Introduction to Micro Economics
1.Will the problem of scarcity disappear over time as standards of living increase?
2.Distinguish between the Real and Financial flows that link product and factor market?
3.Why do we study Micro Economics?
4.Explain how the introduction of Govt. affects the circular flow of economic activity?
5.“Scarcity of Resources is the mother of all economic problems.” Discuss with example.
6.Why can’t you buy anything you want? What is your main consideration what to buy and what not to?
7.What are the factors that make PPC upwards? Explain with the help of graph the upward slope of PPC caused by
a) Increase in supply of resources
b) Technology improvements
8. Why does intervention of Govt. in a free market economy often becomes inevitable?
1.How is the firm’s demand curve affected by the degree of competition existing in its Industry?
2.What is Bandwagon Effect and Snob Effect? How do they effect the Demand for goods?Draw Graph
3.Explain Giffen Paradox and Veblen Effect? Does usual Law of Demand apply in their case ?Draw Graph
4.Explain the effect on Market price and Qty in the market for mobile phones handsets of each of the following: Draw Graph a)Consumer Income rises
b)Technical Improvements reduce production costs
c)The price of fixed line calls falls sharply
5.List all the markets in which you regularly buy goods or services. How are the prices and Qty. determined during the transaction? Do these prices changes on a day to day basis.
6.An Individual Demand Curve slopes downward to the right because of: a)Income Effect of fall in prices
b)Substitution Effect of Decrease in prices
c)Diminishing Marginal Utility
d)None of the above
e)All of the above
7.Indicate what happens in the market for Hamburgers if:
a)Prices of hot dogs increases
b)A direct subsidy on each head of cattle is given to farmers raising cattle...