ms3033_2026T1_ET_FN.pdf
Managerial Economics · End Term · Jan 2026 FN
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Questions and published explanations below are available without starting a test. Some questions may not have a published solution yet.
Question 2 NAT · 1.5 marks
The market for paper in southern region in the India is characterized by the following demand and
supply curves: QD = 160,000−2000P and QS = 40,000+2000P, where QD is the quantity demanded in
100-pound lots, QS is the quantity supplied in 100-pound lots, and P is the price per 100-pound lot.
Currently there is no attempt to regulate the dumping of effluent into streams and rivers by paper
mills. As a result, dumping is widespread. The Marginal External Cost (MEC) associated with the
production of paper is given by the curve MEC = 0.0006QS.
Based on the above data, answer the given subquestions.
Calculate the output of paper if it is produced under competitive conditions and no attempt is
made to monitor or regulate the dumping of effluent. Q = __________
A published solution is not available for this question yet.
Question 3 NAT · 1.5 marks
The market for paper in southern region in the India is characterized by the following demand and
supply curves: QD = 160,000−2000P and QS = 40,000+2000P, where QD is the quantity demanded in
100-pound lots, QS is the quantity supplied in 100-pound lots, and P is the price per 100-pound lot.
Currently there is no attempt to regulate the dumping of effluent into streams and rivers by paper
mills. As a result, dumping is widespread. The Marginal External Cost (MEC) associated with the
production of paper is given by the curve MEC = 0.0006QS.
Based on the above data, answer the given subquestions.
Calculate the Price of paper if it is produced under competitive conditions and no attempt is made
to monitor or regulate the dumping of effluent. P = ___________
A published solution is not available for this question yet.
Question 4 NAT · 1.5 marks
The market for paper in southern region in the India is characterized by the following demand and
supply curves: QD = 160,000−2000P and QS = 40,000+2000P, where QD is the quantity demanded in
100-pound lots, QS is the quantity supplied in 100-pound lots, and P is the price per 100-pound lot.
Currently there is no attempt to regulate the dumping of effluent into streams and rivers by paper
mills. As a result, dumping is widespread. The Marginal External Cost (MEC) associated with the
production of paper is given by the curve MEC = 0.0006QS.
Based on the above data, answer the given subquestions.
Determine the socially efficient price of the paper. P = ________
A published solution is not available for this question yet.
Question 5 NAT · 1.5 marks
The market for paper in southern region in the India is characterized by the following demand and
supply curves: QD = 160,000−2000P and QS = 40,000+2000P, where QD is the quantity demanded in
100-pound lots, QS is the quantity supplied in 100-pound lots, and P is the price per 100-pound lot.
Currently there is no attempt to regulate the dumping of effluent into streams and rivers by paper
mills. As a result, dumping is widespread. The Marginal External Cost (MEC) associated with the
production of paper is given by the curve MEC = 0.0006QS.
Based on the above data, answer the given subquestions.
Determine the socially efficient quantity of the paper. Q = _________
A published solution is not available for this question yet.
Question 6 MCQ · 1.0 marks
Bharat Airlines (BA) flies only one route: Delhi-Chennai. The demand for each flight is Q=600-2P.
BA’s total cost of running each flight includes a fixed cost of 20000 and a variable cost of 90 per
passenger.
Based on the above data, answer the given subquestions.
What is the profit maximizing price that BA will charge?
90
195
180
390
A published solution is not available for this question yet.
Question 7 MCQ · 1.0 marks
Bharat Airlines (BA) flies only one route: Delhi-Chennai. The demand for each flight is Q=600-2P.
BA’s total cost of running each flight includes a fixed cost of 20000 and a variable cost of 90 per
passenger.
Based on the above data, answer the given subquestions.
How many passengers will be on each flight in equilibrium?
210
300
420
250
A published solution is not available for this question yet.
Question 8 MCQ · 1.0 marks
Bharat Airlines (BA) flies only one route: Delhi-Chennai. The demand for each flight is Q=600-2P.
