Q.

1 02 Marks Question

Chapter 1: Managerial Economics

1. Define microeconomics and macroeconomics.

2. What is Managerial Economics? Mention its nature.
3. Explain the concept of "firm" in economics.
4. State the profit maximization model of a firm.
5. What is Marris’ Growth Maximisation Model?
6. Mention any two objectives of a firm.
7. How does Managerial Economics assist in decision-making?
8. What is the Cyert and March Behavior Theory?
9. Define - Wealth Maximization
10. Accounting Costs and Economic costs

Chapter 2: Utility & Demand Analysis

1. Define the law of diminishing marginal utility.

2. What is an indifference curve?
3. Explain the concept of consumer surplus.
4. What is elasticity of demand? Mention its types.
5. Define the law of demand and state two exceptions.
6. What are the determinants of demand?
7. What is demand forecasting?
8. Mention two survey methods used for demand forecasting.
9. Define utility and its measurement.
10. What is a budget line?
11. Give formula of Price elasticity of demand
12.

Chapter 3: Supply & Market Equilibrium

1. Define the law of supply.

2. What are the factors determining elasticity of supply?
3. Explain the concept of market equilibrium.
4. What is the relationship between cost and production?
5. Differentiate between accounting costs and economic costs.
6. What are economies of scale?
7. What is the significance of shifts in supply?
 8. Define the cost-output relationship in the short run.

Chapter 4: Revenue Analysis and Pricing Policies

1. Define revenue and mention its types.

2. What is price elasticity of demand?
3. Explain cost-plus pricing with an example.
4. What is price skimming?
5. Define marginal cost pricing.
6. What is meant by price discrimination under monopoly?
7. Explain the concept of break-even analysis.
8. What are the features of perfect competition?
9. What is collusive oligopoly?
10. Define Penetration Pricing
11. Why is government intervention needed in markets?

Chapter 5: Consumption Function and Investment Function

1. Define the consumption function.

2. What is the marginal efficiency of capital?
3. Explain the multiplier effect in economics.
4. What is the accelerator principle?
5. Define business cycles and their main features.
6. Mention two theories of business cycles.
7. What measures can be taken to control business cycles?
8. Explain the relationship between business cycles and business decisions.

Q.1 True or False

Chapter 1: Managerial Economics

1. Microeconomics focuses on individual consumers and firms. (True)

2. The primary objective of every firm is always profit maximization. (False)
3. Managerial economics does not involve decision-making. (False)
4. Marris’ Growth Maximization Model emphasizes the balanced growth of sales and profits.
(True)
5. The Cyert and March Behavioral Theory focuses on satisfying the aspirations of stakeholders.
(True)

Chapter 2: Utility & Demand Analysis

 1. The law of diminishing marginal utility states that the additional satisfaction from consuming
each extra unit decreases. (True)
2. An indifference curve represents all combinations of goods providing different levels of
satisfaction. (False)
3. Consumer surplus is the difference between what a consumer is willing to pay and what they
actually pay. (True)
4. Elasticity of demand measures how much the demand for a product changes with price
changes. (True)
5. Demand forecasting is only applicable to established products, not new products. (False)

Chapter 3: Supply & Market Equilibrium

1. The law of supply states that supply increases as price decreases, all else being equal. (False)
2. Elasticity of supply measures the responsiveness of supply to changes in price. (True)
3. Market equilibrium occurs when supply exceeds demand. (False)
4. Short-run costs are fixed, while long-run costs vary with output levels. (False)
5. Economies of scale lead to a decrease in per-unit production costs as output increases.
(True)

Chapter 4: Revenue Analysis and Pricing Policies

1. Revenue is independent of price elasticity of demand. (False)

2. Price skimming is a pricing strategy used to attract price-sensitive customers. (False)
3. Marginal cost pricing focuses on covering variable costs and contributes to profit. (True)
4. Perfect competition results in firms being price takers. (True)
5. Monopolistic competition involves significant product differentiation. (True)

