MEC 101 MICROECONOMIC ANALYSIS Solved Assignment 2020-21

 

MEC 101 MICROECONOMIC ANALYSIS , MEC 101 Solved Assignment, MEC 101 Assignment 2020-21, MEC 101 Assignment, IGNOU Assignments 2020-21- Gandhi National Open University had recently uploaded the assignments of the present session for BA Programme for the year 2020-21. Students are recommended to download their Assignments from this webpage itself. They don’t got to go anywhere else when everything regarding the Assignments are available during this article only.

Candidates got to download the IGNOU Assignments for appearing within the Term End Examination [TEE] of IGNOU BA Programme.

For Students – MEC 101 MICROECONOMIC ANALYSIS  Students are advised that after successfully downloading their Assignments, you'll find each and each course assignments of your downloaded BA Programme. Candidates need to create separate assignment for the IGNOU Master Course, in order that it's easy for Evaluators to see your assignments.

MEC 101 MICROECONOMIC ANALYSIS

Solved Assignment 2020-21

Answer all questions from this section.

1. (a) Elucidate price and output determination under Cournot and Stackelberg models of Oligopoly.

(b) Consider a market for energy drinks consisting of only one firm. The firm has a linear cost function: C(q) = 4q, where q represents quantity produced by the firm. The market inverse demand function is given by P(Q) = 24 − 2Q, where Q represents total industry output. Based on the given information answer the following:

(i) What price will the firm charge? What quantity of energy drinks will the firm sell?

(ii) Now suppose a second firm enters the market. The second firm has an identical cost function. What will be the Cournot equilibrium output for each firm?

(iii) What is the Stackelberg equilibrium output for each firm if firm 2 enters second?

(iv) How much profit will each firm make in the Cournot game? How much in Stackelberg?

(v) Which type of market do consumers prefer: monopoly, Cournot duopoly or Stackelberg duopoly? Why?

2. (a) Consider an Edgeworth box that describes a two-person, two-commodity exchange scenario. Explain how trade takes place between the two individuals starting from the initial endowment position. What is the significance of the slope of the ray passing through a Pareto optimal point and the endowment point?

(b) Consider a pure-exchange economy of two individuals (A and B) and two goods (X and Y). Assume both the individuals are endowed with 2 units of good X and 1 unit of good Y each.

Let utility functions of individual A and B be UA = min{XA,YA} and UB = min{ 𝑋𝐵 4 ,YB}, where Xi and Yi for i = {A, B} represent individual i’s consumption of good X and Y respectively. Determine the aggregate excess demand functions for each good.

SECTION B

Answer all questions from this section. 5×12 = 60 3.

(a) How would you differentiate a Static game from a Dynamic game?

(b) Consider the following game.

 

 

 

i) Can Backward induction be applied in this game to find a solution?

(ii) What will be the Subgame Perfect Nash equilibria for the given game?

4. What is Kaldor’s compensation principle? How is it used to resolve Pareto non-comparability? How is it different from Hick's compensation principle?

5. (a) Explain the concept of a Homothetic production function. Given a production function q = AL0.5K 0.4 where q represents total production, L and K stands for labour and capital respectively, and A is the technology coefficient. What are the returns to scale for such a production function?

(b) “Homothetic production function includes Homogeneous production function as a special case.” Justify this statement. P (2, 2) Player 1 Player 1 Player 2 (1, 5) (−1,3) (3, 2) (0, 1) Q R S U U T T Player 2

6. (a) Differentiate between a Hicksian and a Walrasian demand function? Do they ever intersect? Explain.

(b) Consider a Cobb-Douglas utility function U (X, Y) = 𝑋 1 5𝑌 4 5 where X and Y are the two goods that a consumer has an option to consume at per unit prices of PX and PY, respectively. Assume income of the consumer to be Rs M. Determine

(a) Uncompensated demand functions for goods X and Y

(b) Compensated demand functions for goods X and Y

7. Raj expects his future earnings to be worth Rs 100. If there is some unfortunate event, his expected future earnings will be Rs 25. The probability of an unfortunate event to occur is 2 3 , while that of things remaining fortunate is 1 3 . Suppose his utility function is given by U(Y) = 𝑌 1 2 , where Y represents the amount of money. Now suppose an insurance company offers to fully insure Raj against the loss of earnings caused during an unfortunate event at an actuarially fair premium.

(i) Will Raj accept the insurance? Explain.

(ii) What would be the rate of actuarially fair premium charged in this case?

(iii) What would be the maximum amount that Raj would pay for the insurance?

 

IGNOU Assignment Status 2020-21

MEC 101 MICROECONOMIC ANALYSIS Solved Assignment 2020-21 Those students who had successfully submitted their Assignments to their allocated study centres can now check their Assignment Status. Along side assignment status, they will also checkout their assignment marks & result. All this is often available in a web mode. After submitting the assignment, you'll check you IGNOU Assignment Status only after 3-4 weeks. it'd take 40 days to declare.

Here the scholars can check their IGNOU Assignment Status 2020, marks, result or both the sessions i.e; June & December.

 

MEC 101 MICROECONOMIC ANALYSIS  Once the TEE assignments are submitted to the Centres, it's send to the evaluation department. After which the evaluation of IGNOU Assignment Solutions takes place.

 

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