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EFM Sample Questions Module 2 (Ch: 14, 15, 16, 17, and 21) 1. Define Define the competiti competitive ve firm and and explain explain the features features of competi competitive tive market. market. 2. Draw Draw the cost curves curves for a typica typicall competit competitive ive firm. firm. For a given given price, price, explain explain how the firm choose the level of output that maximize ma ximize profit. 3. nder what what conditio condition n will a firm shut down down temporari temporarily! ly! "xplain. "xplain. #. nder what conditi conditions ons will will a firm exit a market! market! "xplain. "xplain. $. "xplain "xplain the supply supply curve in a competiti competitive ve market includi including ng short run % long run. run. &. 'hat is is the meaning meaning of monopoly monopoly!! (nd (nd why monopoly arises! arises! ). "xplai "xplain n the natura naturall monopoly monopoly wit with h an example example.. *. Draw Draw the demand, demand, marginal marginal revenue revenue,, and margi marginal nal cost curves curves for a monopol monopolist ist.. +how the profit maximizing level of output. +how the profit maximizing price. . -ow economic economic well well eing is reduced reduced from from the monopoly/ monopoly/ss use of market market power! power! 10. Descrie the two prolems that that arise when regulators tell a natural monopoly that it it must set a price eual to marginal cost. 11. "xplain price discrimination discrimination in detail with two examples. 12. 'hat is oligopoly! oligopoly! "xplain "xplain with examples. 13. 'hat is a cartel and what uantity and price would they try try to set! 1#. -ow does the numer of firms firms in an oligopoly affect affect the outcome in its market! 1$. 'hat is prisoners/ dilemma and what does it have to do with oligopoly! 1&. 'hat is resale resale price maintenance and why it is controversial! 1). Define Define monopolisti monopolisticc competition. competition. 1*. Desc Descri rie e how how mono monopol polis isti ticc compet competit itio ion n like like mono monopol poly! y! -ow -ow is it like like perfe perfect ct competition!
1. Draw a diagram depicting a firm in a monopolistically competitive market that is making profits. ow show what happens to this firm as new firms enter the industry. 20. 'hat are the main differences etween monopolistic % perfect competition! 21. -ow might advertising reduce economic well eing! -ow might advertising increase economic well eing! 22. "xplain udget constraint and 4ndifference curve. (lso explain how consumer euilirium is achieved with the help of them!
Module 3 ( Ch: 23, 24, 25) 23. 'rite a note on circular flow diagram. 2#. 'hat is 5D and explain the components of 5D6. 2$. 'hat is real 5D6, nominal 5D6 and 5D6 deflator! 2&. 4s 5D6 a good measure of "conomic well7eing! 2). 'rite a short note on8 9onsumer 6rice 4ndex:964; . <= 'hat is 964! >ist the steps involved in calculation of 964. 2*. 'hich are the prolems in measuring cost of living! <= Descrie the three prolems that make 964 an imperfect measure of cost of living! 2. "xplain 5D6 Deflator versus the consumer price index. 30. "xplain the meaning of nominal interest rate and real interest rate. -ow are they related! 31. "xplain the productivity and its role and determinants. 32.
'hat are the 5overnment policy to raise productivity and living standard!