Chapter 5: Consumption Function and Investment Function

1. The consumption function shows the relationship between income and consumption. (True)
2. The multiplier effect explains how an increase in investment leads to a smaller increase in
income. (False)
3. The accelerator principle states that investment depends on the rate of change in income or
output. (True)
4. Business cycles are regular, predictable fluctuations in economic activity. (False)
5. Government intervention is unnecessary in controlling business cycles. (False)
Filing the blanks

Chapter 1: Managerial Economics

1. __________ economics studies individual units like consumers and firms. (Micro)
2. The __________ model emphasizes balanced growth of sales and profits. (Marris’ Growth
Maximization)
3. Managerial Economics bridges the gap between economic theory and __________. (business
decision-making)
4. __________ theory focuses on satisfying the goals of stakeholders and individuals within a
firm. (Cyert and March Behavioral)
5. The __________ objective of a firm assumes that the sole aim is to maximize profits.
(traditional)

Chapter 2: Utility & Demand Analysis

1. The law of __________ states that the additional satisfaction from consuming extra units of
a good decreases. (diminishing marginal utility)
2. An __________ curve represents all combinations of goods that provide equal satisfaction.
(indifference)
3. __________ is the difference between what a consumer is willing to pay and what they
actually pay. (Consumer surplus)
4. The responsiveness of quantity demanded to a change in price is called __________.
(elasticity of demand)
5. __________ forecasting helps predict future demand for a product. (Demand)

Chapter 3: Supply & Market Equilibrium

1. The law of __________ states that supply increases with an increase in price, all else being
equal. (supply)
2. __________ of supply measures how responsive supply is to changes in price. (Elasticity)
3. A state where demand equals supply is known as __________. (market equilibrium)
4. __________ costs vary with production levels, while fixed costs do not. (Variable)
5. __________ of scale occurs when increasing production reduces per-unit costs. (Economies)

Chapter 4: Revenue Analysis and Pricing Policies

1. __________ pricing focuses on covering variable costs and contributing to profit. (Marginal
cost)
2. __________ competition is characterized by many sellers offering identical products.
(Perfect)
3. Price __________ occurs when different prices are charged for the same product to
different consumers. (discrimination)
 4. A __________ analysis is used to determine the point at which total revenue equals total
cost. (break-even)
5. __________ pricing is a strategy used to penetrate markets by setting lower prices.
(Penetration)

Chapter 5: Consumption Function and Investment Function

1. The __________ function shows the relationship between income and consumption.
(consumption)
2. The __________ effect explains how an initial increase in investment can lead to a multiplied
increase in income. (multiplier)
3. The __________ principle suggests that investment depends on changes in income or
output. (accelerator)
4. __________ cycles are fluctuations in economic activity over time. (Business)
5. Government uses __________ to stabilize markets and control monopolies. (intervention)

Q.2 05 Marks Question

Chapter 1: Managerial Economics

1. Explain the difference between microeconomics and macroeconomics with examples.

2. Describe the objectives of a firm according to Baumol’s Static and Dynamic Models.
3. Discuss the scope and significance of managerial economics in business decision-making.
4. Compare and contrast Marris’ Growth Maximization Model and Williamson’s Managerial
Discretionary Theory.
5. Explain the Cyert and March's Behavioral Theory of the firm

Chapter 2: Utility & Demand Analysis

1. Explain the concept of diminishing marginal utility with a diagram and example.
2. Discuss the significance of indifference curves in understanding consumer behavior.
3. What are the determinants of demand? Explain their role in demand forecasting.
4. Describe the methods of demand forecasting. Highlight the importance of survey and
statistical methods.
5. Explain the concept of elasticity of demand. How is it useful for business decision-making?

Chapter 3: Supply & Market Equilibrium

1. Discuss the factors determining elasticity of supply and its practical importance.
2. Explain the law of supply and illustrate it with a diagram.
3. What is the significance of market equilibrium in economics? Discuss with examples.
4. Differentiate between short-run and long-run cost-output relationships.
 5. Explain the concept of economies of scale and how it impacts production and costs.

Chapter 4: Revenue Analysis and Pricing Policies

1. Explain the relationship between revenue and price elasticity of demand.

2. Describe the objectives of pricing policies with suitable examples.
3. Discuss price determination under perfect competition in the short-run and long-run.
4. What is price discrimination? Explain its types with examples.
5. Explain the concept of break-even analysis and its application in profit forecasting.