BA’s total cost of running each flight includes a fixed cost of 20000 and a variable cost of 90 per
passenger.
Based on the above data, answer the given subquestions.
What is BA’s profit for each flight?
2050
2000
22050
25000
A published solution is not available for this question yet.
Question 9 MCQ · 1.0 marks
Bharat Airlines (BA) flies only one route: Delhi-Chennai. The demand for each flight is Q=600-2P.
BA’s total cost of running each flight includes a fixed cost of 20000 and a variable cost of 90 per
passenger.
Based on the above data, answer the given subquestions.
Now, suppose BA realizes that the fixed costs per flight are in fact 25000 instead of 20000. It also
finds out that two different types of passengers fly to Chennai. Type A consists of business people
with a demand of QA=520-0.8P and type B consists of students with a demand of QB=240-0.4P. BA
decides to charge these two types different prices.
The market demand curve will have a kink at
P=240
P=520
P=625
P=600
A published solution is not available for this question yet.
Question 10 NAT · 1.0 marks
Bharat Airlines (BA) flies only one route: Delhi-Chennai. The demand for each flight is Q=600-2P.
BA’s total cost of running each flight includes a fixed cost of 20000 and a variable cost of 90 per
passenger.
Based on the above data, answer the given subquestions.
Now, suppose BA realizes that the fixed costs per flight are in fact 25000 instead of 20000. It also
finds out that two different types of passengers fly to Chennai. Type A consists of business people
with a demand of QA=520-0.8P and type B consists of students with a demand of QB=240-0.4P. BA
decides to charge these two types different prices.
The price that BA charge the students is PB= ________
A published solution is not available for this question yet.
Question 11 NAT · 1.0 marks
Bharat Airlines (BA) flies only one route: Delhi-Chennai. The demand for each flight is Q=600-2P.
BA’s total cost of running each flight includes a fixed cost of 20000 and a variable cost of 90 per
passenger.
Based on the above data, answer the given subquestions.
Now, suppose BA realizes that the fixed costs per flight are in fact 25000 instead of 20000. It also
finds out that two different types of passengers fly to Chennai. Type A consists of business people
with a demand of QA=520-0.8P and type B consists of students with a demand of QB=240-0.4P. BA
decides to charge these two types different prices.
The price that BA charge the business people is PA= __________
A published solution is not available for this question yet.
Question 12 NAT · 1.0 marks
Bharat Airlines (BA) flies only one route: Delhi-Chennai. The demand for each flight is Q=600-2P.
BA’s total cost of running each flight includes a fixed cost of 20000 and a variable cost of 90 per
passenger.
Based on the above data, answer the given subquestions.
Now, suppose BA realizes that the fixed costs per flight are in fact 25000 instead of 20000. It also
finds out that two different types of passengers fly to Chennai. Type A consists of business people
with a demand of QA=520-0.8P and type B consists of students with a demand of QB=240-0.4P. BA
decides to charge these two types different prices.
Profit maximizing quantity for both groups will be QA= ___________
A published solution is not available for this question yet.
Question 13 NAT · 1.0 marks
Bharat Airlines (BA) flies only one route: Delhi-Chennai. The demand for each flight is Q=600-2P.
BA’s total cost of running each flight includes a fixed cost of 20000 and a variable cost of 90 per
passenger.
Based on the above data, answer the given subquestions.
Now, suppose BA realizes that the fixed costs per flight are in fact 25000 instead of 20000. It also
finds out that two different types of passengers fly to Chennai. Type A consists of business people
with a demand of QA=520-0.8P and type B consists of students with a demand of QB=240-0.4P. BA
decides to charge these two types different prices.
Profit maximizing quantity for both groups will be QB= ______
A published solution is not available for this question yet.
Question 14 NAT · 1.0 marks
Bharat Airlines (BA) flies only one route: Delhi-Chennai. The demand for each flight is Q=600-2P.
BA’s total cost of running each flight includes a fixed cost of 20000 and a variable cost of 90 per
passenger.
