Eet 100: Microeconomic Theory 1 Question Paper
Eet 100: Microeconomic Theory 1
Course:Bachelor Of Economics
Institution: Kenyatta University question papers
Exam Year:2016
KENYATTA UNIVERSITY
EET 100 : MICROECONOMIC THEORY 1
CAT 1 DATE: 19/10/2016 TIME: 2.00 - 2.45PM
instructions :Answer all questions.
1. Distinguish between the following concepts (10marks)
i) Scarcity and opportunity cost
ii) Equality and efficiency
iii) Point elasticity and arc elasticity of demand
iv) Firm's supply and market supply
v) Stable equilibrium and neutral equilibrium.
2. The demand and supply curves of a good in its market are given by the following equations.
0.2P2 + 2P+Q=100 Demand
0.3P2+4P-Q= - 100 Supply
Where People is per unit of the commodity in Ksh. And Q is quantity.
i) Determine the equilibrium price and quality (5marks)
ii) The government wishes to fix the price of the commodity at Ksh. 5. Explain what will happen in the market for the good. (5marks)
iii) Find the price elasticity of demand when P=10 and interpret the results (5marks)
3.Explain the factors that influence elasticity of supply (5marks)
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