: PORNWIMEATL Fundamentals of Economics ‘Maximum Marks: 100 Pass Marks: 40 Attempt all auestioas ts are required to give answers in their own words as far as practicable. (5x2 -80} Select the corect answers from the followings. . omist to have coined the terms “Micro Economics’ and “Macro koe Ne todas Frisch 4, Inving Fisher pices ca ammarized in five big questions. They are - Who, where and would you please, 2. Why not, what, how, when and where env, when, where and why What, how, when, where and who ish cases and effect relationship which are trie under certain - Agsutnpiious 3. Normative Scleuces dh. Relations was the first Econ ative statement 3. Both a quantitative and qnalitative ser fa) not (b) c. “Other things remaining the same * the law of demand states: - : (Laimand for a commodity is inversely related to price 2. As demand rises, prices rise ice ig related to demand 4, ‘The demand for a commodity depends'upon its price level come and price ef related goods. ; £ What x the shape of AR curve faced by « firm under perfect competition? AGnivontel , Vertical 3. Positively Sloped 4. Negatively Sloped Which of dhe following is not a characteristic of a price taker? (J eeantively sloped demand curve 2.TR=PXQ_ 3. AR= Price 4. MR = cen momo increases by 29% and the quantity demanded falls by 2595. er 7: h. The price of ch ‘This indicates that demand for momo is Phase 2. Inelastic 3. Unitary clastic 4, Perfectly elastic ‘A riglutward shill in supply curve is the result of- in the nuinber of producers supplying the goods 2. Cartel of st 3. Anct 4. Economic cost means- 3, Lmplicit cost plus fixed costs 4. Sunk cost plus va k. The structure of chowchow (instant noodles) industry 1. Perfectly competitive market. FA isi Competitive market. 1A firm hasa variable cost of Rs. 1,000 at $ units Be: average total cost at 5 units of outprmm, Cost that firms incurs in hiring or purchasing any factor of production is referred (0 6 UFplicit Cost 2. Variable Cost 3. implicit Cost 4. Fixed Cost n, All money costs can be regarded as- 1, Social Costs, 2 Explicit Costs 3. Oppriunity Costs 4, Real Cost o. Variable cost includes the cost of ~ . Hiring the buildingfor the factory 2. Purchasing heavy machine : ; b ‘aying to manager of the factory 4 Paying to laborers {10x2 - 20) ne iy a good example of Gillen goods. F Marginal Uulity analysis is ordinal & indifference curve analysis is cardinal utility analysis. Prof. JM Keynes defined economics as a science of wealth. Indifference Curve is always concave to origin. F 7 When MP is Zero, TP is in highest point. oy factors of production. F 4. VAT is an indirect type of tax. TT Capital is not perishable than other f Public Enterprises are established by general public. | a Da i. Presence of large number of middicmen is very good to Nepalese agriculture inarket. FE An industry ith an investment of Rs 10 crores's cassie 0S eae em Industry as per Industrial Policy of Nepal, 2049. F. ; i Q.No3. Answer annie of the following questions. +. 10-20) Define Micro and Macro Economics. Explain how a Kathmandu businessman can be benefitted by the study of Micro Economics. a sing Marginal Uslity? Mustrate its 6. What do you mean by Law of Dimi ing appropriate examples. ‘ b 8 © What do you mean by International Trade? Discuss the benefits of international bade to Nepal. , oh ' Q.No4 Ansiver the following questions. Explain clasticity of demand and its measurement of price, 2 ; . Explain the concept of Total Revenue (TR), Average Revenue (AR) and Marginal Revnue (MR), J Enumicrate the