Based on the above data, answer the given subquestions.
Now, suppose BA realizes that the fixed costs per flight are in fact 25000 instead of 20000. It also
finds out that two different types of passengers fly to Chennai. Type A consists of business people
with a demand of QA=520-0.8P and type B consists of students with a demand of QB=240-0.4P. BA
decides to charge these two types different prices.
The profit of BA for each flight will be = ________
A published solution is not available for this question yet.
Question 15 NAT · 1.0 marks
Bharat Airlines (BA) flies only one route: Delhi-Chennai. The demand for each flight is Q=600-2P.
BA’s total cost of running each flight includes a fixed cost of 20000 and a variable cost of 90 per
passenger.
Based on the above data, answer the given subquestions.
Now, suppose BA realizes that the fixed costs per flight are in fact 25000 instead of 20000. It also
finds out that two different types of passengers fly to Chennai. Type A consists of business people
with a demand of QA=520-0.8P and type B consists of students with a demand of QB=240-0.4P. BA
decides to charge these two types different prices.
What is the total consumer surplus? CStotal = _________
A published solution is not available for this question yet.
Question 16 NAT · 1.0 marks
The production function for a product is given by **q = 450KL**. If the price of capital is INR 30 per day
and the price of labour is INR 150 per day.
Based on the above data, answer the given subquestions.
What is the cost minimizing quantity of labour and capital respectively for producing 9000 units of
output? L\(^{*}\) = ________
A published solution is not available for this question yet.
Question 17 NAT · 1.0 marks
The production function for a product is given by **q = 450KL**. If the price of capital is INR 30 per day
and the price of labour is INR 150 per day.
Based on the above data, answer the given subquestions.
What is the cost minimizing quantity of labour and capital respectively for producing 9000 units of
output? K\(^{*}\) = __________
A published solution is not available for this question yet.
Question 18 NAT · 1.0 marks
The production function for a product is given by **q = 450KL**. If the price of capital is INR 30 per day
and the price of labour is INR 150 per day.
Based on the above data, answer the given subquestions.
What is the minimum cost of producing 9000 units of output in INR?
A published solution is not available for this question yet.
Question 19 SHORT_TEXT · 1.0 marks
Consider two investment opportunities in new products: gourmet marmite and gourmet honey.
People might either really like or really dislike the gourmet marmite, so it generates a payoff of
$0.5 with 30 percent probability, a payoff of $1 million with 40 percent probability and a payoff of
$1.5 million with 30 percent probability. The gourmet honey is less likely to either really turn
people off or really turn them on, so it has a payoff of $0.5 million with 20 percent probability, $1
million with 60 percent probability and $1.5 million with 20 percent probability.
Based on the above data, answer the given subquestions.
Expected value of first product is ___________
**NOTE:** Enter the exact answer without any extra space in the beginning or at the end.
A published solution is not available for this question yet.
Question 20 SHORT_TEXT · 1.0 marks
Consider two investment opportunities in new products: gourmet marmite and gourmet honey.
People might either really like or really dislike the gourmet marmite, so it generates a payoff of
$0.5 with 30 percent probability, a payoff of $1 million with 40 percent probability and a payoff of
$1.5 million with 30 percent probability. The gourmet honey is less likely to either really turn
people off or really turn them on, so it has a payoff of $0.5 million with 20 percent probability, $1
million with 60 percent probability and $1.5 million with 20 percent probability.
Based on the above data, answer the given subquestions.
Expected value of second product is _____________
**NOTE:** Enter the exact answer without any extra space in the beginning or at the end.
A published solution is not available for this question yet.
Question 21 MSQ · 2.0 marks
Consider two investment opportunities in new products: gourmet marmite and gourmet honey.
People might either really like or really dislike the gourmet marmite, so it generates a payoff of
$0.5 with 30 percent probability, a payoff of $1 million with 40 percent probability and a payoff of
$1.5 million with 30 percent probability. The gourmet honey is less likely to either really turn
people off or really turn them on, so it has a payoff of $0.5 million with 20 percent probability, $1
million with 60 percent probability and $1.5 million with 20 percent probability.
