Assessment Pattern Overview
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Questions and Answers

What is the total maximum marks for the Continuous Assessment Tests (CAT)?

  • 40 Marks (correct)
  • 30 Marks
  • 20 Marks
  • 60 Marks

    • How many sub-questions must students answer in the Objective questions section of the Internal Class Test?

  • 6 sub-questions
  • 10 sub-questions (correct)
  • 8 sub-questions
  • 12 sub-questions

    • What is the minimum percentage required to pass in both Internal and External assessments?

  • 50%
  • 60%
  • 30%
  • 40% (correct)

    • How many questions must be attempted in question number 2 of the External examination?

    <p>2 questions</p> Signup and view all the answers

    What is the maximum duration for the Internal Class Test?

    <p>40 minutes</p> Signup and view all the answers

    Which type of assessment contributes 20 marks through presentations?

    <p>CAT 3</p> Signup and view all the answers

    What is the marks distribution for the Concept-based short questions in the Internal Class Test?

    <p>4 Marks</p> Signup and view all the answers

    In the External examination, how many sub-questions are to be answered in the section with Answer in One/Two sentences?

    <p>3 sub-questions</p> Signup and view all the answers

    What does profit maximization require in terms of marginal cost and marginal revenue?

    <p>MC must be equal to MR</p> Signup and view all the answers

    What does the intersection of the MC curve and MR curve indicate for a firm?

    <p>The firm is in a state of equilibrium</p> Signup and view all the answers

    In a situation where average revenue equals average cost, the firm experiences which of the following?

    <p>Normal profit</p> Signup and view all the answers

    What happens at the shutdown point for a firm under perfect competition?

    <p>The firm incurs maximum loss</p> Signup and view all the answers

    At which equilibrium output level is the average revenue less than the average cost but greater than the average variable cost?

    <p>OQ3</p> Signup and view all the answers

    Under homogeneous cost conditions, firms in perfect competition experience which condition?

    <p>Uniform profit conditions</p> Signup and view all the answers

    Which price level indicates the firm is earning super normal profit?

    <p>OP5</p> Signup and view all the answers

    What is the result when average revenue is equal to the average variable cost?

    <p>The firm reaches its shutdown point</p> Signup and view all the answers

    Which firm operates with the lowest cost and makes supernormal profit?

    <p>Firm A</p> Signup and view all the answers

    What happens to the supply when firms earn supernormal profits in the short run?

    <p>Supply increases, leading to lower prices</p> Signup and view all the answers

    What is the condition for long-run equilibrium in terms of cost and revenue?

    <p>LMR = LMC = SMC = LAC = SAC = AR</p> Signup and view all the answers

    Which type of efficiency is achieved when a firm produces at the lowest average total cost?

    <p>Productive efficiency</p> Signup and view all the answers

    What is the result of loss-making firms exiting the industry?

    <p>Higher prices in the market</p> Signup and view all the answers

    What does it mean for a firm to reach technical efficiency?

    <p>Producing at the highest possible average product</p> Signup and view all the answers

    What equality signifies allocative efficiency?

    <p>Price equals marginal cost</p> Signup and view all the answers

    What will happen to the excess profits in the long run?

    <p>They will disappear</p> Signup and view all the answers

    What do production costs include?

    <p>Manufacturing and transportation expenses</p> Signup and view all the answers

    What is the primary purpose of selling costs?

    <p>To raise demand for a commodity</p> Signup and view all the answers

    Which of the following is NOT included in production costs?

    <p>Advertising costs</p> Signup and view all the answers

    According to E.H. Chamberlin, what role do production costs play?

    <p>They create utilities for consumer satisfaction</p> Signup and view all the answers

    Which statement distinguishes production costs from selling costs?

    <p>Production costs shift the supply curve while selling costs shift the demand curve.</p> Signup and view all the answers

    High rents would be classified under which of the following costs?

    <p>Production costs</p> Signup and view all the answers

    How do selling costs impact consumer behavior?

    <p>They encourage preference for specific products.</p> Signup and view all the answers

    What characterizes production costs compared to selling costs?

    <p>Production costs are mandatory expenses, while selling costs may be optional.</p> Signup and view all the answers

    What can result from firms using marginal cost pricing during a recession?

    <p>Cut-throat competition causing insufficient earnings to cover fixed costs</p> Signup and view all the answers

    In multi-product pricing, which factor is crucial in understanding how products relate to each other?

    <p>Demand relations and the nature of elasticity</p> Signup and view all the answers

    When a multi-product firm produces joint products, what pricing principle should be applied?