Chapter 5: Consumption Function and Investment Function

1. Explain the concept of the consumption function and its significance in economics.
2. What is the multiplier effect? Illustrate its impact on economic activities with an example.
3. Discuss the accelerator principle and its relationship with investment decisions.
4. Describe the key features of business cycles and their impact on business decisions.
5. What measures can be taken to control business cycles? Discuss with examples.
Q.3. 10-mark question bank based on Applying Bloom's Taxonomy

Chapter 1: Managerial Economics

1. Explain the significance of Managerial Economics in business decision-making.

Discuss how it applies microeconomic principles to solve managerial problems in
firms.
2. Using the Profit Maximization model, explain how firms in perfect competition
maximize their profits. Compare it with the models of Cyert and March's
Behavior Theory and Marris' Growth Maximization.
3. Discuss the application of Managerial Economics in understanding the behavior
of firms. How do managers utilize economic theories like the theory of the firm,
cost functions, and market structures in decision-making?

Chapter 2: Utility & Demand Analysis

4. Explain the concept of Utility and Demand from a managerial perspective.

Apply the law of diminishing marginal utility and elasticity of demand to real-
life consumer behavior.
5. Illustrate how firms use the concept of elasticity of demand to determine pricing
strategies. Apply the various types of elasticity (price, income, and cross
elasticity) to a product or service of your choice.
6. Discuss how demand forecasting methods such as statistical methods, qualitative
methods, and survey methods are used by businesses. Provide examples of how
these methods help in making informed business decisions.

Chapter 3: Supply & Market Equilibrium

7. Explain how supply and demand interact to determine market equilibrium.

Using a real-world example, illustrate how changes in supply or demand can
affect the equilibrium price and quantity.
8. Discuss the application of cost analysis in managerial decision-making. How do
businesses use cost-output relationships, economies of scale, and cost functions to
optimize production and profits?
9. Analyze the effects of government interventions such as price controls and
subsidies on market equilibrium. Provide a real-life example where such
interventions have been applied, and discuss their impact on the market.

Chapter 4: Revenue Analysis and Pricing Policies

10. Discuss how different pricing strategies such as cost-plus pricing, penetration
pricing, and price skimming are used in various industries. Apply these
 strategies to a specific industry and evaluate their effectiveness in achieving
business objectives.
11. Analyze the pricing under perfect and imperfect competition. Using examples
from the real world, compare how pricing decisions differ under monopoly,
monopolistic competition, and perfect competition.

Chapter 5: Consumption Function and Investment Function

13. Discuss the concept of the consumption function and its application in business
decision-making. How do businesses use this concept to predict consumer
spending and make strategic decisions on pricing and production?
14. Analyze how the investment function, including the multiplier and accelerator
effects, influences business decisions on capital investment. Provide a real-life
example of a business that has utilized these concepts for growth and expansion.
15. Explain the role of business cycles in shaping investment and consumption
decisions. Discuss how businesses anticipate and respond to business cycles to
optimize operations and profits.

Q. 4 10-mark question bank based on Analysing Bloom's Taxonomy

Chapter 1: Managerial Economics

1. Analyze the relationship between managerial economics and business decision-

making. How does the application of economic concepts such as profit
maximization, cost analysis, and market structures help managers make
informed decisions?
o (
2. Compare and analyze the different theories of the firm, such as the profit
maximization model, Cyert and March's behavior theory, and Marris’ growth
maximization model. How do these theories differ in their approach to
understanding firm behavior and decision-making?
3. Evaluate the impact of managerial economics on organizational decision-making.
How do different economic theories (e.g., Baumol’s Static Model, Cyert and
March’s Theory) shape the strategic decisions in a company?

Chapter 2: Utility & Demand Analysis

4. Analyze how the law of diminishing marginal utility impacts consumer choices in
the real world. Compare this with how firms use demand forecasting to predict
 future demand. How do businesses integrate these concepts in pricing and
marketing strategies?
5. Analyze the role of elasticity of demand in managerial decision-making. How do
businesses determine the price elasticity of their products, and what strategies do
they adopt based on this analysis? Compare how firms use elastic vs inelastic
demand to set prices.
6. Examine how various demand forecasting techniques, such as qualitative
methods, statistical methods, and surveys, can impact business operations.
Which method is most effective under different market conditions, and why?