Based on the above data, answer the given subquestions.
Choose the correct alternative(s)
The second product is riskier than the first product
Second product has lower variance than the first product
First product has a lower variance than the second product
The first product is riskier than the second product
A published solution is not available for this question yet.
Question 22 MSQ · 2.0 marks
Consider two investment opportunities in new products: gourmet marmite and gourmet honey.
People might either really like or really dislike the gourmet marmite, so it generates a payoff of
$0.5 with 30 percent probability, a payoff of $1 million with 40 percent probability and a payoff of
$1.5 million with 30 percent probability. The gourmet honey is less likely to either really turn
people off or really turn them on, so it has a payoff of $0.5 million with 20 percent probability, $1
million with 60 percent probability and $1.5 million with 20 percent probability.
Based on the above data, answer the given subquestions.
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Expected utility of investing in gourmet marmite is more than expected utility
of investing in gourmet honey
A risk averse decision maker prefers investing in gourmet honey to investing
in gourmet marmite
Expected utility of investing in gourmet marmite is less than expected utility of
investing in gourmet honey
A risk averse decision maker prefers investing in gourmet marmite to
investing in gourmet honey
A published solution is not available for this question yet.
Question 23 NAT · 1.5 marks
India currently imports all of its palm oil. The annual demand for palm oil by Indian consumers is
given by the demand curve **Q=2000-4P**, where Q is quantity of palm oil in thousand litres and P is
market price in INR per litre. World producers can harvest and ship palm oil to Indian distributors
at a constant marginal cost (=average cost) of INR 50 and Indian distributors can distribute it at a
cost of INR 10 per litre. Consider market for palm oil to be competitive.
Indian government is considering a tariff on palm oil import of INR 10 per litre. Answer the given
subquestions.
If there is no tariff, what is the quantity demanded (in thousand litres) ____________
A published solution is not available for this question yet.
Question 24 NAT · 1.5 marks
India currently imports all of its palm oil. The annual demand for palm oil by Indian consumers is
given by the demand curve **Q=2000-4P**, where Q is quantity of palm oil in thousand litres and P is
market price in INR per litre. World producers can harvest and ship palm oil to Indian distributors
at a constant marginal cost (=average cost) of INR 50 and Indian distributors can distribute it at a
cost of INR 10 per litre. Consider market for palm oil to be competitive.
Indian government is considering a tariff on palm oil import of INR 10 per litre. Answer the given
subquestions.
If the tariff is imposed, how much a consumer will pay for a litre of palm oil ______________
A published solution is not available for this question yet.
Question 25 NAT · 1.5 marks
India currently imports all of its palm oil. The annual demand for palm oil by Indian consumers is
given by the demand curve **Q=2000-4P**, where Q is quantity of palm oil in thousand litres and P is
market price in INR per litre. World producers can harvest and ship palm oil to Indian distributors
at a constant marginal cost (=average cost) of INR 50 and Indian distributors can distribute it at a
cost of INR 10 per litre. Consider market for palm oil to be competitive.
Indian government is considering a tariff on palm oil import of INR 10 per litre. Answer the given
subquestions.
What is the new quantity demanded now (in thousand litres)? ____________
A published solution is not available for this question yet.
Question 26 NAT · 1.5 marks
India currently imports all of its palm oil. The annual demand for palm oil by Indian consumers is
given by the demand curve **Q=2000-4P**, where Q is quantity of palm oil in thousand litres and P is
market price in INR per litre. World producers can harvest and ship palm oil to Indian distributors
at a constant marginal cost (=average cost) of INR 50 and Indian distributors can distribute it at a
cost of INR 10 per litre. Consider market for palm oil to be competitive.
Indian government is considering a tariff on palm oil import of INR 10 per litre. Answer the given
subquestions.
