Datta Meghe Institute of Management Studies
Managerial Economics – Unit 1 & 2
MBA II Semester
Faculty – Archana Shrivastava
Unit1- Fundamental concepts of Managerial Economics
Q. Discuss the utility of demand forecasting. What are the criteria of a good
forecasting method? How is forecasting different from ‘prediction’?
Or
Discuss briefly the various methods of forecasting demand and point out their
limitations.
Q.1 Define managerial economics and evaluate its role in managerial activities.
Or
Explain the various functions of managerial economist. How can she best serve the
management?
Or
Discuss the application of basic economic theory to the problem of business firm.
“Managerial economics is the integration of economic theory with business practice
for the purpose of facilitating decision making and forward planning by
management.” Explain.
Or
“Managerial economics is the application of economics in analyzing business
decision.” Discuss.
Or
Distinguish between macro economics and micro economics. Explain how is macroeconomics useful in managerial decision making.
Q. What is the significance of demand analysis to a sales manager of a business firm?
Explain the important determinants of demand.
Q. “If demand is elastic, it will pay a business man to charge relatively low prices; if
the demand is inelastic, he would be better off with a higher price. Discuss and point
out the role of price elasticity in business decision.
Q. Discuss various types of elasticity of demand. Explain the methods to measure
elasticity of demand.
Q. Define elasticity of demand and distinguish between point elasticity and arc
elasticity. Explain the method of measuring point elasticity.
Or
Q. Define factors affecting elasticity of demand and the various methods to calculate
it.
Q. What is elasticity of demand? Explain giving suitable illustrations, how elasticity
of demand determine the price policy of a firm.
Q. “The concept of elasticity of demand and demand forecasting are versatile tools of
economic analysis.” Discuss the validity of the statement with appropriate example.
Unit2- Production
Q.1 Explain the concept and managerial uses of production function.
Q.2 Explain isoquant and law of variable proportions.
Q.3 Discuss total product, average product and marginal product.
Q.4 Explain with the help of imaginary figures - total fixed cost, total variable cost, total
cost, average variable cost, and marginal cost, average cost.
Q.5 The long run average cost curve, though U shaped, will be flatter and less
pronounced than the short run average cost curve. Explain with the help of diagram.
Q.6 Discuss various economies of scale.
Q.7 Discuss cost concepts relevant to managerial decision of planning and control.
Or
Q. What is meant by economies of scale? What are the different sources of internal and
external economies of scale?
Q. Explain the concept of cost output relationship in the short and long run.
Unit3- Market structure
Q.1 What do you understand by monopolistic competition? How is price and output
determined in short run in a monopolistically competitive market?
Q.2 What is monopoly? Explain how price and output strategies are adopted under
monopoly.
Q.3 Explain the relationship between price and cost of production for a firm under perfect
competition in
a. Short run
b. Long run
Q.4 What are the essential conditions of a perfect competition? Distinguish it clearly
from imperfect competition.
Q.5 Explain product positioning and pricing in oligopoly.
Q.6. What is the difference between perfect competition and monopolistic competition?
Show how price is determined under monopolistic competition.
Q.7 Discuss short run equilibrium of a competitive firm earning supernormal profit,
suffering losses, long run equilibrium of competitive firm.
Q.8 Discuss concept of oligopoly and its various models.
Unit4- Pricing in practice
Q.1 What is meant by price discrimination? Discuss various degrees of price
discrimination.
Q.2 What do you mean by price discrimination? What is discriminating monopoly?
Explain the conditions which make it possible, profitable and desirable?
Q.3 Explain transfer pricing with a perfectly competitive imperfectly competitive
external market.
Q.4 Explain transfer pricing when there is no external market.
Q5. Write short note on
Cost plus Pricing
Incremental Pricing
Unit 5- Failure
Q.1 What is market failure? What are some of the causes of market failure.
Q.2 Write short note on asymmetric information.
Unit 6 National Income Accounting
Q.1. Define National income. What are the various methods of estimating national
income?
Q.2 Explain the concepts of Gross National Product, Gross Domestic product and net
national product at market prices
Q.4 Write short notes on – concept of GDP and NNP
Q.5 What do you understand by Multiplier? Explain leakages of multiplier.
Q.6 Discuss Inflation its types and causes. What are the measures to control inflation?
Q.7 Write short note on Deflation.
Unit7 Macro Economic Policy
Q.1 Discuss the objectives and tools of monetary policy.
Or
Discuss the various credit control methods of monetary policy.
Q.2 What is the role and tools of fiscal policy in mobilization of resources.
Q.3 “Monetary policy can check a boom, but it is difficult to deal with recession.”Discuss
Q.5 What should be the role of Monetary policy in a developing economy? Also give its
limitations.
Q.6 Discuss the objectives and tools of fiscal policy.
Q.7 What should be the role of Fiscal policy in a developing economy? Also give its
limitations.
Unit 8 Business Cycle
Q.1 What are the phases of business cycle? Explain its characteristics and different
stages.
Q.2 Elaborate its various stages with suitable examples.
Q.3 Discuss the effects of business cycle and the various tools to control it.
Or
What are the appropriate monetary and fiscal policies for boom and depression?
Q.4 Discuss the steps a businessman may take to safeguard himself against the evil
effects of business cycle.
Q.5 Are cyclical fluctuations necessary for economic growth? Suggest appropriate fiscal
and monetary policies for depression.
Unit 9 International Trade
Q.1 Explain balance of payment. Indicate various items in the balance of payment of a
country.
Q2. Discuss the need and importance of International trade. Explain the advantages of
flexible exchange rates.
Q.3 Analyze causes of adverse balance of payments.
Q.4 Write short notes on
Difference between fixed exchange rate and flexible exchange rate
Convertibility of rupee
Balance of payment – methods top correct Disequilibria
Q.5. What do you understand by equilibrium in the balance of payments? Explain the
conditions necessary for such equilibrium.
Unit 10 Economic Environment of Business
Q.1 Write a short note on the current scenario of Indian economy.
Q.2 Discuss micro and macro economic factors which affect business.