KENYA METHODIST UNIVERSITY
FACULTY OF SCIENCE AND TECHNOLOGY
DEPARTMENT OF AGRICULTURE
DLM ASSIGNMENT
Trimester
Course code
Course Title
Date Due
Instructor
Cell phone
Email
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FIRST TRIMESTER 2016
AGEC 111
AGRICULTURAL ECONOMICS
26 TH MARCH
MARTIN KOOME
0721215351
INSTRUCTIONS:
1. Answer ALL questions.
2. Your work should be TYPED in New Times Roman-font size 12 and 1.5 spacing.
3. All your citations should be properly identified (inside the text)
4. Ensure your write-up contains the necessary details: - Name of the University,
department, your identification (Name & Reg. No.), course code, course title, and the
name of the lecturer as indicated on the assignments.
5. LATE Assignment will NOT be MARKED
6. ALL Assignments should go through the ODLM office.
Answer all questions
Question One
a. Define agricultural economics and list any three fundamental
questions of economic organization. (5 Marks)
b. State the law of supply and state four determinants of supply. (5
Marks)
c. Explain the meaning of a free market economy and outline three
characteristics of such an economy. (5 Marks)
d. Explain the meaning of the term ‘ceteris paribus’ as used in
economics and state why it is used in most economic laws. (5
marks)
Page 1 of 4
e. With the help of a labeled graph express the relationship between
Total Cost (TC), Total Variable Cost (TVC) and Total Fixed Cost
(TFC)
(5 Marks)
f. Explain the meaning of Gross National Product (GDP) and state
at least three uses of the same.
(5 Marks)
g. Define inflation and state four effects of inflation on the functions
of money.
(5 Marks)
h. Highlight five causes of unemployment in developing countries.
(5 Marks)
Question Two
Explain the concept of consumer sovereignity and its limitations.
(10 marks)
Question Three
Define and explain the characteristics of
i) Perfect competition
(5 Marks)
ii) Monopolistic competition
(5 Marks)
Question Four
a. Explain the meaning of a production function and from the
hypothetical illustration below.
(3 Marks)
b. Calculate average product of labor.
(2 Marks)
c. Calculate marginal product of labor.
(2 Marks)
d. Graphically represent the total product (TP) average product (AP),
marginal product (MP). (3 marks)
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e. Show the three stages of production and state the most rational
stage of production. (2 Marks)
f. State the meaning of the law derived from this illustration. (3
Marks)
Land Labor
Total
Average Product Marginal Product
X
Product Y
(AP)
1
0
0
1
1
3
1
2
8
1
3
12
1
4
15
1
5
17
1
6
17
1
7
16
1
8
13
(MP)
Question five
a) What are likely to be the effects of increased technological change on
employment?
b) Why should demographic analyses and information be of interest to
Kenyan planners?
c) Discuss the problems and opportunities which rapid population
growth poses for the economy of Kenya
Question six
“Unemployment is one of the major economic problems facing most
developing countries”. Explain the major causes and suggest some possible
Page 3 of 4
economic policies that these countries could adopt and implement in order
to reduce it. (10 mks)
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