    <p>Total costs must be covered by the pricing of both main and byproducts together</p> Signup and view all the answers

    What influences pricing in a multi-product firm with products produced using common facilities?

    <p>The contribution of each product to fixed costs</p> Signup and view all the answers

    What is a characteristic of a firm operating like a discriminating monopolist in multi-product pricing?

    <p>It maximizes revenue by charging different prices based on demand elasticity</p> Signup and view all the answers

    In terms of transfer pricing, what is essential to evaluate divisional performance?

    <p>Assessing the optimal output of each division and the firm as a whole</p> Signup and view all the answers

    What type of pricing strategy might a multi-product firm adopt when dealing with substitutes?

    <p>Mark-up pricing based on varying profit margins</p> Signup and view all the answers

    What is NOT a factor influencing multi-product pricing?

    <p>External economic factors influencing individual products</p> Signup and view all the answers

    Study Notes

    Assessment Pattern

    • Continuous Assessment Tests (CAT) contribute 40% of the final grade.
    • Semester End Examination contributes 60% of the final grade.
    • Three CATs are conducted, each worth 20 marks.
    • The SEE is worth 60 marks and is conducted externally
    • Passing Criteria: Minimum 40% in the Internal (16 out of 40) and 40% in the External (24 out of 60) are required to pass the subject.

    Internal Class Test (CAT)

    • Maximum marks: 20
    • Duration: 40 minutes
    • Question structure:
      • Objective questions (MCQ, True or False or Fill in the blanks) - 10 marks (Students should answer 10 sub-questions out of 12 sub-questions)
      • Concept-based short questions (Meaning or definitions) - 4 marks (Students should answer 4 sub-questions out of 5 sub-questions)
      • Short notes - 6 marks (Students should answer 1 sub-question out of 3 sub-questions)

    External Examination

    • Maximum marks: 60
    • Duration: 2 Hours
    • Question structure:
      • Module I, II, III, IV - 12 marks
        • MCQ, True or False or Fill in the blanks - 6 marks (Students should answer 6 sub-questions out of 8 sub-questions)
        • Answer in One/Two sentences - 6 marks (Students should answer 3 sub-questions out of 4 sub-questions)
      • Modules I, II, III, IV - 12 marks each (Attempt any 2 questions out of 3 questions)

    Firm Equilibrium under Perfect Competition - Short Run

    • In the Short Run, firms operating under perfect competition with homogenous cost conditions can experience supernormal profits, normal profits, or losses.
    • Profit maximization requires that marginal cost (MC) equals marginal revenue (MR).
    • At the point of equilibrium, the MC curve intersects the MR curve from below.
    • The shut-down point occurs when average revenue equals average variable cost.

    Firm Equilibrium under Perfect Competition - Long Run

    • The long-run equilibrium of firms under perfect competition is considered stable.
    • Supernormal profits attract new firms, increasing supply and reducing prices, leading to normal profits in the long run.
    • Losses cause firms to exit the industry, reducing supply and increasing prices, resulting in normal profits in the long run.
    • Key factors in long-run equilibrium include: LMR=LMC=SMC=LAC= SAC=AR.
    • Long-run equilibrium promotes productive efficiency, technical efficiency, and allocative or Pareto efficiency.

    Production Costs vs. Selling Costs

    • Production costs are expenses directly related to producing and delivering a product to customers.
    • Selling costs are expenses incurred to create demand for a product.
    • Production costs shift the supply curve, while selling costs shift the demand curve.
    • Production costs create utility, while selling costs create demand.
    • Production costs are mandatory, while selling costs are discretionary.

    Marginal Cost Pricing

    • In recessionary conditions, firms using marginal cost pricing may lower prices to maintain business.
    • This can lead to cut-throat competition as firms reduce prices to match competitors, potentially causing losses for all firms.
    • Under increasing cost conditions, marginal cost pricing may result in a higher price, while under decreasing cost conditions, it may lead to a lower price.

    Multi-Product Pricing

    • Firms that produce more than one product must consider factors such as demand relations, production relations, and capacity relationships when setting prices.
    • Multi-product pricing is complex due to the interplay between multiple products and the factors influencing their demand and production.

    Transfer Pricing

    • Transfer pricing is the determination of prices for intermediate products sold between divisions within the same firm.
    • The goal is to determine the optimal output for each division and the firm as a whole for evaluating divisional performance and determining rewards.

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    Description

    This quiz covers the assessment pattern including the weighting of Continuous Assessment Tests (CAT) and Semester End Examination (SEE). It details the marking scheme, including how internal and external tests contribute to the final grade and the passing criteria students must meet.

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