What will be the lost consumer surplus due to the imposed tariff (in thousand INR) _____________
A published solution is not available for this question yet.
Question 27 NAT · 1.5 marks
India currently imports all of its palm oil. The annual demand for palm oil by Indian consumers is
given by the demand curve **Q=2000-4P**, where Q is quantity of palm oil in thousand litres and P is
market price in INR per litre. World producers can harvest and ship palm oil to Indian distributors
at a constant marginal cost (=average cost) of INR 50 and Indian distributors can distribute it at a
cost of INR 10 per litre. Consider market for palm oil to be competitive.
Indian government is considering a tariff on palm oil import of INR 10 per litre. Answer the given
subquestions.
Tax revenue for the government will be (in thousand INR) ____________
A published solution is not available for this question yet.
Question 28 MCQ · 1.5 marks
India currently imports all of its palm oil. The annual demand for palm oil by Indian consumers is
given by the demand curve **Q=2000-4P**, where Q is quantity of palm oil in thousand litres and P is
market price in INR per litre. World producers can harvest and ship palm oil to Indian distributors
at a constant marginal cost (=average cost) of INR 50 and Indian distributors can distribute it at a
cost of INR 10 per litre. Consider market for palm oil to be competitive.
Indian government is considering a tariff on palm oil import of INR 10 per litre. Answer the given
subquestions.
Tariff results in
Net gain for the society
Net loss for the society
Neither loss nor gain
Cannot compute
A published solution is not available for this question yet.
Question 29 NAT · 1.5 marks
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Based on the above data, answer the given subquestions.
Find the optimal bundle of goods 1 and 2 for this consumer. The optimal bundle will consist of X1 =
___________
A published solution is not available for this question yet.
Question 30 NAT · 1.5 marks
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Based on the above data, answer the given subquestions.
Find the optimal bundle of goods 1 and 2 for this consumer. The optimal bundle will consist of X2 =
___________
A published solution is not available for this question yet.
Question 31 NAT · 1.0 marks
A monopolist with marginal cost, MC = 10+6Q, faces a demand curve P = 20 - 2Q. Answer the given
subquestions based on this information.
The slope of the marginal revenue curve is ____________
A published solution is not available for this question yet.
Question 32 NAT · 1.0 marks
A monopolist with marginal cost, MC = 10+6Q, faces a demand curve P = 20 - 2Q. Answer the given
subquestions based on this information.
Profit-maximizing price for this monopolist is __________
A published solution is not available for this question yet.
Question 33 NAT · 1.5 marks
A monopolist with marginal cost, MC = 10+6Q, faces a demand curve P = 20 - 2Q. Answer the given
subquestions based on this information.
Profit-maximizing quantity for this monopolist is ___________
A published solution is not available for this question yet.
Question 34 NAT · 1.5 marks
A monopolist with marginal cost, MC = 10+6Q, faces a demand curve P = 20 - 2Q. Answer the given
subquestions based on this information.
The price elasticity of demand at the profit-maximizing point is _____________
A published solution is not available for this question yet.
Question 35 MCQ · 1.0 marks
What is true about monopolistic competition
Firms compete by selling differentiated products that are highly, but not
perfectly, substitutable
Entry and exit are not free in the market
None of these
Both Firms compete by selling differentiated products that are highly, but not
perfectly, substitutable and Entry and exit are not free in the market
A published solution is not available for this question yet.
Question 36 MCQ · 1.0 marks
Adverse selection occurs when
a person takes more risks that are not known to the life insurance company
because he has life insurance
a person buys life insurance because he has a risky lifestyle that is not known
to the life insurance company
a person is a risk lover
pregnant women with health insurance make more doctor visits than
uninsured pregnant women
A published solution is not available for this question yet.
Question 37 MCQ · 1.0 marks
Moral hazard occurs when contracts are written in such a way that
the interests of agent and principal converge
the interests of agent and principal diverge
agents will wish to maximize the principal's utility
production and risk-bearing eficiency are achieved
A published solution is not available for this question yet.