Ques 1.

Explain the features of a monopoly market structure. What are the characteristics of a natural monopoly?

Ques 2.

How does a monopolist decide its profit maximising output? Explain with the help of appropriate diagram.

Ques 3.

Consider a duopoly of firm 1 and 2 producing a homogenous product, the demand of which is described by the following demand function: Q = 1/2(100 – P) Where Q is total production of both firms (i.e., Q = Q1 +Q2) marginal cost of production faced by both firms be Rs. 40, i.e.M = M = 20. Calculate the residual demand function for both the firms. Using them ascertain their reaction curves and the Cournot-Nash equilibrium quantity produced by each firm?

Ques 4.

Discuss the dominant strategy and dominated strategy in a game through an example. Is Nash equilibrium always indicated dominant strategy? Why or why not? Explain.

Ques 5.

Consider a monopolist facing an inverse demand function P(Q) = 10 – Q, and total cost function 2Q + Q 2 . Calculate the deadweight loss associated with this market condition.

Ques 6.

What do you understand by the term ‘adverse selection’? Discuss with the reference to market for lemons.

Ques 7.

Explain the concept of contract curve by showing efficiency in production. How is pareto optimality related to the contract curve? Discuss.

Ques 8.

Bring out the difference between the general equilibrium analysis and partial equilibrium analysis.

Ques 9.

What are the inefficiencies related to a positive externality? Explain with the help of a diagram.

Ques 10.

Explain the concept of price discrimination with reference to first degree price discrimination.

Ques 11.

Distinguish between the classical utilitarian social welfare function and the minimax social welfare function.

Ques 12.

Differentiate between a sequential game and a simultaneous game with the help of examples.