AEC 201 (1+1): Farm Management, Production and Resource Economics Question Paper

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Q.I Fill in the blanks with appropriate word/s (0.5 × 5 = 2.5)

1. When two products are produced in a single production process, then they are called as ________ products.

2. The ratio of marginal product to average product is ________.

3. ________ represents all possible combinations of two products that could be produced with given amount of resources.

4. Change in the total cost per unit increase in output is ________.

5. The marginal rate of product substitution between competitive products is ________.

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Q.II Define / give the meaning of the following (0.5 × 5 = 2.5)

1. Opportunity cost

2. Budget line

3. Farm Management

4. Antagonistic products

5. Marginal Value Product

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Q.III Underline the appropriate answer from the alternatives given (0.5 × 5 = 2.5)

1. Non cash fixed costs include
   a) Insurance premium
   b) Land revenue
   c) Family labour cost
   d) Hired labour cost

2. A production function with an elasticity of 1.00 (Ep = 1) indicate
   a) Increasing returns
   b) Decreasing returns
   c) Negative returns
   d) Constant returns

3. When MPP = APP,
   a) MC = ATC
   b) Ep = 1
   c) Both a & b
   d) None of these

4. Isoquant is also called as
   a) Iso resource curve
   b) Iso product curve
   c) Iso factor curve
   d) Opportunity curve

5. If two inputs are completely interchangeable, then they are called as
   a) Perfect substitutes
   b) Perfect complements
   c) Perfect supplements
   d) None of these

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Q.IV Answer any THREE of the following  

1. A production function for a commodity is given of the form
   ( Y = a + bX + cX^2 )
   Find the level of X at which ________ (part not clearly visible in image)

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Q.V State whether the following statements are true or false (0.5 × 4 = 2.0)

1. Marginal input cost is the price per unit of output.

2. The optimum level of output is when marginal revenue is equal to marginal cost.

3. Marginal cost curve intersects the AVC curve at its minimum point from below.

4. The main objective of combining factors is profit maximization.

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Q.VI Answer the following

1. Give the steps involved in arriving at least cost combination of inputs using algebraic method. (1.00)

2. Briefly explain the decisions to be made by a farmer in the management of his farm. (1.50)

3. What are the characteristics of isoquant? (1.00)

4. Show the nature of PP curve (PPC) in different product relationships. (2.00)

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