BCOG-171

BCOG-171 Principles of Microeconomics – Solved Assignment Answers (All Questions)

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Introduction This post compiles all the solved questions for the BCOG-171: Principles of Microeconomics assignment. Each answer is detailed and formatted according to IGNOU standards. Click on the links below to view individual answers. Section A (10 Marks Each) Explain the concept of a Production Possibility Curve… Explain the law of demand with the help […]

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Define functional distribution and distinguish it from personal distribution.

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Introduction Distribution of income is a core topic in economics that examines how a nation’s total income is divided among its citizens or factors of production. It can be studied in two main ways: functional distribution and personal distribution. These approaches focus on different aspects of income flow within an economy. Definition of Functional Distribution

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What is backward bending supply curve? Explain with an example.

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Introduction The backward bending supply curve is a unique concept in labor economics that illustrates how the quantity of labor supplied may decrease beyond a certain wage level. While typically supply increases with price, the labor market can show the opposite under specific conditions due to worker preferences for leisure versus income. Understanding the Backward

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How the various tools of government intervention are applied while determining the price?

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Introduction Governments intervene in markets to regulate prices, ensure fairness, and stabilize the economy. Price determination through purely market forces can lead to inequalities or market failures. Therefore, various tools of government intervention are employed to correct such outcomes and ensure efficient and equitable allocation of resources. Key Tools of Government Intervention in Price Determination

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Write a short note on the claimed superiority of indifference curves analysis over utility analysis.

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Introduction The debate between indifference curve analysis and utility analysis revolves around how consumer preferences and choices are understood in economics. Indifference curve analysis is widely considered superior due to its realism and flexibility compared to the earlier cardinal utility theory proposed by classical economists. Utility Analysis: An Overview Utility analysis assumes that utility can

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What is full-cost pricing principle? Does it lead to a higher than optimum production?

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Introduction The full-cost pricing principle, also known as cost-plus pricing, is a method where firms set the selling price of a product by adding a specific markup to the total cost of production. It is a widely used pricing strategy in practice, especially among monopolistic and oligopolistic firms. However, this approach raises questions regarding production

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What are the various sources of profits? Do you think that all profits can be explained in terms of the monopoly power exercised by the producer?

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Introduction Profit is the surplus remaining after all costs and expenses of running a business are deducted from its revenue. In economics, profit serves as a reward for entrepreneurship and risk-taking. However, the sources of profit are diverse and extend beyond just monopoly power. Understanding these sources provides insight into the dynamics of business success

What are the various sources of profits? Do you think that all profits can be explained in terms of the monopoly power exercised by the producer? Read More »

Distinguish between interest and profit. Is it not correct to say that both are earned by the capitalists for the capital they invest in the production process?

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Introduction Interest and profit are both forms of income derived from the use of capital in the production process. While they appear similar, they originate from different sources, serve different purposes, and are subject to different levels of risk. Understanding their distinction is vital to grasp the dynamics of income distribution in economics. Difference Between

Distinguish between interest and profit. Is it not correct to say that both are earned by the capitalists for the capital they invest in the production process? Read More »

Why should equilibrium between marginal cost and marginal revenue be a necessary condition for equilibrium of a firm?

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Introduction In microeconomic theory, the condition for the equilibrium of a firm is where Marginal Cost (MC) equals Marginal Revenue (MR). This is a fundamental principle in profit-maximization models for firms operating in any market structure. When this condition is met, the firm achieves optimal production—neither producing too much nor too little. Understanding the Concepts

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What are the characteristics that have to be considered while identifying a Market structure?

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Introduction The concept of market structure refers to the organizational and other characteristics of a market. It is a crucial aspect in microeconomics that determines the behavior of firms within the market, the level of competition, and ultimately how prices and outputs are decided. Identifying the type of market structure helps in understanding how businesses

What are the characteristics that have to be considered while identifying a Market structure? Read More »

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