specific features of Monopoly Market, 4. Name the organized and unorganized sources of agriculture finaneg; Q.No 5. — Point out at least tvo major differences between: a Price Elasticity and Income Elasticity, J ib, _ Fiscal Poliey-and Monetary Policy. t a © Bixed cost and variable cost. , | : | i 4 Tndusrty and firm, a a : | :NE AXWE\ G ped dermand Ca Pid. UY. ee ee | ag, + a ae Pa | | | | | i| Solution No! 4 Ci) : A Anesease in the number at pradacer i SRRYRG ahe goods i _ Solwhion Ato! 4 aA) cok Tay a aoe ae pe oe casts Salvin, no! “ACh wt es nano cane make 28 Hy une ete lation AU Nod) HB ea i eae ee A oi a See -3Explicib cost reer ML Be lil a Che ae Sottin aah tyig iS a ie Lisi +19. Exphcit. Kenge i gy ao = oe oe ang Ay _lalurerg 7dSolution Not 2 Ca). false a » ReaS.o >. GIP Ren fyeele axe interior rior ar basic praducks Lost. | ki item Atkia» cel) Phone. is_an | —exdmple of PU ee ki hee i isnot a Liesahpe a ten gad lea ie AAD aklan JE Mah a | ( oi A i) any Mis Lo ee , “pad indi recdh LO. indinet. ayesSalution No! ale) oe ae So | Sensdo2 anditterence ea -eusye | is agg canna a ee ee | Reason: TP_ confines. 4 increase ata _ aimsinishin | — _ Tate unitl_it_seaches “ik hyahest» point anes | __ mp _aye dimini unit ibYeaches Zeta in an the Kecand. go, edned 21s highest Lae imsidb samp is Ae Win See Golwtion nto! 2(q) Liao iit vi ips fa} Aa 1 } Ach is uged —Prnduchan oF snore 1S called : Met ;‘rue Jit ‘Reagan: ne enterpices Perey a # ent quvemment. 4p. care a CUS pubic enterprise. ¢ . e eer era ales t see [Rasa “ mepalese.. farmer a OQ —praducbial. moa Tea of site ae ey of _middletnan. aera a Muve markebs $eoe P86 ye AS. i) { | i fa linet 10 iis Todi Sie aie Aecarding ae the abwe Schedule, when cor Feongumes Onib d veh she. coimmadigy 4) Bath /io lhnd axe equal 4d /8-o ff! hes continia an 3 and Wok ‘cordenadity 1 mo. a aw Ai nu Increase Lat dininishi ES he consumes. om s said i hiahest. celal utili and _2e%D _maygina th. Med point. oF umapaia. at. nee Yokioby! 3% | Coit 6 - Consames ‘ lo Peed Pe m. + a a i}hen_a consumer gradually increase onib of }Corotnadrhy cengumed total whiihy incieases ab bench Yate but magia Tihy ges on_deScr tuhen_CanSamers or. mb_6F Comma 4 ‘bt eee dink, baka) wttirty becomes. — Resta Sab ow Beenie Jer. aden _conSunet ansumes additional unit. ot angele end 2 —_dipsink sot Satiely itu becomes we And TW ft opie Aesateage: eee ae Ca fi ams BY Tag Op Gh _{y when -cangumers abies arise “such as_call lef ald_cain yx hng et then consume _Raerifice more time. and efforts 4a ol Sach < ini ng ¢ Col Salisticatan qa does an increase: the persan aha have ty craze toe backs .m ecto ddtain mare ot mate oh) successi- eon x Such shings a y Q_HetSo Sis Inabitnated ide use al rads eke oblitu om.Such_ ¢a inoterbe hemnuse change tn meta PERRY \chty 2 a vas 4 UE CoD HMONS- BLL eo Ce Goes 3 NCTeanNa.»Saludion: NO? ACed re Trade helmeecd_on_ ama countries oP the eotld actoss braaders_ is called’ ag inter national trade pecially, sin cage OF developing countries: like Nepal, whet te aba intensive ribsh Age esha dh dire 4p lack ak capital and ather Supplementary Pacer of production «Tt. is nab ee te mo duce ‘om ecpeds and services ahi they: consume and hy an ‘port Goods andi Services. fuin forejqn. countries : other hand when th even tw \ Yaw talenials..4 Le a ein income Hi abies pf Heh Y pute ae | ig oo me Seat | OSs ENO FumCemeinand With 4 #8 Elasticity af Demand is dering’ Jas dhe responsiveness of Change in demand Por. one camenadity wD dine change 19. Mice of anathe h iad +P Ga OMNYS dip fe Ny