Part B Answer any FOUR (4) questions of the SIX (6) questions. 1. Managerial economic decisions are an important component in achieving the objectives of the organization. The success or failure of a business depends upon the decisions made by managers. Define the importance of managerial economics in the context of business organization. 2. Monopolies are firms who dominate the market. A monopoly tends to set higher prices than a competitive market, leading to a lower consumer surplus. However, on the other hand, monopolies can benefit from economies of scale, leading to lower average costs, which can, in theory, be passed on to consumers. Distinguish between monopoly, pure monopoly and bilateral monopoly by providing specific support for your claim. 3. In a market economy, the compensation of labour is determined by the interaction of demand and supply in each labour market, relative compensation by the interaction of relative demand and supply. A higher price for labour leads to a higher quantity of labour supplied, a lower price leads to a lower quantity supplied and prices and wages help coordinate economic activities. Do you agree this statement if so Why? Perfect competition is a hypothetical market form associated with neo- classical economic theory. A number of assumptions are made which provide the key components of the definition, including: the existence of perfect knowledge, no barriers to entry and homogeneous output. Critically analyze the perfect competition and pure competition from the viewpoint of economics. 4. (10 5. The theory of price adjustment has been dominated by the idea that prices rise in the presence of excess demand and fall in the presence of excess supply. Discuss the two adjustments of long period monopoly price in the current scenario. 6. Monetary policy is an economic policy that manages the size and growth rate of the money supply in an economy. It is a powerful tool to regulate macroeconomic variables such as inflation and unemployment. In your answer please provide three examples of tools and objectives of monetary policy.
Part B Answer any FOUR (4) questions of the SIX (6) questions. 1. Managerial economic decisions are an important component in achieving the objectives of the organization. The success or failure of a business depends upon the decisions made by managers. Define the importance of managerial economics in the context of business organization. 2. Monopolies are firms who dominate the market. A monopoly tends to set higher prices than a competitive market, leading to a lower consumer surplus. However, on the other hand, monopolies can benefit from economies of scale, leading to lower average costs, which can, in theory, be passed on to consumers. Distinguish between monopoly, pure monopoly and bilateral monopoly by providing specific support for your claim. 3. In a market economy, the compensation of labour is determined by the interaction of demand and supply in each labour market, relative compensation by the interaction of relative demand and supply. A higher price for labour leads to a higher quantity of labour supplied, a lower price leads to a lower quantity supplied and prices and wages help coordinate economic activities. Do you agree this statement if so Why? Perfect competition is a hypothetical market form associated with neo- classical economic theory. A number of assumptions are made which provide the key components of the definition, including: the existence of perfect knowledge, no barriers to entry and homogeneous output. Critically analyze the perfect competition and pure competition from the viewpoint of economics. 4. (10 5. The theory of price adjustment has been dominated by the idea that prices rise in the presence of excess demand and fall in the presence of excess supply. Discuss the two adjustments of long period monopoly price in the current scenario. 6. Monetary policy is an economic policy that manages the size and growth rate of the money supply in an economy. It is a powerful tool to regulate macroeconomic variables such as inflation and unemployment. In your answer please provide three examples of tools and objectives of monetary policy.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
Transcribed Image Text:Part B
s)
Answer any FOUR (4) questions of the SIX (6) questions.
1. Managerial economic decisions are an important component in achieving the
objectives of the organization. The success or failure of a business depends
upon the decisions made by managers. Define the importance of managerial
economics in the context of business organization.
2. Monopolies are firms who dominate the market. A monopoly tends to set
higher prices than a competitive market, leading to a lower consumer surplus.
However, on the other hand, monopolies can benefit from economies of scale,
leading to lower average costs, which can, in theory, be passed on to
consumers. Distinguish between monopoly, pure monopoly and bilateral
monopoly by providing specific support for your claim.
In a market economy, the compensation of labour is determined by the
interaction of demand and supply in each labour market, relative
compensation by the interaction of relative demand and supply. A higher price
for labour leads to a higher quantity of labour supplied, a lower price leads to
a lower quantity supplied and prices and wages help coordinate economic
activities. Do you agree this statement if so Why?
3.
4. Perfect competition is a hypothetical market form associated with neo-
classical economic theory. A number of assumptions are made which provide
the key components of the definition, including: the existence of perfect
knowledge, no barriers to entry and homogeneous output. Critically analyze
the perfect competition and pure competition from the viewpoint of
(10
economics.
The theory of price adjustment has been dominated by the idea that prices rise
in the presence of excess demand and fall in the presence of excess supply.
Discuss the two adjustments of long period monopoly price in the current
scenario.
5.
6. Monetary policy is an economic policy that manages the size and growth rate
of the money supply in an economy. It is a powerful tool to regulate
macroeconomic variables such as inflation and unemployment. In your
answer please provide three examples of tools and objectives of monetary
policy.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education