Explain the First Fundamental Theorem of Welfare Economics.
Alright, let's delve into the First Fundamental Theorem of Welfare Economics. In the world of introductory microeconomics, this theorem is like the guiding star for those navigating the waters of market economies.
At its core, the First Fundamental Theorem of Welfare Economics states that under certain conditions, competitive markets lead to an efficient _____ ________ ____ ____ ___ __________ _________ _________ _________ ________.
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iii) Prakarana
A Monopoly faces market demand given by Q = 30 – P, where Q stands for quantity and P for price. Total cost function is given by C(Q) = 2Q2 . Find the profit maximising price and quantity and the resulting profit to the monopoly. Compare your results with the equilibrium quantity and price of that of a perfect competitive industry.
4. Write a note on Jain influences in Cilappatikaran.
4. Comment on the female presence in Cilappatikaran.
Consider the demand curve AC of a good in Figure 2. Given distance AB and BC as x and y, units respectively,
(i) What will be the price elasticity of demand for the good at point B? What will be the price elasticity of demand for the good at point A and at point C?
(ii) Given that price elasticity at point B is 1, how x and y will be related?
Consider Figure 1 below where MC, ATC, AVC, D, and AR represent the marginal cost, average total cost, average variable cost, demand, and average revenue curve respectively under a perfect competition. Based on the figure, answer the following questions: 10
(i) What is the profit maximising level of output for this firm in the short-run? At this quantity, what is the marginal revenue?
(ii) How much is the total cost for this firm in the short-run equilibrium?
(iii) In the short run, is the firm making economic profit or suffering loss? How much is that profit or loss? Should the firm shut down?
(iv) What is the fixed cost of production faced by this firm?
(v) What is the break-even price for this firm? What is the shut down price for this firm?
(vi) If fixed cost increases further, what impact will this have on this firm’s profit maximising level of output in the short run?
2. Discuss the significance of the Palace of Illusions/ Maya in the Mahabharata.