

Cross elasticity of demand between two perfect substitutes will be

                       

1. low
2. high
3. zero
4. infinity

 

QUESTION 35

 

"At elasticity of one, marginal revenue is equal to"

                       

1. one
2. zero
3. infinity
4. none

 

QUESTION 36

 

Shifts in demand curve include

                       

1. Increase in Demand (Upward shift)
2. Extention in demand
3. Contraction in demand
4. None of the above

 

QUESTION 37

 

An indifference curve is always

                       

1. A vertical straight line
2. Convex to the origin
3. Concave to the origin
4. A horizontal straight line

 

QUESTION 38

 

Price elasticity of demand provides?

                       

1. "A measure of the responsiveness of the quantity demanded to changes in the price of the product, holding constant. The values of all other variables in the demand function."
2. A technical change in the goodwill of the firm
3. A technical change in the cost of product
4. Technical change in the value

 

QUESTION 39

 

Given: Epx = Percentage change in Qy / Percentage change in Px. The above relationship is:

                       

1. Arc Cross Price Elasticity
2. Cost Output
3. Cost Profit
4. Capital Budgeting

 

QUESTION 40

 

In the calculation of elasticity, there is error in case of

                       

1. Arc elasticity
2. Point elasticity
3. Both (a) and (b)
4. None

 

 

 

 

 

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