Commerce (English Medium) Class 12 - CBSE Question Bank Solutions

Write down some of the limitations of using GDP as an index of welfare of a country.

Can there be some fixed cost in the long run? If not, why?

Answer the following question.
In the given diagram, OP is the market-determined price, and OP₁ is the price fixed by the government.

Answer the following question.
Gross Domestic Product (GDP) Does Not Give Us a Clear Indication of Economic Welfare of a Country. "Defend Or Refute the Given Statement with Valid Reason.

Answer the following question.
Define Price Floor. State the likely consequence of this type of intervention by the government.

Do you agree with the given statement? Give valid reasons in support of your answer.

"Higher Gross Domestic Product (GDP) means greater per capita availability of goods in the economy."

Explain how ‘Non-Monetary Exchanges’ impact the use of Gross Domestic Product as an index of economic welfare.

Discuss briefly the concept of 'Externalities', with suitable example.

"Many goods and services which may contribute to welfare, but are not included in estimating Gross Domestic Product (GDP)."

Do you agree with the given statement? Give valid reason in support of your answer.

State the meanings of the following:

Externalities

Define variable cost.

Give two examples of variable costs.

Define variable cost.

What conditions must hold if a profit-maximizing firm produces positive output in a competitive market?

Can there be a positive level of output that a profit-maximising firm produces in a competitive market at which market price is not equal to marginal cost? Give an explanation.

Will a profit-maximising firm in a competitive market ever produce a positive level of output in the range where the marginal cost is falling? Give an explanation.

Will a profit-maximising firm in a competitive market produce a positive level of output in the short run if the market price is less than the minimum of AVC?

Will a profit-maximising firm in a competitive market produce a positive level of output in the long run if the market price is less than the minimum of AC? Give an explanation.

The following table shows the total revenue and total cost schedules of a competitive firm. Calculate the profit at each output level. Determine also the market price of the good.

The following table shows the total cost schedule of a competitive firm. It is given that the price of the good is Rs 10. Calculate the profit at each output level. Find the profit maximising the level of output.