Define flow variables.
Any variable whose magnitude is measured over a period of time is called a flow variable. For example, interest on bank loan, for 1 year, i.e. from April 01, 2008 to March 31, 2009 is a flow variable.
What is meant by producer's equilibrium? Explain the conditions of producer's equilibrium through the 'total revenue and total cost' approach. Use diagram.
Define 'Market-supply'. What is the effect on the supply of a good when Government imposes a tax on the production of that good? Explain.
Market for a good is in equilibrium. There is an 'increase' in demand for this good. Explain the chain of effects of this change. Use diagram.
Explain how the demand for a good is affected by the prices of its related goods. Give examples.
A consumer consumes only two goods X and Y. State and explain the conditions of consumer's equilibrium with the help of utility analysis.
What is a supply schedule? What is the effect on the supply of a good when Government gives a subsidy on the production of that good? Explain.
