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Question:
(a) As an advisor to government as well as that to a firm how will you make use of your knowledge on price elasticity of demand, income elasticity and cross price elasticity?
(b) Deadweight losses are associated only in the case of monopoly. Discuss.
(c) Distinguish among the various types of barriers that can exist under imperfect market structures.
(d) Oligopoly is always characterized by price stickyness, irrespective of whether it is a cooperative or competing one. Discuss.
PROBLEMS OF USING PER CAPITA INCOME TO COMPARE STANDARD OF LIVING OVER TIME 1) The composition of output may change. e.g. more defence-related goods may be produced and
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diagram of a perfect competition
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The production function of a small shop that frames pictures is Q = 5 √ LK where Q is the number of pictures framed per day, L is labor hours and K is the machine hours.
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