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    HBC 2104 HBT 2104 HBC 2109 Introduction To Microeconomics

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    HBC 2104 HBT 2104 HBC 2109 Introduction To Microeconomics

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    HBC 2104 HBT 2104 HBC 2109 INTRODUCTION TO MICROECONOMICS

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    HBC 2104 HBT 2104 HBC 2109 Introduction To Microeconomics

    Uploaded by

    karanujohnkiarie
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    © All Rights Reserved
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    of 2

    W1-2-60-1-6

    JOMO KENYATTA UNIVERSITY OF AGRICULTURE AND TECHNOLOGY


    UNIVERSITY EXAMINATIONS 2016/2017
    FIRST YEAR FIRST SEMESTER EXAMINATION FOR THE DEGREE OF BACHELOR OF
    COMMERCE

    HBC 2104/ HBT 2104/ HBC 2109: INTRODUCTION TO MICROECONOMICS

    DATE: JULY, 2017 TIME: 2 HOURS

    INSTRUCTIONS: ANSWER QUESTION ONE IN SECTION A AND


    ANY OTHER TWO QUESTIONS IN SECTION B

    QUESTION ONE: 30 MARKS

    a. Write short notes on the following terms:- (5 marks)

    i. Utility

    ii. Opportunity cost

    iii. Scarcity

    iv. Wants

    v. Choice

    b. Distinguish between change in quantity supply and change in supply.


    (4 marks)

    c. Explain the law of finishing returns. (2 marks)

    d. Discuss the relationship between the average and marginal revenue under
    this ? competition . (5 marks)

    e. With the aid of a well labeled diagram distinguish between pure floor and
    ceiling pure and explain the consequences of each. (12 marks)

    f. Outline and explain this factor of protection. (4 marks)


    1
    QUESTION TWO: 20 MARKS

    The table below shows the demand and supply schedule of a product

    Price (sh. Per kg) Demand Supply


    (kg) (kg)
    10 100 20
    20 85 36
    30 70 53
    40 55 70
    50 40 87
    60 25 103
    70 10 120

    Required :

    a. Plot the graph and determine the equilibrium price and quantity
    demanded/supplies. (10 marks)

    b. What are the demerits of the price fixed above the equilibrium price in (a)
    above? (4 marks)

    c. What are the demerits of fixing the price below the equilibrium price in (a)
    (6 marks)

    QUESTION THREE: 20 MARKS

    a. With the aid of a diagram distinguish between point electricity and Ark
    electricity. (6 marks)

    b. To maximize profit a perfectly competitive firm should produce at the level


    of output at which the marginal cost (MC) is equal to price. Discuss
    (14 marks)

    QUESTION FOUR: 20 MARKS

    a. Explain various economic systems citing advantages and disadvantages of


    each. (8 marks)

    b. Explain the determinants of the supply and demand for the factor of
    production. (12 marks)
    2

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