Chapter 3: Supply & Market Equilibrium

7. Analyze the impact of supply shifts and demand shifts on market equilibrium.
Use a real-life example of a market (e.g., housing, technology, etc.) to
demonstrate how changes in supply or demand influence equilibrium price and
quantity.
8. Compare and analyze the various cost functions in production, such as private
costs, social costs, and economic costs. How do firms use these cost functions to
determine pricing, output levels, and production efficiency?
9. Analyze the different market structures (e.g., perfect competition, monopoly,
oligopoly) and their effects on pricing strategies. How do firms operating under
these different structures adjust their pricing and output decisions?

Chapter 4: Revenue Analysis and Pricing Policies

10. Examine the relationship between marginal cost pricing and the firm’s pricing
decisions. How do firms use the concept of marginal cost to set prices in different
competitive environments (e.g., monopoly vs perfect competition)?
11. Analyze the impact of price discrimination on consumer welfare and firm
profits. Compare different types of price discrimination (first, second, and third
degree) and analyze their impact on business pricing policies.
12. Evaluate the effectiveness of pricing strategies such as penetration pricing, price
skimming, and cyclical pricing in different market conditions. How do businesses
analyze market demand and competitive behavior to choose the most suitable
pricing strategy?

Chapter 5: Consumption Function and Investment Function

13. Analyze how the consumption function can be used by businesses to predict
consumer spending patterns. How do businesses use this analysis to adjust their
pricing, marketing, and production strategies?
14. Examine how the multiplier and accelerator effects influence business
investment decisions. How do firms use these economic concepts to evaluate the
 potential impact of changes in investment on the overall economy and their own
business growth?
15. Analyze how business cycles affect investment and consumption decisions. How
do businesses adjust their strategies during periods of economic expansion and
recession, and what role does economic forecasting play in these adjustments?

10-mark question bank based on Evaluating Bloom's Taxonomy

Chapter 1: Managerial Economics

1. Evaluate the role of Managerial Economics in formulating business strategies.

How does it help businesses to achieve long-term sustainability, and what are the
limitations of its application in real-world situations?

2. Evaluate the effectiveness of different theories of the firm (such as Profit

Maximization, Cyert and March’s Behavioral Theory, and Marris’ Growth
Maximization Model) in explaining the objectives of firms. Which theory do you
believe best explains real-world firm behavior and why?

Chapter 2: Utility & Demand Analysis

3. Evaluate the impact of the law of demand and the law of diminishing marginal
utility on business pricing and marketing strategies. How do businesses use these
concepts to maximize profit while ensuring consumer satisfaction?
4. Evaluate the methods of demand forecasting, such as statistical methods and
surveys. Which method would be most suitable for a new product launch in a
competitive market, and why?

Chapter 3: Supply & Market Equilibrium

5. Evaluate the effects of government intervention (e.g., price controls, subsidies,

and tariffs) on market equilibrium. How do these interventions affect firms'
pricing and production decisions?
6. Evaluate how firms can use supply-side economics to achieve efficiency and
profitability. What are the limitations of relying on supply-side measures, such
as tax cuts or deregulation, in the long term?

Chapter 4: Revenue Analysis and Pricing Policies

 7. Evaluate the various pricing strategies, such as penetration pricing, price
skimming, and marginal cost pricing. Which strategy would be most effective for
a firm entering a competitive market, and why?
8. Evaluate the concept of price discrimination under monopoly. How does price
discrimination affect consumer welfare and firm profits? Discuss the ethical
implications of this pricing strategy.

Chapter 5: Consumption Function and Investment Function

9. Evaluate the relationship between consumption and investment in driving

economic growth. How do changes in these two factors influence business cycles
and decision-making in firms?
10. Evaluate the role of the multiplier and accelerator effects in business decision-
making. How can firms use these concepts to anticipate changes in the economy
and adjust their strategies accordingly?