fs zal Vo 4 i Saar) Orage Chaniae in demand 4 OL AGod-x | Pevcen age chang? in_plice ot god ¥Rig detined ag Ane tela). [a oe 4. Geller or producer received Prom Ae |Sale ot given quantities ef a product: Tk is equal. hp tytal “quantity sald uate PRO. Powe Aes ae Paice fp re 2. e Revenue (HB) is Alvided Mokal ig ‘chanwe in PNT a Ay _otYoutput sold: In othe ik dhe tion do cada peat 0 cat nd Kev enue COR) 1So\u}ion Alo> 400) | Monopoly ic dhe market structure 'o hich, Bhere ig Sige eller oF pee having no liclose Substhites: A Specific Senhute ot monapal matk- ie are oe below: 7 iBidale Bled ond Aa ie Humber oF hay exs 4 iy JB uch adel there ould be. cue Seller. of a. coxa bayers ot the | igre ck are An Aveo ae Be fi + Psbsence of ice substies ii gy ee as reduces ‘a. comme-_| 4 dot ha. oo ala 4 cogs _pret iL rmaxinni ee ne ig ddimaximise | Pe cons Seen has fal) conta) pr HS IpNiese e wed OPr recchit wie Pik-kincindl as k) Reginicts e emey of new firing. ~S+ Glution Moz 4 (a) The marganized gaurce of aavicathure Binande available an epa_are awven Ayaits i) fe Sia Q) many lenders and Landlords They are main suppliets of ahoteteben and lang-berm credits ice Neplese Farmers For produchve os twelhs unproductive: furpases:“The\e! loan advancement Dwdess. is Flexible and loan boas Fixed Soe ip (8) Traders and rae Rabndige i cis 3 provides ded oglide farmers for rae Ur POSES befare the. hatuest. is Uxeady on dhe condition thal they (Parmer) tail) sett Ee 4p dhem at. ged PET ned_ prices: 4 opine oo of agit Rinance been in Neb ave_aiten below iP te ) Orameen Rikash bathe si ‘ th They provide Loane agsisban to poor women From hagehalds eath. less than -o& hedBa WA hc hediae Gn hits .axe identified Laan i -eptended an grattp members agains gToape j cemahare pevolopmonk Bank, Alepa CADBLAD— Ware ot “accounts: for 7a to 2S. Yo ricultural aang dichursed on a inst i zed bagis’ 1 also provide. Joon assistance atm - fess ating _cooperaiive. and Sajna Sociehes Obs 1 itepa). — Pioulew meme 2 ‘ Banks cid 9 hi Dre banks _praride loa Ns_on ieo\late rece fe > Jow- incarme Para {ice onder _prsduehion credit For Rural toonen CPCR and wicto-credik Paject for Rural women and offices onder the minisigy 5 Dewelaprment:or a z ble spl hy hy pilifical| ependent WW Figcar Polk er wes ions Solution. Alo’: Sta) im | Price. ovr Ug oceme eesti le ee —}— Elastic: WBE igy ak ashe Sespin-| aie is. defined as’ the ISiveness && change in “3 Sue ci the ene iolbecdie cs . Sa Aemanda Ar the wha Lia cod ty. the. in jnco- ifrice of the nikeroadith melo the: con Hl b meus of price elasticity bake us use 2 fi income tele ! are {rice deherwination, w ue Demand, farecastiqg te eterminahon ete: Know About _of Atade. f, Be fee Ble “Es | Solution No! S(b) pe Picco) rely Ns igo gali quae j 48 of 2p ia The reset see 1 tox and guint a Dhee is _no_efFect on ion igher_interest rake cau- 5 ie. rabe.., ig changi wien i eya j luion No «CO | Fixed cost Vs variable cost | 4 ; y riahle cosh by ab. ic the expense ‘incurt.j\) 3b is the ots ordi Hod hy Fixed Factors oF Pr0-| by variable Factor a Wductinn oft) ae 9) IL. nemdins Hinstdnlashalf) rt 7a wrth choy lever bedhe leva of output jin owlpe a Po fie hs cn ig) A Fitm gives combourty Ip ptaductitn even at-them. | production on if these™ is of Fixed cost a \oss af variable cost —-Solubon Ato: (4) itt r 1p. oF {W-Fitm isa onib of nda aos: ‘Netucing which produce the prada (product: | Lb E ai Gy -aftect held) Single Fite cannok ath Hs indwid al ef. The price by HS individua) D buat lettads dl 8) firtn_is discrehe eps ah