Hbc2104:Introduction To Micro Economics Question Paper
Hbc2104:Introduction To Micro Economics
Course:Bachelor Of Commerce
Institution: Meru University Of Science And Technology question papers
Exam Year:2010
QUESTION ONE – (30 MARKS)
(a) Explain the main economic problems from the production point of view. (5 Marks) (b) Define monopolistic competition and explain its features. (7 Marks) (c) With the help of a diagram, explain the concept of market equilibrium. (6 Marks) (d) Define economic law and explain its nature. (6 Marks) (e) Using demand and supply functions of a commodity, compute the equilibrium price and quantity. Qd = 100 – 2p Qs = 40 + 4p (6 Marks)
QUESTION TWO – (20 MARKS)
(a) Using a well illustrated diagram, state the law of demand and explain the conditions under which it can operate. (10 Marks) (b) Define monopoly and explain its causes. (10 Marks)
QUESTION THREE – (20 MARKS)
(a) With the aid of a diagram, define a shift of the supply curve and explain its determinants. (10 Marks) (b) State the law of diminishing marginal utility and explain its limitations. (10 Marks)
QUESTION FOUR – (20 MARKS)
(a) With the aid of a well illustrated diagram, explain the stages of production.(10 Marks) (b) (i) Distinguish between arc and point elasticity of demand. (4 Marks)
(ii) Study the following demand schedule and the question that follow.
Price of Commodity (Ksh)
Demand (Kgs)
50 60 70 80
25 20 15 10
Compute arc elasticity of demand in the price range from Shs60 to Shs70. (6 Marks)
QUESTION FIVE – (20 MARKS)
(a) Define economics of scale and explain the main internal and external economies of scale. (10 Marks) (c) Define marginal productivity theory and explain its limitations. (10 Marks)
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