LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034  M.A. DEGREE EXAMINATION – ECONOMICS

AN 17

FIRST SEMESTER – NOV 2006

         EC 1806 – MICRO ECONOMICS – I

(Also equivalent to EC 1803/1800)

 

 

Date & Time : 26-10-2006/1.00-4.00           Dept. No.                                                       Max. : 100 Marks

Part  – A

 

Answer any FIVE questions in about 75 words each.                  (5 x 4 = 20 marks)

1. Explain the steps involved in Inductive method.
2. Differentiate micro dynamic analysis from macro dynamic analysis.
3. Define ‘”Introspective cardinalist” approach and “Behaviourist ordinalist approach”
4. Explain the nature of income effect and substitution effect with respect to normal and Giffen goods.
5. Bring out two differences between Friedman-Savage hypothesis and Markowitz hypothesis.
6. Differentiate Marginal Rate of Technical substitution from Marginal Rate of Substitution.
7. Differentiate production costs from selling costs in monopolistic competition.

 

Part – B

 

Answer any FOUR questions in about 300 words each.            (4 x 10 = 40 marks)

8. Do you support a blend of deduction and induction analysis to analyse modern economic issues? Why?
9. Do you share the view that the Revealed preference approach is a refinement over the Cardinal utility approach? Substantiate your reasons.
10. Compare monopoly market with monopolistic market.
11. Critically examine Cobb-Douglas production function. Do you think that it is applicable to modern industry? How?
12. Compare the concepts of Budget line, Indifference map and Indifference curve with Iso-cost line, Iso-quant and Iso-qunat map.
13. Enumerate the features of monopoly market? Is it applicable to modern economy?
14. Compare and contrast strong ordering and weak ordering of Hicks. How does he apply them to derive the demand curve?

Part – C

 

Answer any TWO questions in about 900 words each.              (2 x 20 = 40 marks)

15. Compare and contrast the interpretations of income effect, price effect and substitution effect from the point of view of Hicks and Slutzky. Explain them with appropriate diagrams.
16. What do you understand by N-M utility index? Elaborate the axioms of it and construct N-M utility index. How is it a deviation from the cardinal utility analysis?
17. Define Ridge lines and Expansion path. To what extent are these concepts helpful to attain an optimum combination of output and minimization of cost of a firm? Explain the concepts with appropriate diagrams.
18. What is product differentiation? What is the role of it in the determination of output and price under monopolistic competition?

 

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