EEC-11

                             FUNDAMENTALS OF ECONOMICS

                                                      TMA

                                  (Coverage: Blocks 1 to 9)

                                                                                                        Programme Code: BDP

                                                                                                             Course Code: EEC-11

                                                                               Asst.Code: EEC-11/AST-1(TMA)/2019-20

                                                                                                               Maximum Marks: 100

Note: Answer all the questions.

                                                      Section-A

Long Answer Questions (Answer in about 500 words each)                                         15x 2=30

1.    (a) What is the distinction between increase in demand and expansion of demand?

             Explain the various methods to measure the elasticity of demand. (10)

       (b) Given the demand function                                                                                                 (5)

                     qd = 650 – 5P – P 2 where P = 10,

             Find out the price elasticity of demand.

2.    (a) What is National Income? How the equilibrium level of income is determined?

           What causes changes in the equilibrium level of income?                                                  (10)

       (b) Given the following equations                                                                                              (5)

            S = -70 + 0.25Yd

            Yd = Y – T

             I = I0 = 40

             G = G0 = 30

              T = T0 = 20

        Find out the equilibrium level of income.

                                                        Section –B 

Medium-Answer Questions (Answer in about 250 words each)                                                          10x 5=50

3.    What do you mean by production function? Explain with diagram the three stages of production under

        fixed and variable proportions in production. Why does the law of diminishing returns operate?               4

4.    Find the equilibrium price and the quantity for the market whose quantity demanded and quantity

       supplied are given below:

         Qd = 220 – 5P

         Qs = -20 + 3P.

5.     What is price discrimination? Explain how will a profit-maximizing monopolist distribute output in different markets?

6.     What are the determinants of demand for money? Explain the Keynesian version in this regard.

7.     Do you think that the individual labor supply curve is backward bending? Give reasons for your answer.

                                                    Section – C

Short Answer Questions (Answer in about 100 words each)                                                                   10x 2=20

8.     Distinguish between any two of the followings:

        i. General equilibrium and partial equilibrium

       ii. Stock and flow variable

       iii. Positive economics and normative economics

       iv. Economic growth and economic development

9.    Explain any three of the followings:

       i. Economic agents

      ii. Multiplier

     iii. Hyperinflation

     iv. Bond Market

     v. Marginal revenue

      vi. Transfer earnings