Correct Answer: D. give protection to bank depositors

Correct Answer: A. there are many buyers and few sellers

Correct Answer: B. X and Y are produced by the same firm

Correct Answer: D. adding up the total variable cost and total fixed cost

Correct Answer: B) AP equals MP when MP is at the Maximum

Explanation

This Economics question is about Total Product (TP), Marginal Product (MP), and Average Product (AP). The question asks you to identify which statement among the options is not true about TP, MP, and AP.

Option A states that when TP is at its maximum, MP equals zero. This is true because MP is the additional output produced when one more unit of input is added, and when TP is at its maximum, it means that the input added is no longer increasing the output, hence MP equals zero.

Option B states that AP equals MP when MP is at the maximum. This statement is incorrect because when MP is at its maximum, AP is neither at its maximum nor equal to MP. AP is the total output divided by the total input, while MP is the additional output when a unit of input is added.

Option C states that when TP is falling, MP is negative. This is true because when TP is falling, it means that the additional input is causing a decrease in output, hence MP is negative.

Option D states that when TP is at the maximum, AP is positive. This is true because AP is the total output divided by the total input, hence if TP is at its maximum, it means that the output is greater than the input, hence AP is positive.

Therefore, the correct answer is Option B, which states that AP equals MP when MP is at the maximum. This statement is incorrect because when MP is at its maximum, AP is neither at its maximum nor equal to MP.

Correct Answer: B. falling

Explanation

(i) Excessive pressure on the resources of the working population

(ii) Reduction of saving and Investment

(iii) Low national Income and reduced standard of living

(iv) Shortage of goods and services i.e excess demand

(v) Reduced tax revenue and therefore the possibility of Increased national debt

(vi) Retards economic growth and development (vii) Reduced efficiency and low productivity.

(viii) High level of Imports,

(ix) High taxation

(x) Increased government expenditure

(xi) Low exports

(xii) Increased cost of living

(xii) Increased demand for commodities consumed by the young and the aged

Explanation

(a) The Differences between monopoly and perfect competition are:

(i) Monopoly is a single firm in the industry while perfect competition is made up of many firms in the industry

(ii) Entry is blocked under monopoly while entry is free in perfect competition.

(iii) Different prices rule the market under monopoly while the price is fixed in a perfect competition

(iv) The demand curve under monopoly is downward sloping while that of perfect competition Is perfectly elastic (remains the same at all levels of output).

(v) The products are heterogeneous under monopoly while they are homogeneous in a perfect competition.

(vi) customers are treated differently under monopoly while

(vii) There is perfect knowledge in perfect competition whereas in monopoly knowledge is limited. e.g. price discrimination.

(viii)Transport cost is excluded in the price under perfect competition and included under monopoly.

(ix) Monopoly can make abnormal profits in the short and the long run while perfect competition can make abnormal profit only in the short run.

(b) Barriers that can prevent the emergence of competitive firms

(i) High entry costs: Existing monopolies producing large volume of output may be benefiting from economies of scale. This may mean that new competitors, probably producing low volume of output, would be faced with higher per unit cost and so would not be able to compete effectively In the market.

(ii) Legal monopolies: Created by law e.g. public utilities like the Post office

(iii) Patent and copyrights: Patent on an invention or innovation. A patent confers sole production rights for a given time period on those who have invested in research and development to enable them to earn a return on their investment. A copyright restricts the production of printed or recorded materials in a similar way.

(iv) Ownership of natural resources: Sole owners of natural resources e g OPEC countries and crude oil.

(v) Unfair Competition: Rivals may be eliminated and the entry of new competitors blocked by aggressive tactics. Example price wars

(vi) Possession of a rare skill I knowledge.

(a) The Differences between monopoly and perfect competition are:

(i) Monopoly is a single firm in the industry while perfect competition is made up of many firms in the industry

(ii) Entry is blocked under monopoly while entry is free in perfect competition.

(iii) Different prices rule the market under monopoly while the price is fixed in a perfect competition

(iv) The demand curve under monopoly is downward sloping while that of perfect competition Is perfectly elastic (remains the same at all levels of output).

(v) The products are heterogeneous under monopoly while they are homogeneous in a perfect competition.

(vi) customers are treated differently under monopoly while

(vii) There is perfect knowledge in perfect competition whereas in monopoly knowledge is limited. e.g. price discrimination.

(viii)Transport cost is excluded in the price under perfect competition and included under monopoly.

(ix) Monopoly can make abnormal profits in the short and the long run while perfect competition can make abnormal profit only in the short run.

(b) Barriers that can prevent the emergence of competitive firms

(i) High entry costs: Existing monopolies producing large volume of output may be benefiting from economies of scale. This may mean that new competitors, probably producing low volume of output, would be faced with higher per unit cost and so would not be able to compete effectively In the market.

(ii) Legal monopolies: Created by law e.g. public utilities like the Post office

(iii) Patent and copyrights: Patent on an invention or innovation. A patent confers sole production rights for a given time period on those who have invested in research and development to enable them to earn a return on their investment. A copyright restricts the production of printed or recorded materials in a similar way.

(iv) Ownership of natural resources: Sole owners of natural resources e g OPEC countries and crude oil.

(v) Unfair Competition: Rivals may be eliminated and the entry of new competitors blocked by aggressive tactics. Example price wars

(vi) Possession of a rare skill I knowledge.

Correct Answer: A) output may be increased by changing all factors by the same proportion

Explanation

In this Economics question, we are being asked to identify which statement is not applicable in the short run. The options given are Option A: output may be increased by changing all factors by the same proportion, Option B: diminishing returns, Option C: there are sunk costs, and Option D: the total cost curve is the same as the total variable cost curve.

The correct answer is Option A: output may be increased by changing all factors by the same proportion. This statement is not applicable in the short run because in the short run, at least one factor of production is fixed, which means it cannot be changed. Therefore, output cannot be increased by changing all factors by the same proportion.

Diminishing returns, Option B, is applicable in the short run. This refers to the fact that as more of a variable input is added to a fixed input, the marginal product of the variable input will eventually decrease.

Option C, sunk costs, is also applicable in the short run. Sunk costs are costs that have already been incurred and cannot be recovered, regardless of the decision that is made.

Option D, the total cost curve being the same as the total variable cost curve, is applicable in the short run. This is because in the short run, at least one factor of production is fixed and therefore the total cost curve cannot be the same as the total variable cost curve.

In summary, the statement that is not applicable in the short run is Option A, and this is because at least one factor of production is fixed in the short run and therefore output cannot be increased by changing all factors by the same proportion.

Correct Answer: B. wages rate