- What is conjectural variation? Show how some models of oligopoly are derived on the basis of it.
- Suppose that we have only two firms in a market with constant marginal costs of C1 and C2 respectively such that C1>C2. What is Bertrand equilibrium in this market? How is it different from competitive equilibrium?
- Many countries subsidize some of their export industries use a partial equilibrium model under perfect competition to illustrate the following effects of an export subsidy for a large country:
- Welfare Effects of an export subsidy.
- Which group is winning and which is losing from the subsidy.
- Briefly state the Kaldor’s Theory of Distribution in determining the share of profit and share of wages in national income. Explain the mechanism behind Kaldor’s model.
- State arrows five reasonable conditions which a social welfare function must satisfy.
- Indian economy with only two commodities, two consumers and two producers with single factor of production, derive the necessary conditions of Pareto optimality in a perfect economy.
- Two firms produce homogenous outputs with cost functions C1= 𝑞2 , C2= 2𝑞2 and the inverse market demand function P= 100- (q1+q2). Show that at the Cournot Nash equilibrium firm 2 make higher profit than at the joint profit maximizing equal. Explain why this is so.
- Under competition, the cost function is given as C(y) = y2 + 1, where y is output. Derive the inverse supply curve and show how the supply curve looks like.
- What determines the degree of price discrimination under monopoly market?
- ‘Tragedy of commons’ leads to over-exploitation of resources. Analyse.
- The role of income and substitution effect is crucial in producing backward bending labour supply curve when a tax is imposed on wages, Do you agree?
- Reflect on the inefficiency and socially undesirable aspects of monopolistic competition market situation vis-à-vis the perfect competition, both in the short and in the long run.
- What is the follower’s problem in a duopoly model and how does it differ from the leader’s problem?
- What criteria will have to be satisfied to obtain a Pareto efficient allocation?
- How is the Marshallian equilibrium different from Walrasian equilibrium?
- What are the causes of market failure in agriculture? How may government intervention mitigate this?
- Does a monopolistically competitive market lead to excess capacity under price competition?
- Explain some of the measures for assessing the monopoly power of a firm.
- Explain why in a duopoly model of collusion, each firm has an incentive to cheat the other.
- Show how a dominant firm with a competitive fringe can act as a price leader in an oligopoly market.
- Give an outline of Kaldor’s theory of distribution. Also explain the implications of an increase in the wage level and a reduction in the saving rate on the distribution of income.
- How do externalities lead to market failure? How can this situation be remedied?
- Derive the expansion path for a firm operating with the Cobb-Doughlas production function.
- “Under monopolistic competition of a firm enjoys Monopoly power without enjoying Monopoly profit.” – Explain.
- “Pareto Optimality conditions are necessary but not sufficient conditions for social welfare maximization.” Comment.
- How Chamberlin uses planned sales curve to explain equilibrium of a firm and group when the entry of firms is permitted?
- State and discuss Arrow impossibility theorem. How does Sen modify it for social welfare maximization?
- State Marshallian and Walrasian stability condition of market equilibrium. Do you think that existence of Marshallian stability necessarily ensures Walrasian stability and vice versa? Explain.
- State Bain’s limit price theory.
- Explain kinked demand curve theory with the help of diagram.
- Examine Kaldor and Kalecki theory of distribution.
- Write on Prisoners’ dilemma and Nash equilibrium.
- What is a Lemon Market? What is the role of signalling and screening in it? Explain.
- What is asymmetric information? How could it lead to adverse selection and market failure? Discuss.
- Explain Brander-Krugman model of intra-industry trade in an oligopolistic market.
- Explain the backward sloping supply curve of labour as a choice between income and leisure.
- Under perfect competition, in the short run, find out graphically, without using average cost curve, the conditions in equilibrium for the existence of
- normal profits
- supernormal profit and
In what way Kaldor’s model of income distribution is basically a Keynesian theory?
- Explain how Nash equilibrium provides a solution to the problem of strategicinterdependence among firms in an oligopolistic market.
- How is Kaldor-Hicks compensation principle an improvement over Pareto optimality criterion? What are Scitovsky’s views in this regard?